It used to be easy to tell who the big acts were. If an artist appeared regularly on Top of the Pops or lodged their releases consistently in the charts, we knew they were popular and, very probably, financially successful.
That's no longer true. There are now hitmakers who appear frequently on TV, who are household names and faces, but who are not making fortunes. At the same time, increasing numbers of relatively unknown musicians are quietly getting rich without their faces ever appearing in Heat magazine, or even NME. The old rules for judging pop success no longer apply.
Arguably, the tipping point at which it became impossible to use the old measures of success was 2006, when Top of the Pops was taken off the air. TOTP had to die, because the charts were no longer the barometer of public taste they had once been. At the high-water mark of singles sales in the 80s, a record had to sell in the region of a quarter of a million copies to make No 1. By the end of the 90s, 100,000 would do it. Come 2006, Orson's No Tomorrow shifted a meagre 17,694 copies to reach the top - the lowest weekly sale for a chart-topper since 1960.
Coincidentally, 2006 was also the year in which Conor Oberst, leader of American indie ensemble Bright Eyes, and founder of his own independent record label, Saddle Creek, told Blender magazine: "I can't imagine running a label without the internet."
Bright Eyes was the vanguard of a new breed of artists who sold their music and associated merchandise via the net, rather than relying on the mechanics of a deal with a major label. The mathematics of this kind of success are blindingly simple. An artist signed to a major record label is lucky to see 5% of whatever profits their CDs earn. An internet-marketed indie band, however, might sell only a 20th of what they might have done via a major, but they would reap a much larger share of the profits and retain creative control over their music, since all the money is coming in to the band.
Besides, CD sales are now just one ingredient in the earnings pie. Columbia (UK) Label Group MD Mike Smith, who looks after artists including Bruce Springsteen and Bob Dylan, points out that the business model which existed when those superstars started out is no longer universally applicable. "A lot of artists now see a record deal not as an end in itself," he says, "but as a means to drive everything else."
Paul Williams, editor of music trade magazine Music Week, agrees. "We need to look at a lot more factors to be able to determine who's really doing well today," he says. "Everybody from Britney Spears to Leona Lewis to a guy recording songs in his bedroom - the way their incomes are made up is much more complex. It's not just about how many records, or even concert tickets, you have sold."
What Smith and Williams are alluding to is the increasingly lucrative revenue streams artists can tap into from a host of sources - including what is called "synchronisation", product endorsements, merchandising, internet streaming, ringtones, magazine cover mounts and broadcasting royalties.
Synchronisation means getting your music into TV ads, TV series and movies, and on to ringtones and computer games. It can be hugely lucrative: "Aerosmith have probably earned more through royalties in Guitar Hero than they have from selling albums in the past two decades," suggests Sat Bisla, founder of Musexpo, an annual Los Angeles-based international music and media conference. If that estimate sounds a bit wild, consider the sales figures: the bestselling album of all time, Their Greatest Hits by Eagles, released in 1976, has to date sold 29m copies. Guitar Hero, since its launch in late 2005, has sold 23m.
It's not only the dinosaur bands of old who have seen the benefits of synchronisation: in fact, newer bands can do well from synchronisation deals precisely because they don't demand the same level of recompense as Aerosmith and their ilk. "Media companies now realise that a lot of high-quality music exists in the indie world," points out Bob Baker, author of the Guerrilla Music Marketing Handbook. "And they can get that good music for less money and with less paperwork than dealing with high-profile acts."
Little-known English speed metal band DragonForce landed one song, Through the Fire and Flames, on Guitar Hero III and, in the words of their manager, Steve McTaggart: "Particularly in the US it opened the band up to a young audience that would probably never have found them just from touring." DragonForce guitarist Herman Li adds: "We now have four songs available for Guitar Hero, and the money is good, but competition to get tracks on there is getting more fierce."
Michael Laskow, founder of the independent Los Angeles-based A&R company Taxi, has seen several of his acts benefit from synchronisation deals. "More than a handful of Taxi members have made six-figure incomes from film and TV placements," he says, "but it takes time. Sometimes you'll make $25 from a placement; other times, several thousand. It's the aggregate of many of them repeated over a period of years that really adds up. It's a more stable way to earn money with your music, and you don't need to leave your home to do it."
One high-profile beneficiary of synchronisation was Kimya Dawson, who got lucky when a bunch of her songs were used in the Academy Award-winning 2007 movie Juno, propelling her to mainstream success after years of toiling away in the margins. And Denzyl Feigelson, a founding partner of the digital music distribution company AWAL (Artists Without a Label) cites the case of Ingrid Michaelson who, he says, "has sold over 250,000 albums and over 800,000 digital downloads, completely without a record deal, so she makes in excess of 60% of her iTunes profit".
How did Michaelson, whose name I'd never heard until Feigelson mentioned her, do it? She got one of her songs synchronised in the TV series Grey's Anatomy, which has become a crucial means of getting a certain kind of music to the public via music super-visor Alexandra Patsavas (the show's website lists all the music in each episode, so viewers can instantly identify any song that catches their ear). Having made that connection, one song on the show became five, which led to three more in One Tree Hill, one in an Old Navy sweater commercial and a string of TV chat show appearances. The exposure brought 90,000 hits a day to her MySpace page and she was on the way to big-time success without ever entering the traditional marketing apparatus of the record industry.
Obviously that can't happen to every struggling act, but it proves success can be found by anyone who can get their music in front of an audience (so long as the tune is good enough), and that getting your music to that audience no longer requires the assistance of giant labels. Crucially, those who can market their music under their own steam are more likely to own the rights to that music, instead of selling them to a record company. Artists increasingly record material at their own expense, then license it to a label or self-release it, because the song's owner gets the lion's share of synchronisation money.
The industry is now restructuring itself to accommodate the requirements of artists who either are, or are seeking to become, independent. Consider, for example, the phenomenon of the virtual record label. Henry Semmence is the MD of the 10-year-old, London-based Absolute Marketing, which, he says, "has all the skillsets - press, TV, radio, marketing - that record companies have, except we don't make records."
Absolute is most frequently employed by artists with a big profile, from Dame Shirley Bassey to McFly, who are now pursuing the independent route. But the firm also appeals to emerging acts who want marketing muscle without giving away the lion's share of the profits. With or without allying themselves to a company like Absolute, canny artists such as Oberst, Michaelson and Dawson can use MySpace, YouTube, downloads from their website and other modern marketing strategies to make them not just viable but financially successful.
A snap poll of UK music consumers would almost certainly reveal that only a tiny minority had ever heard of Oberst, Michaelson or Dawson. They would, however, recognise the names of manufactured acts and reality-show contestants such as the Saturdays or Leona Lewis, and would, no doubt, consider them successful by the traditional yardsticks - high visibility on TV and in the charts.
But are they really successful? Or are we (and they) being dazzled by showbiz razzmatazz? Understandably, the record labels and impresarios who spend hundreds of thousands of pounds funding an artist's early career want to see a profit on their investment. They do this, perfectly legally, by contractually securing a sizeable share of the artist's profits for themselves. A report in Film&Music in 2007 found that the estimated cost to a label of launching a band was nearly £600,000, of which only about £35,000 each over 18 months would go to the musicians. Thus, it can be years before an artist of this sort turns a significant profit and, mostly, their careers don't last that long.
So who's really successful - Ingrid Michaelson or Leona Lewis? Without access to their bank statements, we can't know for sure, but what's clear is that the old metrics of success - the ones that told us Macca, Madonna and U2 were in the money - don't apply to musicians of the internet age.
"I coined the phrase 'musician middle class' several years ago," says Michael Laskow of Taxi, "because I think it's inevitable that more musicians will be making some money with their music. In the past, you grabbed the gold ring or nothing at all. It's easier now for an artist to make tens of thousands, even hundreds of thousands, of dollars using the online tools."
Of course, it's also now possible to be hugely popular around the world without directly seeing a penny from your success. Worldwide in 2006, 509m song downloads were purchased legitimately online, but an estimated 5bn (38,000 years' worth of music) were illegally swapped for free on peer-to-peer sites. Ethical implications aside, this means some artists can receive a massive boost in popularity without reaping a penny more in profits - until more fans turn up at their live shows.
"A generation of artists is redefining success in very different terms," says Eric Garland, whose California-based company Big Champagne monitors worldwide file-sharing, both legal and illegal. "They're looking at those traditional major label opportunities and performing real cost-benefit analyses. They're saying, 'Well, a major label deal will put money in my pocket today, but there are 10 other paths where I might have a meaningful chance of growing a small business slowly on my own. Twenty years from now, I might not own a Lear jet - but I'll still be earning.'"
However, the definition has also changed for the bigger earners. Mega-success was once largely measurable in terms of record sales, and defined for the public by high visibility in the media. Now, to gauge accurately how successful any given artist might be, it's necessary to factor in a huge variety of possible synchronisation earnings plus peer-to-peer transactions, legal downloads, streaming revenues, product endorsements, ticket sales, merchandise, indie profitability as opposed to major label artist profitability and more. At the moment, even the industry has no reliable means of combining all of those factors into a single measure of success, so what hope does the public have?
"It was a very simple business for a long time," continues Garland. "You made the plastic discs and relied on the promotional properties of print and broadcast media to create awareness of those discs. It is far more complex now. It's as complex and challenging for the music business as it is for the public."
