Music Industry Provides Solid Backbeat in Composition of Nashville Economy
Published Mar 12, 2008
Country Music Television has its headquarters in Nashville. Another cable channel, Great American Country, also is based here.
The Nashville area’s music business generates much more than rhythm and harmony - the syncopated ka-ching of the cash register also is a welcome sound.
From corporate giants like Gaylord Entertainment (owner of the Grand Ole Opry) and Viacom (owner of Country Music Television, or CMT) to startup companies along Nashville’s Music Row and Christian music enterprises in the suburbs, music is a huge business in and around Music City.
“It wouldn’t be a stretch to say music is the No. 2 industry that drives Nashville’s economy,” says Kira Florita, executive director of Leadership Music, a nonprofit organization that facilitates communication among music industry leaders. “Health care may have larger numbers in terms of employment and revenue, but the music business touches so many parts of the city. It has a huge effect on tourism and promotes awareness of Nashville around the world.”
The area is home to more than 80 record labels, 130 music publishers, 180 recording studios and about 5,000 working union musicians. According to a study conducted by the Nashville Area Chamber of Commerce and Belmont University, the music industry locally is worth $6.38 billion annually, including $2.42 billion in music-related tourism and $2.64 billion in direct economic contributions from music-industry enterprises.
People everywhere are taking note. In a January 2007 story titled “Cashville USA,” Fortune magazine tipped its hat to Nashville, saying country music has become a “surprise profit center for the music business” and pointing out that country album sales grew more than 12 percent between 2000 and 2005 - a period when overall music sales declined by more than 20 percent.
Besides racking up dollars, the music business accounts for an estimated 54,000 jobs in Middle Tennessee. And new entrepreneurial music-related ventures are continuing to emerge.
Nashville-based Echomusic LLC, for example, facilitates one-on-one relationships between musicians and fans through Web site design and development, fan club administration and management of promotional “street teams.” Started in 1999 with three employees, the company now has nearly 50 employees, and its 200-plus clients include hitmakers such as Keith Urban, Kelly Clarkson, Rascal Flatts and Alison Krauss & Union Station.
“We’re a transparent medium that provides artists with the technology needed to connect with their fans,” says Andy Whitaker, sales and business development representative for Echomusic. “With our help, artists are better able to market themselves, and fans get relevant information they request.”
In March 2007, California-based Ticketmaster announced plans to purchase Echomusic, keeping Echomusic’s management in place and adding 13 or 14 staff positions by the end of the year. The infusion of capital is expected to help Echomusic grow, and company executives hope the deal will expand its client list beyond Music Row into other genres such as rock, pop and even sports.
DigitalDirect Media Services LLC, another company with headquarters in Nashville, enables consumers to buy audio and video downloads directly from a provider without having to go through iTunes or MSN Music.
“We are a white-label delivery service that deals with everything digital media,” says Tom Garofalo, chief executive officer of DigitalDirect. “Essentially, a content owner gives us a list of digital media they want to sell, and we sell their product and hand the money back to them.”
Griffin Technology Inc., also based in Nashville, manufactures accessories for iPods and other computer products. Their accessories are sold worldwide at big-box retailers.
“A large part of our customer base is music listeners,” says Jackie Ballinger, public relations director for Griffin Technology. “The first iPod accessory we made was the iTrip, an FM transmitter you can ‘sync’ with a [station on your car radio] to broadcast your music over the radio.”
Not only are new companies starting in Nashville, established companies are relocating here. In September 2005, Scripps Networks relocated the headquarters of its country music television channel, Great American Country, from Denver to Nashville, and GAC, a sister network to HGTV and Food Network, has the potential to reach as many 45 million viewers.
Back at Echomusic, Chief Executive Officer Mark Montgomery ticks off a long list of the benefits of operating from the Nashville area. “Along with a superb creative community, almost any skill set is within reach,” he says, “and the location puts you within (a relatively short) distance of a significant portion of the U.S. population if that skill isn’t available locally. That combined with a great local culture, art, food, real estate and music makes this one of the places to be in the U.S.”
Story by Jessica Mozo
Photo by Brian Gassel
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