Taylor Swift's Eras tour and rerecordings break records, resulting in a $5.7 billion boost for the US economy. Here's how she does it.
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00:00 I think the best way to quantify Taylor Swift's impact on the economy is to look at a figure from the Washington Post.
00:07 They estimate her impact this past year was $5.7 billion. That's the Taylor Swift effect.
00:15 Hi, my name is Juliana Kaplan. I'm a senior reporter at Insider on the economy team, and I cover the economy, especially the Taylor Swift economy.
00:25 Taylor Swift is a singer, songwriter, director, and I would say one of the most dominant economic forces in the U.S. right now and across the world.
00:35 What makes Taylor Swift so beloved to her fans, to the Swifties, is that she makes them part of her story.
00:41 My fans and I, we kind of have a really funny sort of, like they tease me a lot, and I enjoy it.
00:49 You do, yeah.
00:50 And Taylor Swift lets Swifties into her lives and the business of Taylor Swift in a way that is sort of unparalleled among artists.
00:58 There's the Easter eggs, there are fans getting invited to her home.
01:01 Hey guys!
01:02 There's her Tumblr following where she would interact with fans directly.
01:07 Swifties get sort of a different type of access to this musician in person they admire so much that is really rare.
01:14 The saying, like, don't ever meet your heroes, it doesn't apply to Taylor Swift.
01:17 Doesn't apply at all.
01:18 She's just like, she's so amazing.
01:21 The world should pay attention to Taylor Swift because her net worth and the economic boost that she is giving to some areas is greater than the GDP of some countries.
01:31 Just economically, she's a huge powerhouse.
01:34 The most normal thing about my life is having sort of crowds form everywhere you go.
01:39 Almost everything that Taylor Swift touches turns to gold and I think we've seen some really good recent examples.
01:46 Taylor Swift is seen at an NFL game after being linked in some tabloids to Travis Kelce.
01:53 This seems to confirm and then we later get more confirmation, the news that they're dating and we see this huge spike in interest in the NFL and Travis Kelce.
02:04 Viewership numbers are going up.
02:07 You know, for years the NFL I think has been trying to capture younger women, younger female audiences.
02:13 Turns out all you needed was to get Taylor Swift in the stands.
02:16 Taylor can stay around all she wants.
02:19 I was seeing some people online talking about how they were going to start buying tickets to Chiefs games just to like maybe get a glimpse of her.
02:28 And you know, anyone I think who is tuned into an NFL broadcast where Taylor Swift is there, you're going to see a lot of Taylor.
02:35 More people were searching for Travis Kelce when he was linked with Taylor Swift than when he won the Super Bowl.
02:40 [Singing]
02:44 Some people this spring and summer went on what they were calling Swift-cations.
02:49 So I spoke to several people who said that they spent anywhere from a week to a few days in whatever location of the Aeros tour they were going to.
02:59 For Taylor, I would go across the world.
03:02 Pretty much anywhere she went, people were spending a lot of money, but some concrete figures in Kansas City, where Taylor Swift is now spending a lot of time for a different reason,
03:10 they saw a $47.8 million boost from direct spending.
03:16 Meanwhile, we see the Federal Reserve of Philadelphia saying that May was the strongest month for hotel revenue in Philly since the pandemic,
03:25 which they attributed to people coming to see the Aeros tour.
03:28 As of August, the Aeros tour was on track to become the highest grossing tour of all time, and it is already the highest grossing tour ever by a woman.
03:38 Aeros tour tickets technically started at $49.
03:41 The Washington Post had the average ticket price at around $456.
03:46 Meanwhile, Pitchfork says that the average resale price was $3,801 for an Aeros tour ticket.
03:54 All told, CNN calculated that Taylor Swift will gross $2.2 billion on the Aeros tour.
04:00 Taylor Swift's tour triggered a congressional hearing over Live Nation and Ticketmaster's ticketing practices.
04:09 There was a lot of discussion about whether Ticketmaster and Live Nation had become a monopoly with their merger in the 2010s,
04:16 and there was a congressional hearing to basically continue to probe that and figure out whether or not Ticketmaster had undue power or influence in the ticketing market.
04:29 We've actually seen a few concrete actions coming from the Biden administration to address some of the issues that ticket buyers ran into.
04:38 For instance, let's say you wanted to get one of those $49 tickets to the Aeros tour.
04:43 Lucky you, you get it in your cart. All of a sudden, maybe you're paying a service fee and a venue fee and a fee to get them delivered to your Apple Wallet or to your Ticketmaster app.
04:53 And if you are seeing that ticking time clock, the tickets are about to disappear from your cart, you say fine, even if it doubles the cost of the ticket.
05:01 So over the summer, the Biden administration announced an initiative to have all-in pricing for ticketing services,
05:09 which means that when you go to buy a concert ticket and you see the price, that's the price.
05:14 She also has been really instrumental, I think, in reshaping people's understanding of the music industry and the ways that artists are compensated or not.
05:23 We really haven't figured out a way to compensate the creators, and that's something that I'm always going to be very vocal about until I feel like it's fixed.
05:30 When Apple Music was first getting off the ground, they announced this free trial period to try and get people hooked on Apple Music.
05:39 And during that time, they would not be paying the artists for those streams.
05:44 This is where Taylor Swift steps in.
05:46 She wrote a letter to Apple saying that she was surprised and upset by this decision to not pay artists for somebody having access to their work.
05:56 And in a very rare move, Apple decided to reverse it.
06:01 And they did decide to start paying artists in 2015 under that free trial period.
06:06 That actually helped reverse the tides in a lot of artists' outlook on Apple Music as well.
06:12 It's no secret that the film industry in Hollywood has had a rocky recovery from the pandemic that was then compounded by a huge amount of their workforce going on strike for better conditions, better pay, stronger protections from AI, which has become a really big concern in the industry.
06:32 Then enter the heiress tour film.
06:36 The heiress tour worldwide has grossed around 230 million.
06:43 I think a really important point here, too, and something that has not been discussed as much when it comes to the heiress tour film is Taylor Swift proactively went to SAG-AFTRA and got a waiver or interim agreement.
06:58 That meant that she went to SAG, made sure she met all of their requirements, and was essentially given their permission to create the film in a way that meets the union's demands.
07:08 And so we had an heiress tour premiere, whereas a lot of movies are having premieres that do not have their stars.
07:14 You got Taylor Swift on the red carpet.
07:16 I also think we're going to see long-term impacts as well, even more money coming once it's available to be on streaming.
07:24 We have Netflix, which hosts Miss Americana and the Reputation Stadium Tour.
07:29 Then we see Disney+ with the folklore long-pond sessions, and whichever one it ends up at, I'm sure that's going to be a huge deal.
07:37 I do feel the need to explain what I'm doing because it's not normal.
07:42 You may be wondering what's up with all of these Taylor's versions and these re-recordings.
07:47 In essence, when Taylor Swift first started out, she was under an arrangement that is pretty common across the music industry, where she did not own what's called the masters of her work.
07:58 So that's essentially the copyright of the songs.
08:01 Taylor Swift switched record labels to Republic Records, and Big Machine ended up getting sold, along with Taylor Swift's masters, which she said she has tried to buy for herself, to music mega-manager Scooter Braun.
08:16 So to her, this felt like a huge betrayal that this original discography and the masters belonged to somebody who she really did not like.
08:28 And so then she set out on re-recording so that she would own the masters and basically the ability to license out her songs, perform them as she wishes, and so on.
08:40 People want to stream it. She has frequently broken streaming records. She has the top six songs on the Hot 200 currently from a re-recording.
08:51 However, Taylor Swift has also spooked the music industry, and we've seen that some record companies are now reportedly asking their artists to sign contracts that instead of after five years or seven years or after releasing a certain number of albums, they have the right and ability to re-record.
09:09 Now they have to wait 20 to 30 years.
09:11 Bloomberg has recently estimated that Taylor Swift is now a billionaire based in part on the strength of her music catalog, which again is a fairly rare thing, especially in the day and age of streaming.
09:23 When 1989 came out, that was a huge album for her. That was her biggest album. That was her official foray into pop.
09:30 And so far, Taylor has already outsold 1989 with 1989 Taylor's version.
09:37 I think that we saw a much more serious look at the spending power of women with the heiress tour, which also happened at the same time as the Renaissance tour, which is also incredibly huge tour.
09:50 We saw the Barbie movie as well coming in this summer.
09:53 And I think this is one of the first times that we've seen maybe that wholesale as an economy, we're taking it really, really seriously.
10:00 I don't think there's any one reason that Taylor Swift is more financially successful than other pop stars.
10:07 I think that there are a few overlapping reasons.
10:12 We see a lot of different celebrities that are close to her caliber branching out.
10:17 They're doing things like starting clothing brands, starting makeup brands, starting hair brands.
10:22 She's not doing any of those things. She is singularly focused on the business of being Taylor Swift or as Swifties call her, the music industry.
10:32 [MUSIC]