Indie musicians struggle financially as profits and distribution remain paltry

Posted on : 2010-11-09 14:05 KST Modified on : 2010-11-09 14:05 KST
One music critic says people should increase willingness to pay for and support good music
 Nov. 8. (Photo by Kim Myoung-jin)
Nov. 8. (Photo by Kim Myoung-jin)

By Surh Jung-min  


Attention is focusing once again on the distribution of profits from digital music downloading, which has recently become the main source of revenue for musicians. This came about after it came to light that one-man-band Moonlight Nymph (Lee Jin-won), who passed away last Saturday, had been struggling with financial difficulties. Internet users have increasingly called for restructuring the current system where an exceedingly small portion of profits goes to the musician.

Major Korean music sites such as MelOn and Mnet typically receive 500 Won for a single song download, amounting to just under half the one dollar Apple’s iTunes receives per song. The music site usually takes 45 percent of this. Subtracting 9 percent in copyright fees and 4.5 percent in performing rights, which go to the copyright association and performing rights association, leaves around 40 percent of the original price. After subtracting the fee for the distribution agency, around 200 Won goes to the production company and the musician.

In the case of iTunes, the site takes 30 percent, while 70 percent is given to the distribution agency. The agency splits this amount with the production company. DFSB, which sells South Korean records overseas through iTunes, gives over half the one dollar download fee to the production company.

The problem is that the bulk of the South Korean music market consists not of individual song downloads, but of real-time streaming and monthly fixed payment services. In the case of streaming services where users can have unlimited access for 3,000 Won a month, the amount paid to the production company and musicians amounts to just a few won per song. For fixed payment systems, which range from 40 downloads for 5,000 Won a month to 150 downloads for 9,000 Won a month, production companies and musicians receive per song payments in the tens of Won. Because the price has been set so low, musicians are receiving unreasonably small amounts of money for their music.

Streaming and fixed payment systems account for an estimated 70 percent or so of the Korean record market. Under these circumstances, even a fairly well-known indie musician is unlikely to receive more than 5 million Won ($4,460) for a single album from online music services.

“With an increased belief that ‘music is free’ due to factors such as illegal downloading, consumers are only interested in cheap services, so we have to offer them a fixed payment system,” said an official with one music site.

Some production companies have discussed establishing a separate record distribution site with fair profit distribution.

“There is unlikely to be any further development in a music market like the current one that is centered mainly on fixed payment services,” said Lee Chang-hui, president of Mirrorball Music, a company that distributes independent music. “We need to change to a market where individual songs are downloaded.”

Popular music critic Kim Jak-ga said, “We need to open our wallets for the music we like, with the understanding that better music will only be made when we pay a sufficient price for the music.”


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