Pop will eat itself

The Justin Timberlake poster is remarkable. It dominates the window of a Paris boutique. Technical credits are first class, the photography is outstanding and the female model is gorgeous. Only upon examination does it become apparent this is not an advertisement for an album. Justin Timberlake is promoting a fragrance. It is Play, his cologne for Givenchy, launched in the summer of 2009.

Timberlake is not plugging a new album because he doesn't have one. He has not for four years. In fact, he has only released two albums in the eight years he has been a solo artist. Seeing that Justin's boy band *Nsync issued four albums between 1998 and 2001, the natural question is to ask if he has dried up. After all, The Beatles recorded their entire body of work in the time it has taken him to produce two CDs. Elton John had seven consecutive US No 1 albums in the space of time since Timberlake released his most recent.

But these are not natural times in the music industry. Since *Nsync sold 11 million copies of No Strings Attached in 2000, album sales in the US have dropped like a stone. We have been waiting years for the rock to strike the surface of the water in the well – so long we are beginning to wonder if this well is a bottomless pit. Since 2003 no album has reached 10 million in US sales. Few have reached five. This year's best seller, Eminem's Recovery, is struggling to reach three. The trade bible Billboard reports that sales as of early November are down 13 per cent year on year, after a decade of rolling and tumbling. No wonder artists are looking for ways to compensate for lost income. Fronting a fragrance, appearing in movies, owning restaurants – Justin Timberlake has done all of these, and he is not alone.

There is one other thing he has done, even in years of recording inactivity. He has toured. Man did not build arenas and stadia for sport alone, and horticulturists did not design public parks merely for plants.

During most of the rock era, being hot in the charts was a virtual requirement for what Variety would call "boffo b.o.", meaning big box office. Today you don't need a new hit to make millions touring. You don't even need a current record. What matters is the size of one's catalogue and the quality of one's performance. The top live act in the world this year so far has been AC/DC.

This is neither a joke nor a news flash from 1980. The Anglo-Australian rock band have taken more than $100m at the tills so far, according to Pollstar, the definitive source on concert grosses.

The American-only figures for the first half of 2010 also suggest a trip in H G Wells's time machine. Bon Jovi led the list with $52.8m, followed by the pairing of old friends James Taylor and Carole King with $41m, Taylor Swift on $34.2m, Paul McCartney taking $31.6m, and the country bill of George Strait, Reba McEntire and Lee Ann Womack earning $29.8m. (In the interests of disclosure, we should add that the pairing of Elton John and Billy Joel grossed $22.1m.) Counting Richie Sambora as half of Bon Jovi, the average age of these top five acts was 52 and two-thirds years, and that includes tender 20-year-old Taylor Swift. It's a far cry from when The Beatles started the trend to larger venues when they played Shea Stadium on 15 August 1965, at an average age of 23-and-a-half.

Four of Forbes' top five female entertainers in the period 1 June 2009 to 1 June 2010 – in other words, everybody except Oprah Winfrey – were pop stars. But they didn't get the bulk of their earnings from recordings. Beyoncé, who trailed Oprah's $315m earnings with her second-place $87m, didn't release a new record. Britney Spears, next on the lucre list with $64m, also did not put out fresh work, settling for a soft-selling oldies CD. Lady Gaga, fourth in the financial frame, earned $62m, coasting on her 2008 debut album The Fame with its expanded version, The Fame Monster. Madonna, taking a stand for seniority with her fifth place $58m, also did not release a new album in the period, just a greatest hits double.

The top four female artists earned a cumulative $271m without putting out a new album! How did they do it?

Personal product lines and endorsements helped a lot. Beyoncé has launched her House of Deréon fashion line and Madonna has made clothing deals. But the overwhelming share of this cash came from touring. Beyoncé appeared in every continent except Antarctica – 32 countries in all. Madonna grossed $138m on her marathon tour. Britney took $130m for 100 shows and Lady Gaga $95m for 106 dates. It is unlikely that they aspired to spend more time concertising than recording. It's just that the economics of the music business in 2010 are bullish on live work and bearish on record sales.

Major artists are taking advantage of favourable conditions The Beatles never enjoyed. A new generation of stadia and arenas has made public assembly a far-more-pleasant experience than it was in the rugged sport settings of old. The computerisation of ticket sales has made it possible to process millions of applications in minutes rather than laboriously by hand. And with each year, a greater share of the population has grown up with popular music at the centre of life. With more money to spend on tickets than they dreamt of as teenagers, they have the cash or at least the credit to absorb the £50+ average ticket price of a top show. (Elton and Billy Joel averaged $119 per ticket in the US this year.) Long gone are the days when Barry White shocked the industry by charging a top tariff of £6 at the Royal Albert Hall. Today that amount might get a standing room place in the gods.

Record companies, in contrast, are in the dumper. They have never recovered from alienating America's youth in the 1990s, when they stopped pressing singles in an attempt to force fans to buy albums. For example, in 1999, Lou Bega sold over three million copies of his long player A Little Bit Of Mambo because there was no US single of the UK No 1 "Mambo No 5 (a little bit of ... )". When I told a leading US radio executive that this was a bit rough on consumers, he replied: "Lou Bega's happy."

An entire generation did not share Lou's joy and learned how to use the internet to find its favourite music for free. The labels fought a rearguard action, which was doomed because young people learning the latest programs always navigate computers more nimbly than their elders. Efforts to silence Napster and its ilk and attempts to criminalise file sharers only antagonised the public further. It never occurred to the record industry to try to learn to live with the internet. It took Steve Jobs to save the music business by introducing iTunes, which he did not out of charity but because he wanted content for his iPods.

The collapse of the 2000s was not due just to technology. Ever since Michael Jackson's success with Thriller, which generated seven hit singles, record companies believed their future lay in milking hit albums through a succession of individual tracks. Whereas artists had released an album once every year or six months, they now took a few years before new releases.

The only flaw in this logic was that no artist since Michael Jackson has had as high a success rate as Michael Jackson. He gave the illusion of being a prolific artist even though he took years between releases because he had an historic string of hit singles taken from his albums. But if you don't have seven hits on your album, everyone notices the gap between albums. The audience will learn to live without you, something Sinatra, Presley, The Beatles, Elton and the Motown stars never let happen. The audience will also learn to live without the album and it has done that, too. Downloaders tend to buy individual tracks. Just like that, the age of the album is over.

Record companies face another problem not of their own making. Music sales are dropping as young people do not want to buy records. Their favourite musical performers are not recording artists but reality show singers. If record companies got a share of the ad revenue from reality television programmes they might be happy with the historic levels of interest shown in the contestants. As it is, only labels associated with format owners Simon Cowell and Simon Fuller get to sell recordings by the artists who emerge from shows like X Factor and American Idol.

It gets worse. The interest in these karaoke competitions demonstrates that the mass audience no longer cares about new songwriters. The rock era in which artists wrote, sang and played their own music is over. In the sense that the jazz age is long gone but quality jazz artists still serve a shrunken share of the market, a few quality rock acts such as Kings of Leon rock on after the general public has rolled off. Hip-hop has also faded in market share. Consider that the best-selling album in America in 2006 was High School Musical, in 2007 was the Josh Groban Christmas album Noël, and in 2009 was Fearless by teenage country star Taylor Swift. Then factor in last year's world No 1, "I Dreamed A Dream" by Susan Boyle. The only possible conclusion to draw is that young record company artists-and-repertoire men still signing rock and hip-hop artists are ignoring the most profitable genre, which is the middle of the road market. Record companies today are supplying products for which there is reduced demand. It is no wonder sales continue to deteriorate.

So the leading artists of today don't even try to build a large catalogue. Lady Gaga is an international phenomenon, the only true pop star on the old model, but even she has released what is basically the same album three times, the second as a deluxe version and third as a remix CD. Leading veteran artists have a large stock of hits to sustain a two-and-a-half-hour set. Stars of the last 20 years don't. They have a third or less of a repertoire. This is why American promoters are howling for new acts. They foresee their business threatened in 10 or 20 years, when legends of the Sixties and Seventies retire and their places are not taken by younger artists.

By this time record companies hope to have learned to live with technology. They will have moved beyond ringtones and TV synchronisations to find better ways to sell new music, rather than offer it up for theft. Until then, musicians have little reason to spend time in the studio when they could be out playing stadia and earning millions. They might as well open their own House of Deréon.

I'm with the brand

It seems that as a music star's stock rises, so too does their desire to cash in on their fame through non-musical business moves, which range from the predictable to the bizarre.

* Rap star Kanye West has his own internet search engine (Search With Kanye West, in case you're looking for it).

Aerosmith guitarist Joe Perry has his own line of "hot sauce".

* The R&B singer Usher teamed up with Mastercard to launch a range of credit cards.

* Justin Bieber has, curiously for a 16-year-old boy, his own line of nail polish called "One Less Lonely Girl".

* Madonna yesterday opened the Hard Candy Fitness centre in Mexico City, the first of what she hopes will be a worldwide chain of "first class" gyms.

* Lady Gaga has released her own range of Heartbeat headphones.

* Jennifer Lopez sold the first pictures of her twins Emme and Max to People magazine for a reported $6m.

* Beyoncé is now focusing on her clothing ranges, House of Dereon and I Am Sasha Fierce.

* Jay-Z has non-musical business opportunities including the clothing label Rocawear and the New York nightclub 40/40.

* 50 Cent, Eminem and P Diddy all have their own clothing ranges, while P Diddy has also carved out an extra source of income for himself in promoting the vodka brand Cîroc.

* The popular Guitar Hero game now has Metallica and Aerosmith versions, while stars such as Ozzy Osbourne (who made himself into a product with a reality TV show about his home life) are playable characters.

n X-Factor winner Leona Lewis was signed up by the game Final Fantasy XIII, where she appeared in advertisements for the product and allowed one of her songs to be used in the game.

* Last year, pop star Katy Perry said: "I have a job, I know my responsibility and I'm always trying to take it to the next level ... most of these bitches just hawk breath mints or shoes. No offence to them, but maybe I'll hawk shoes later in life." She seemed to have forgotten all that, however, when she debuted her own perfume, Purr, last month.

Luke Blackall