Information about Global Music Market
The music industry is the business of music. Although it encompasses the activity of many music-related businesses and organizations, it is currently dominated by the "big four" record groups, a.k.a. "the major labels"/"the majors" — Sony BMG, EMI, Universal and Warner — each of which consists of many smaller companies and labels serving different regions and markets.
When the term is used more broadly, it refers to a range of sub-industries that come from a number of different industrial classifications, including Information and Communication (which includes sound recording and music publishing activities), programming and broadcasting activities (e.g., radio stations), education (e.g., music training schools), Arts, entertainment and recreation, and manufacturing and retail sales (e.g., of musical instruments). In this broader sense, the term usually also encompasses not-for-profit organizations such as Musicians' Unions and writers' copyright collectives and performance rights organisations.
In the 1800s, the music industry was dominated by sheet music publishers. In the United States, the music industry arose in tandem with the rise of blackface minstrelsy. The group of music publishers and songwriters which dominated popular music in the United States was known as Tin Pan Alley. In the early 20th century the phonograph industry grew greatly in importance, and the record industry eventually replaced the sheet music publishers as the industry's largest force.
Just as radio and television did before it, the advent of file sharing technologies may change the balance between record companies, song writers, and performing artists. Bands such as Metallica have fought back against peer-to-peer programs such as the infamous Napster, and the arguments for and against technology to circumvent them - digital rights management systems - remain controversial.
With the re-launch of Napster as a legally licensed download site in 2003 (in the US), along with the advent of Apple Computer's iTunes online music store in the same year, the major record companies have begun to embrace digital downloading as the future of the music industry.
Both Napster and iTunes, with the support of the majors, are promoting a digital music subscription service. This may lead to a fundamental change in the way music is consumed, as a utility that "flows" into a person's house rather than as a commodity that is bought one-by-one. Music may well become purchased 'like water' (Leonhard, 2004), in that people will pay for their monthly consumption of music.
The music groups coordinate the production, licensing, and copyright protection of sound recordings & videos and maintain contracts with recording artists and production companies as well as provide a distribution structure for their various owned and non-owned labels.
Record companies sign, market, publicize, develop and promote as well as provide sales support to the larger distribution companies for their releases and artists.
Labels may comprise a record group which is, in turn, controlled by a music group. As such, a larger umbrella label may have a number of sub-labels releasing music.
Music publishers exist separately (even if sharing the same ultimate holding company or brand name), and they represent the rights in the compositions - i.e. the music as written rather than as recorded.
Record companies and record labels that are not under the control of the Big Four music groups and music publishers that are not one of the Big Four are generally considered to be independent, even if they are part of large corporations with complex structures. Some prefer to use the term indie label to refer to only those independent labels that adhere to criteria of corporate structure and size, and some consider an indie label to be almost any label that releases non-mainstream music, regardless of its corporate structure.
Nielsen SoundScan reported that the big four accounted for 81.87% of the US music market in 2005:[2]
The global market was estimated at $30-40 billion in 2004.[3] Total annual unit sales (CDs, music videos, mp3s) in 2004 were 3 billion.
According to an IFPI report published in August 2005,[4] the big four accounted for 71.7% of retail music sales:
In its June 30, 2000 annual report filed with the SEC, Seagram reported that Universal Music Group was responsible for 40% of worldwide classical music sales over the preceding year.[5]
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Usage
When the term music industry is used in a narrow sense, it refers only to the businesses and organizations that record, produce, publish, distribute, and market recorded music (e.g., music publishers, recording industry, record production companies). This corresponds to the International Standard Industrial Classification (ISIC) that includes sound recording and music publishing activities (J-59).When the term is used more broadly, it refers to a range of sub-industries that come from a number of different industrial classifications, including Information and Communication (which includes sound recording and music publishing activities), programming and broadcasting activities (e.g., radio stations), education (e.g., music training schools), Arts, entertainment and recreation, and manufacturing and retail sales (e.g., of musical instruments). In this broader sense, the term usually also encompasses not-for-profit organizations such as Musicians' Unions and writers' copyright collectives and performance rights organisations.
History
Until the 1700s, the process of composition and printing of music was mostly supported by patronage from the aristocracy and church. In the mid-to-late 1700s, performers and composers such as Wolfgang Amadeus Mozart began to seek commercial opportunities to market their music and performances to the general public. After Mozart's death, his wife (the soprano Constanze Weber) continued the process of commercialization of his music through an unprecedented series of memorial concerts, selling his manuscripts, and collaborating with her second husband, Georg Nissen, on a biography of Mozart.[1]In the 1800s, the music industry was dominated by sheet music publishers. In the United States, the music industry arose in tandem with the rise of blackface minstrelsy. The group of music publishers and songwriters which dominated popular music in the United States was known as Tin Pan Alley. In the early 20th century the phonograph industry grew greatly in importance, and the record industry eventually replaced the sheet music publishers as the industry's largest force.
Just as radio and television did before it, the advent of file sharing technologies may change the balance between record companies, song writers, and performing artists. Bands such as Metallica have fought back against peer-to-peer programs such as the infamous Napster, and the arguments for and against technology to circumvent them - digital rights management systems - remain controversial.
With the re-launch of Napster as a legally licensed download site in 2003 (in the US), along with the advent of Apple Computer's iTunes online music store in the same year, the major record companies have begun to embrace digital downloading as the future of the music industry.
Both Napster and iTunes, with the support of the majors, are promoting a digital music subscription service. This may lead to a fundamental change in the way music is consumed, as a utility that "flows" into a person's house rather than as a commodity that is bought one-by-one. Music may well become purchased 'like water' (Leonhard, 2004), in that people will pay for their monthly consumption of music.
Business structure
The music industry is made up of various elements, including:- Musicians such as singers
- Musical ensembles
- Musicians' Unions
- Composers and songwriters
- Publishers
- Writers' copyright collectives and performance rights organization like ASCAP and BMI (or MCPS and PRS respectively for the UK)
- Record producers
- Record labels
- Record distributors
- A&R
- Royalties
- Business managers
- Band managers
- Tour promoters
- Bookers
- Roadies
The music groups coordinate the production, licensing, and copyright protection of sound recordings & videos and maintain contracts with recording artists and production companies as well as provide a distribution structure for their various owned and non-owned labels.
Record companies sign, market, publicize, develop and promote as well as provide sales support to the larger distribution companies for their releases and artists.
Labels may comprise a record group which is, in turn, controlled by a music group. As such, a larger umbrella label may have a number of sub-labels releasing music.
Music publishers exist separately (even if sharing the same ultimate holding company or brand name), and they represent the rights in the compositions - i.e. the music as written rather than as recorded.
Record companies and record labels that are not under the control of the Big Four music groups and music publishers that are not one of the Big Four are generally considered to be independent, even if they are part of large corporations with complex structures. Some prefer to use the term indie label to refer to only those independent labels that adhere to criteria of corporate structure and size, and some consider an indie label to be almost any label that releases non-mainstream music, regardless of its corporate structure.
Statistics
)
US music market shares, according to Nielsen SoundScan (2005)
- Universal Music Group (France based) — 31.71%
- Sony BMG Music Entertainment, inc. (Japan/Germany based) — 25.61% (13.83% Sony, 11.78% BMG)
- Warner Music Group (USA based) — 15%
- EMI Group (UK based) — 9.55%
- — 18.13%
- Universal Music Group — 29.59%
- Sony BMG — 28.46% (13.26% Sony, 15.20% BMG)
- Warner Music Group — 14.68%
- EMI Group — 9.91%
- independent labels — 27.36%
)
World music market sales shares, according to IFPI (2005)
According to an IFPI report published in August 2005,[4] the big four accounted for 71.7% of retail music sales:
- Universal Music Group — 25.5%
- Sony BMG Music Entertainment — 21.5%
- EMI Group — 13.4%
- Warner Music Group — 11.3%
- independent labels — 28.4%
- Universal Music Group including PolyGram — 21.1%
- Sony Music — 17.4%
- EMI — 14.1%
- Warner Music Group — 13.4%
- BMG — 11.4%
- independent labels — 22.6%
Albums sales and market value
The following table shows album sales and market value in the world in the 1990s–2000s.| N | Country | Album Sales Share | Share of World Market Value |
|---|---|---|---|
| 1 | USA | 37-40% | 30-35% |
| EU | 30-32% | 31-34% | |
| 2 | Japan | 9-12% | 16-19% |
| 3 | UK | 7-9% | 6.4-9.1% |
| 4 | Germany | 7-8% | 6.4-5.3% |
| 5 | France | 4.5-5.5% | 5.4-6.3% |
| 6 | Canada | 2.6-3.3% | 1.9-2.8% |
| 7 | Australia | 1.5-1.8% | 1.5-2.0% |
| 8 | Brazil | 2.0-3.8% | 1.1-3.1% |
| 9 | Italy | 1.7-2.0% | 1.5-2.0% |
| 10 | Spain | 1.7-2.3% | 1.4-1.8% |
| 11 | Netherlands | 1.2-1.8% | 1.3-1.8% |
| 12 | Mexico | 2.1-4.6% | 0.8-1.8% |
| 13 | Belgium | 0.7-0.8% | 0.8-1.2% |
| 14 | Switzerland | 0.75-0.9% | 0.8-1.1% |
| 15 | Austria | 0.5-0.7% | 0.8-1.0% |
| 16 | Sweden | 0.7-0.9% | 0.7-1.0% |
| 17 | Russia | 2.0-2.9% | 0.5-1.4% |
| 18 | Taiwan | 0.9-1.6% | 0.5-1.1% |
| 19 | Argentina | 0.5-0.7% | 0.5-1.0% |
| 20 | Denmark | 0.45-0.65% | 0.5-0.8% |
Singles sales
Physical single sales in the world in the 90s-00s and digital single sales in 2005.| N | Country | Physical Sales Share | Digital Sales Share in 2005 |
|---|---|---|---|
| EU | 34-50% | 13.2% | |
| 1 | Japan | 26-32% | 1.7% |
| 2 | USA | 4-25% | 85% |
| 3 | UK | 14.5-16% | 6.3% |
| 4 | Germany | 9-12% | 5% |
| 5 | France | 4-12.5% | 1.9% |
| 6 | Australia | 1.8-4.6% | 0.48% |
| 7 | Netherlands | 1.3-1.7% | < 0.2% |
| 8 | Belgium | 0.8-1.8% | < 0.2% |
| 9 | Sweden | 0.6-0.96% | < 0.2% |
| 10 | Switzerland | 0.5-0.92% | < 0.2% |
| 11 | Austria | 0.58-0.82% | < 0.2% |
| 12 | Italy | 0.3-1.0% | < 0.2% |
| 13 | Spain | 0.3-0.7% | < 0.2% |
| 14 | Norway | 0.3-0.47% | < 0.2% |
| 15 | Ireland | 0.2-0.5% | < 0.2% |
| 16 | Canada | 0.1-0.6% | < 0.2% |
| 17 | Portugal | 0.01-1.0% | < 0.2% |
| 18 | RSA | 0.02-0.45% | < 0.1% |
| 19 | New Zealand | 0.19-0.29% | < 0.1% |
| 20 | Denmark | 0.10-0.25% | < 0.1% |
Recorded Music Interim Physical Retail Sales in 2005
all figures in millions| COUNTRY | UNITS | VALUE | CHANGE | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Singles | CD | DVD | Total Units | $US | Local Currency | Units | Value | ||
| 1 | USA | 14.7 | 300.5 | 11.6 | 326.8 | 4783.2 | 4783.2 | -5.70% | -5.30% |
| 2 | Japan | 28.5 | 93.7 | 8.5 | 113.5 | 2258.2 | 239759 | -6.90% | -9.20% |
| 3 | UK | 24.3 | 66.8 | 2.9 | 74.8 | 1248.5 | 666.7 | -1.70% | -4.00% |
| 4 | Germany | 8.5 | 58.7 | 4.4 | 71 | 887.7 | 689.7 | -7.70% | -5.80% |
| 5 | France | 11.5 | 47.3 | 4.5 | 56.9 | 861.1 | 669.1 | 7.50% | -2.70% |
| 6 | Italy | 0.5 | 14.7 | 0.7 | 17 | 278 | 216 | -8.40% | -12.30% |
| 7 | Canada | 0.1 | 20.8 | 1.5 | 22.3 | 262.9 | 325 | 0.70% | -4.60% |
| 8 | Australia | 3.6 | 14.5 | 1.5 | 17.2 | 259.6 | 335.9 | -22.90% | -11.80% |
| 9 | Spain | 1 | 17.5 | 1.1 | 19.1 | 231.6 | 180 | -13.40% | -15.70% |
| 10 | Netherlands | 1.2 | 8.7 | 1.9 | 11.1 | 190.3 | 147.9 | -31.30% | -19.80% |
| 11 | Russia | - | 25.5 | 0.1 | 42.7 | 187.9 | 5234.7 | -9.40% | 21.20% |
| 12 | Mexico | 0.1 | 33.4 | 0.8 | 34.6 | 187.9 | 2082.3 | 44.00% | 21.50% |
| 13 | Brazil | 0.01 | 17.6 | 2.4 | 24 | 151.7 | 390.3 | -20.40% | -16.50% |
| 14 | Austria | 0.6 | 4.5 | 0.2 | 5 | 120.5 | 93.6 | -1.50% | -9.60% |
| 15 | Switzerland ** | 0.8 | 7.1 | 0.2 | 7.8 | 115.8 | 139.2 | n/a | n/a |
| 16 | Belgium | 1.4 | 6.7 | 0.5 | 7.7 | 115.4 | 89.7 | -13.80% | -8.90% |
| 17 | Norway | 0.3 | 4.5 | 0.1 | 4.8 | 103.4 | 655.6 | -19.70% | -10.40% |
| 18 | Sweden | 0.6 | 6.6 | 0.2 | 7.2 | 98.5 | 701.1 | -29.00% | -20.30% |
| 19 | India | - | 10.9 | - | 55.3 | 79.2 | 3456.6 | -19.20% | -2.40% |
| 20 | Denmark | 0.1 | 4 | 0.1 | 4.2 | 73.1 | 423.5 | 3.70% | -4.20% |
| Top 20 | 74.5 | 757.1 | 42.8 | 915.2 | 12378.7 | -6.60% | -6.30% | ||
In its June 30, 2000 annual report filed with the SEC, Seagram reported that Universal Music Group was responsible for 40% of worldwide classical music sales over the preceding year.[5]
Music industry organizations
- Recording Industry Association of America aka RIAA
- American Federation of Musicians aka AFM
- American Federation of Television and Radio Artists aka AFTRA
- American Society of Composers, Authors, and Publishers aka ASCAP
- Broadcast Music Incorporated aka BMI
- SESAC
- Alliance of Artists and Recording Companies aka AARC
- Recording Artists' Coalition aka RAC
- Musicians' Union
- SoundExchange
- Country Music Association
- Harry Fox Agency
- Academy of Country Music aka ACM
- MCPS
- Performing Right Society
- National Academy of Recording Arts and Sciences aka NARAS
Further reading
- Krasilovsky, William; Shemel, Sidney: This Business of Music, Billboard Books, ISBN 978-0823077236
- Lebrecht, Norman: When the Music Stops: Managers, Maestros and the Corporate Murder of Classical Music, Simon & Schuster 1996
- Imhorst, Christian: The ‘Lost Generation’ of the Music Industry, published under the terms of the GNU Free Documentation License 2004
- Leonhard, Gerd: Music Like Water - the inevitable music ecosystem
- The Methods Reporter: Music Industry Misses Mark with Wrongful Suits
- Music CD Industry - a mid-2000 overview put together by Duke University undergraduate students
- d’Angelo, Mario: Does globalisation mean ineluctable concentration ? in The Music Industry in the New Economy, Report of the Asia-Europe Seminar, Lyon, 25-28 oct. 2001, IEP de Lyon/Asia-Europe Foundation/Eurical, Editors Roche F., Marcq B., Colomé D., 2002, pp. 53-54.
- d'Angelo, Mario: Perspectives of the Management of Musical Institutions in Europe, OMF, Musical Activities and Institutions Sery, ParisIV-Sorbonne University, Ed. Musicales Aug. Zurfluh, Bourg-la-Reine, 2006.
References
1. ^ Dear Constanze The Guardian
2. ^ Paul Cashmere (2006-01-05). Universal Is The Biggest Music Company of 2005. Undercover (Australia). Retrieved on 2006-05-27.
3. ^ According to the RIAA the world music market is estimated at $40 billion, but according to IFPI (2004) it is estimated at $32 billion.
4. ^ IFPI releases definitive statistics on global market for recorded music
5. ^ BUSINESS AND PROPERTIES The Seagram Company Ltd.
2. ^ Paul Cashmere (2006-01-05). Universal Is The Biggest Music Company of 2005. Undercover (Australia). Retrieved on 2006-05-27.
3. ^ According to the RIAA the world music market is estimated at $40 billion, but according to IFPI (2004) it is estimated at $32 billion.
4. ^ IFPI releases definitive statistics on global market for recorded music
5. ^ BUSINESS AND PROPERTIES The Seagram Company Ltd.
See also
- List of record labels and
- Best selling music artists - World's top-selling music artists chart.
External links
- http://www.musicindustrylinks.com - Online Music Industry Links Directory
- http://www.themusicconnect.com - Music industry tips and advice
- http://www.move.de/amm/ECON.htm - CD-Markets size in 1996
- http://www.zobbel.de/ - World records sales in years 1994/95/97/98.
- http://www.HitQuarters.com - World Top 20 A&R Chart
- http://www.TheMusicSnob.com - Music industry wiki by and for musicians.
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Sony BMG Music Entertainment, Inc.
Joint venture
Founded August 5, 2004
Headquarters New York City, USA
see List of Sony BMG offices
Key peopleAndrew Lack
Chairman of the Board of Directors
Rolf Schmidt-Holtz
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Joint venture
Founded August 5, 2004
Headquarters New York City, USA
see List of Sony BMG offices
Key people
Chairman of the Board of Directors
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EMI Group PLC
Public (LSE: EMI )
Founded 1931
Headquarters London, England, UK
Key people Eric Nicoli, CEO
Martin Stewart, CFO
Industry Music
Revenue £2.07 billion (2006)
Net income £724.
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Public (LSE: EMI )
Founded 1931
Headquarters London, England, UK
Key people Eric Nicoli, CEO
Martin Stewart, CFO
Industry Music
Revenue £2.07 billion (2006)
Net income £724.
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Universal Music Group
Subsidiary of Vivendi
Founded 1934 (as Decca Records USA)
1990 (MCA Music Entertainment Group formed)
1997 (first UMG incarnation)
1998 (second UMG incarnation)
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Subsidiary of Vivendi
Founded 1934 (as Decca Records USA)
1990 (MCA Music Entertainment Group formed)
1997 (first UMG incarnation)
1998 (second UMG incarnation)
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Warner Music Group Corporation
Public (NYSE: WMG )
Founded 2003
Headquarters New York, NY, U.S.
Key people Edgar Bronfman, Jr., Chairman & CEO
Industry Music & Entertainment
Revenue $3.502 Billion (USD; 2006)
Net income $169.
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Public (NYSE: WMG )
Founded 2003
Headquarters New York, NY, U.S.
Key people Edgar Bronfman, Jr., Chairman & CEO
Industry Music & Entertainment
Revenue $3.502 Billion (USD; 2006)
Net income $169.
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The International Standard Industrial Classification of All Economic Activities is a United Nations system for classifying economic data. The United Nations Statistics Division describes it in the following terms:
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The International Standard Industrial Classification of All Economic Activities is a United Nations system for classifying economic data. The United Nations Statistics Division describes it in the following terms:
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- There are several organizations calling themselves the Musicians' Union:
- For the United Kingdom, see: Musicians' Union (UK)
- For the United States of America, see listing by state:
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A copyright collective (also known as a copyright collecting agency or copyright collecting society) is a body created by private agreements or by copyright law that collects royalty payments from various individuals and groups for copyright holders.
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Performance rights organizations (PROs) provide intermediary functions, particularly royalty collection, between copyright holders and parties who wish to use copyrighted works publicly such as shopping and dining venues.
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Patronage is the support, encouragement, privilege and often financial aid given by a person or an organization. It can also refer to the right of bestowing offices or church benefices, the business given by a regular customer, and the guardianship of saints.
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aristocracy refers to a form of government where power is held by a small number of individuals from a social elite or from noble families. The transmission of power is often hereditary.
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religion is a set of common beliefs and practices generally held by a group of people, often codified as prayer, ritual, and religious law. Religion also encompasses ancestral or cultural traditions, writings, history, and mythology, as well as personal faith and mystic experience.
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Wolfgang Amadeus Mozart (IPA: [ˈvɔlfgaŋ amaˈdeus ˈmoːtsart], baptized Joannes Chrysostomus Wolfgangus Theophilus Mozart
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Constanze Mozart (born Constanze Weber) (5 January 1762; Zell im Wiesental, Germany – 6 March 1842; Salzburg), was a soprano singer of the Classical era, the mother of two surviving children, and the wife of Wolfgang Amadeus Mozart.
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Sheet music is a hand-written or printed form of musical notation; like its analogs -- books, pamphlets, etc. -- the medium of sheet music typically is paper (or, in earlier times, parchment), although the access to musical notation in recent years includes also presentation on
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Motto
"In God We Trust" (since 1956)
"E Pluribus Unum" ("From Many, One"; Latin, traditional)
Anthem
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"In God We Trust" (since 1956)
"E Pluribus Unum" ("From Many, One"; Latin, traditional)
Anthem
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Blackface is a style of theatrical makeup that originated in the United States, used to affect the countenance of an iconic, racist American archetype—that of the darky or coon.
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minstrel show, or minstrelsy, was an American entertainment consisting of comic skits, variety acts, dancing, and music, performed by white people in blackface or, especially after the American Civil War, African Americans in blackface.
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Tin Pan Alley is the name given to the collection of New York City-centered music publishers and songwriters who dominated the popular music of the United States in the late 19th century and early 20th century.
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twentieth century of the Common Era began on January 1, 1901 and ended on December 31, 2000, according to the Gregorian calendar. Some historians consider the era from about 1914 to 1991 to be the Short Twentieth Century.
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Edison cylinder phonograph ca. 1899]] The phonograph, or gramophone, was the most common device for playing recorded sound from the 1870s through the 1980s.
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Terminology
Usage of these terms is not uniform across the English-speaking world (see below)...... Click the link for more information.
The record industry is the part of the music industry that earns profit by selling sound recordings of music. In the early years of the phonograph in the late 19th century, the music industry was dominated by the publishers of sheet music.
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Radio is the wireless transmission of signals, by modulation of electromagnetic waves with frequencies below those of visible light. Electromagnetic radiation travels by means of oscillating electromagnetic fields that pass through the air and the vacuum of space.
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- See Shared resource for the conventional meaning of file sharing
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Napster was a file sharing service that paved the way for decentralized P2P file-sharing programs such as Kazaa, Limewire, iMesh, Morpheus, and BearShare, which are now used for many of the same reasons and can download music, pictures, and other files.
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Digital rights management (DRM) is an umbrella term that refers to access control technologies used by publishers and other copyright holders to limit usage of digital media or devices.
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Apple Inc.
Public (NASDAQ: AAPL , LSE: ACP , FWB: APC )
Founded California (April 1 1976, as Apple Computer, Inc.)
Headquarters 1 Infinite Loop, Cupertino, California
Key people Steve Jobs, CEO & Co-founder
Steve Wozniak, Co-founder
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Public (NASDAQ: AAPL , LSE: ACP , FWB: APC )
Founded California (April 1 1976, as Apple Computer, Inc.)
Headquarters 1 Infinite Loop, Cupertino, California
Key people Steve Jobs, CEO & Co-founder
Steve Wozniak, Co-founder
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Maintainer: Apple Inc.
OS: Mac OS X (10.3+) , Windows XP, and Vista[1]
Use: Media player
License: Proprietary (freeware)
Website: Apple's Official iTunes Website
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OS: Mac OS X (10.3+) , Windows XP, and Vista[1]
Use: Media player
License: Proprietary (freeware)
Website: Apple's Official iTunes Website
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The subscription business model is a business model that was pioneered by magazines and newspapers, but is now used by many businesses and websites. Rather than selling products individually, a subscription sells periodic (monthly or yearly or seasonal) use or access to a product
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