The BIG THREE in the Music Industry

The Big Three often refers to the 3 major record labels in the music industry. They are Universal, Sony and Warner. In the 1980s, the Big Six ruled the industry, and little by little they started consolidating. Is the consolidation of the record labels good for the music industry? Or are we just making way for an even bigger problem in the future of music?

History

The BIG SIX

In 1980’s the Big Six consisted of EMI, CBS, BMG, PolyGram, WEA, and MCA. There were more smaller and significant labels at the time, but these were the top dogs of the music industry. In this decade, MTV began streaming video clips, and the CD became firmly established. Michael Jackson’s “Thriller” album was also released during this time, sold 40 million copies world wide, and became the most successful product in the history of recorded sound. Towards the end of the 80s, Sony bought CBS records, and named it Sony Music (MacQuarrie, 2000).

The BIG FIVE

The Big Six dominated the music industry until 1999, when PolyGram defunct, and as a result merged with MCA to form Universal Music Group, which is the label with the most control as of now in the industry. During the Big Five era, we were introduced to the mp3 format, and music piracy became a “normal” activity among everyday people (Garrit, 2003).

The BIG FOUR

As music piracy was at an all time high, thanks to programs such as Napster, and Limewire, the record labels struggled for solutions and legal actions. Amidst of this music economics crisis, in 2004 Sony Music acquired BMG, and the Big Five were suddenly the Big Four. This is when the music industry started adopting business strategies. Less and less were record labels signing artists they believed in; they simply couldn’t afford it. Music executives only invested expensive deals to artists who could guarantee a return of investment (Garrity, 2003).

And then there were three. Earlier this year, two major record labels consolidated, again. EMI was bought by Universal Music Group in September, giving more power to the record labels that are left. These major music company now monopolize the music industry. Right now, they are all figuring out an economic model to earn higher profits.  What’s the pros and cons of the Big Three? Are these business decisions a temporary save, or is it going to be just the Big Three for a while?  What do you see in the future of the music industry?

This is open for discussion so please comment. We will analyze the Big Three more in depth next month.

Garrity, B., & Christman, E. (2003). Big Five On Way To Three. (Cover story). Billboard, 115(46), 3-85.

MacQuarrie, R. & et al. (2000) Music CD Industry. Page is: http://www.soc.duke.edu/~s142tm01/history.html

The State of the Music Industry

Creative Methods to Sell Your Music

The days when musicians and their record labels could rely on selling their albums through traditional record stores are gone. Today, very few musicians get the opportunity to have a multi-million dollar campaign as their force to distribute and sell their music. Your team has to learn to do it themselves. Artists, manager and their labels need to start finding creative ways to disburse their music.

Veronica Belmont's interview with music industry professional Ethan Kaplan

For today’s blog post, I decided to write about a video I found of an interview. Veronica Belmont “Tech Talks” with Ethan Kaplan, who during the time was Vice President of technology at Warner Bros. Records, about the music industry. Although the video is about 4 years old, I found the information valuable and applicable for today’s industry.

What's the Deal with Music Publishing?

Music publishing is incredibly similar to the big record labels. Aside from royalties, licensing deals and administrating copyrights, music publishing involves the recording and selling of songs, just like record labels do. So what's the deal with music publishing? Simply, the business of recording music is getting weaker as the music publishing business is becoming stronger. A revenue collecting company for songwriters called SongTrust states that the importance of music publishing has increased during recent years. The Internet has made an abundant amount of music distribution methods. The digital media has caused a much wider audience to be reached, and the payments from these audiences increase the publishing revenues.

The End of the A&R Era?

Possibly. A&R back in the day were considered creative people who had some sense of power over pop culture. They knew the dos and don’ts of commercial success, and they were responsible for scouting talent for their record label. They would go spend their evenings in nightclubs to listen and discover new artists or bands, and help them develop.  Nowadays, however, the talent needs to have some sort of momentum before A&R even consider getting involved. Once an artist achieves this momentum, they go straight to the contract without the need of an A&R.