Is “Money Moves” Actually Making Money Moves for Cardi B?

There’s money in music. At least, that is what I have always been led to believe. Of the many forms of media, audio is pretty ubiquitous in our society. One study found that 90% of Americans, 12 years and older, listened to AM/FM radio within a week.1 In this day and age, there are also many other ways to enjoy music outside of traditional radio -- you may stream music online using a platform such as Spotify or Apple Music, or maybe you enjoy watching music videos on YouTube. Because music is getting a lot of exposure through these many facets of the industry, I generally think of artists and bands making a large sum of money through their craft. However, the role of the record labels in the "money equation" is often overlooked. If you are a consumer of the music industry, you may be interested to see where your money really goes when you purchase music. Below, I analyzed three popular songs.

Cardi B, who sang "I make money moves" in her single "Bodak Yellow." Image from http://mercercluster.com/22462/showcase/how-to-make-money-moves-like-cardi-b/

Cardi B is famously known for her line “I make money moves” from her hit single “Bodak Yellow.” The song spent three weeks in the number one spot on the Billboard Hot 100 list after being released in June 2017 by Atlantic, a record label owned by the Warner Music Group. 2,3  This song is $1.29 on iTunes, and Apple keeps 40 cents of this. Of the remaining 90 cents, 9.1 cents must contribute to “mechanical royalty,” meaning it will go to Cardi B and the other writers of the song.4  Dieuson Octave, Klenord Raphael, Jordan Thorpe, Laquan Green, and Anthony Write helped to write the song, so assuming each contributor gets a sixth of the mechanical royalty, Cardi B will get 1.5 cents from this.3 The rest of the money will be given to the Warner Music Group (WMG), which will distribute about another 16% to Cardi B (roughly 20 cents). Thus, WMG will receive about 60 cents of the purchase.

This means that for every $1.29 purchase, here is the approximate breakdown:

• Distributor company (Apple): 40 cents
• Artist (Cardi B): 21.5 cents
• Co-writers/contributors to the song: 7.5 cents
• Record company: 60 cents

WMG will use the money for marketing and advertising, as well as for profit.4 Since the song has been sold about 5 million times since April 2018, it has made roughly $6.45 million from iTunes alone.5 Cardi B likely made around $1 million from this amount, with iTunes and WMG receiving about $2 million and $3 million, respectively.

Ariana Grande is also known for being a powerful female artist in the industry. “Dangerous Woman” was the lead single for her 2016 album; it was released by Republic Records, which is owned by Universal Music Group (UMG). Using the same breakdown as Cardi B, we can infer that Ariana Grande made about 22.3 cents for every $1.29 purchase on iTunes. The song did very well, selling about 1.09 million copies as of April 2018.6 Thus, the song made around $1.4 million from iTunes. Ariana Grande likely brought in $238,000 from this song, whereas around $658,000 went to UMG and $560,000 to Apple. Also, Ariana Grande spreads her music through YouTube, which will usually pay the record label $1 per 1,000 views.4 In addition to the music video for this song, an acapella and audio version of the song were posted on Grande’s channel. Combined, these videos account for about 618 million views, so Grande and UMG made approximately an additional $618,000 online through YouTube.

    

"Ariana Grande - Dangerous Woman" (left) and "Ariana Grande - Dangerous Woman (A Cappella)" (right). These videos were posted on the Ariana Grande Youtube Channel. Sources: https://www.youtube.com/watch?v=9WbCfHutDSE , https://www.youtube.com/watch?v=VVYTzauIb_4

Finally, a top song that debuted in 2018 was “In My Blood” by Shawn Mendes. The song was released by Island Records, which is owned by Universal Music Group. With about 1 million copies sold as of May 2018, the song generated around $1.29 million from iTunes.7 Around $219,000 went to Mendes, and $400,000 to Apple. As the trends have shown, a majority of the money - about $600,000 from this song - ends up in the hands of the record label.

The biggest impact that digital media has had on the music industry is altering the way in which we consume our music. Whereas music has traditionally been appreciated through the radio and CDs, we have entered an era where online applications are increasingly growing within the industry. I personally purchase my music through iTunes, but it is important to point out that in the above calculations I did not account for the money that artists and labels are receiving from subscription services (which, according to Rolling Stone, is an extremely complicated formula).4 With more than 30 million people paying for a subscription service, such as Spotify or Apple Music, streaming now makes up 62% of the U.S. music industry.8

A representation of many music applications, including Spotify, Deezer, Apple Music, Pandora, iHeartRadio, Tidal, SoundCloud, and Napster. Image from https://gizmodo.com/streaming-music-services-from-most-screwed-to-least-sc-1793612699

Additionally, although most Americans listen to traditional radio, 64% of Americans, 12 and older, listen to online radio within a month.2 Sites like YouTube, which the music industry depend heavily on, have shaped the visual, online environment in which people consume their music.9 Additionally, it has formed a way for independent artists, not associated with labels, to make money through their work. Thus, it is more accessible for people to share music, and there is a larger variety of choices for the audience. Finally, I believe that digitization is also influencing the role that social media plays in the music industry. Although Cardi B does not make as much money as her record label does from her music, one could argue she certainly makes enough money for a living, and one of the driving forces contributing to her immense fame was her Instagram account and personality.2  Thus, social media and online exposure are critical factors that now influence people’s consumption of media.

Sources:

1. http://www.journalism.org/fact-sheet/audio-and-podcasting/

2. https://www.eonline.com/news/925734/money-moves-how-the-cardi-b-empire-got-built
3. https://en.wikipedia.org/wiki/Bodak_Yellow
4. https://www.rollingstone.com/music/music-news/the-new-economics-of-the-music-industry-234924/
5. https://www.forbes.com/sites/bryanrolli/2018/04/06/cardi-b-invasion-of-privacy-gold-technicality/#2cf9be287c9f
6. https://en.wikipedia.org/wiki/Dangerous_Woman_(song)
7. https://en.wikipedia.org/wiki/In_My_Blood_(Shawn_Mendes_song)
8. https://www.recode.net/2017/9/20/16339484/music-streaming-riaa-spotify-apple-music-youtube-2017-revenue-subscription
9. https://www.theguardian.com/commentisfree/2016/jul/02/music-industry-battle-against-youtube