Music Industry G322 Terminology Test 6 mins- 6 words- offer an example if you can Distribution Portability Web 2.0 Consumption P2P Streaming
Sony Music Entertainment EMI Universal Warner Industry Overview The Music Industry is made up of many people from songwriters, producers, artists, managers, marketing, distribution etc. It is a vast industry but is largely controlled by the record companies The music industry is dominated by the ‘big four’ or the music majors:
According to an IFPI report published in August 2007 the big four accounted for 71.7% of retail music sales This means that they operate in an oligopoly where a few companies control the market. These companies are designed to reach the maximum audience and therefore will also have subsidiary companies that will deal with niche tastes as well as mainstream . Universal for example also own Verve which are a specialist Jazz music company
Other than EMI the majors are conglomerates this means they are a multi industry company and own other companies that are not part of the music industry EG?……………………………………………………….. This makes these companies increasingly dominant. They can also benefit from Horizontal Integration . This is where they can link together their different companies in their portfolio and promote their products= Cross promotion Guitar Hero PS3 Guitar Hero Ring Tones on the Sony Ericcson Music Rights Sony International Read the Simon Cowell article from Your booklet-how does this also show Horizontal integration
Vertical Integration Vertical integration is the degree to which a firm owns its upstream suppliers and its downstream buyers Can self distribute
Synergy Using other companies/outlet to promote artists which are mutually beneficial to both companies. Sales of music through other avenues. Working in partnerships Radio TV New Media Film
Independents These companies operate separately from the majors and often specialise in music genres and may cater for niche audiences. Domino is now one of the longest running and most successful independent record labels in the UK. Artists include: The Artic Monkeys and Franz Ferdinand They don’t have the benefits of synergy and etc but offer artists better deals and are more like partnerships/freedom etc
From the homework article:
How can you benefit from being an independent artist?
Select an independent British Record label and research the following:
Genre of music
What is the benefit of being signed to an indie label? What is the benefit of a major?