Us Music Industry
Us Music Industry
Industry brief: Music recording
In the music business is one is a set of recording companies that produce over 20,000 new recordings each year, The object of the recording companies is to get these titles on the shelves of retailers and then to get them off the shelves into the hands of the public.

These shelves are very full. And not only are recordings in every type of music contending for shelf space, but they are also contending with over 100,000 backlisted titles. So that the Black Crowes are not only competing with Eminem for space in the Tower Records shelves; they are also fighting with five decades of predecessors from Chuck Berry and the Beatles through to Metallica and Aerosmith.

It costs several million dollars to record and launch any major new pop album these days. And audience tastes are unpredictable, so many of these launches are for naught. Music companies are saved by the occasional big hit among the many flops. But winning shelf space and mind space while prolonging shelf life is harder than it’s ever been. And now comes a new threat – digital distribution of music over the Internet, as fans have been sharing recordings and avoid buying recordings off the shelves.

Music then is in transition. It’s going from a tangible that you buy off the shelves to an intangible, something that’s on the Net and available to anyone who can in turn record them on tape or CD. This “de-materialization” of music has the big five companies worried, and with good reason. Will music stop being a product and return to being a service?

The Big Five
In the last ten years, the rate of concentration in the $40 billion music industry has been breathtaking. Five companies have taken over vertical and horizontal control over almost every aspect of the industry. These five own virtually every record label you can name — a curious leftover term from when music came on vinyl records with actual paper labels in the center). Many of these labels with histories back to the Victrola days (like RCA Victor and Parlophone) are now under the control of a handful of international entertainment conglomerates that have learned to prolong shelf life and dominate shelf space ruthlessly. Although changes in the way music is delivered are a threat to the giants, they have the financial, legal, and technological muscle to minimize their losses and maximize their gains.

There a are five major record label conglomerates, who control over 80% of all the titles produced in the United States and comparable percentages in the rest of the world. They are Warner Music, EMI Group, Universal Music Group (UMG), Bertelsmann Music Group (BMG) and Sony. These also own distribution companies that control over 80% of the wholesale market. They are also becoming a bigger presence in the retail sale of recordings. Furthermore, they have rights to much of the copyrighted music, often not the artists who originally wrote the music. The oligopolies are growing and concentrating. And it seems every time an independent begins to build new markets, it soon gets bought out by one of the big guys

The pace of consolidation is increasing. A few years ago there were a big six in the industry UMG (Universal Music Group) is a merger of Polygram and MCA brought about in 2000 by Seagram/Universal which in turns has been taken over by French media/water conglomerate Vivendi (now dissolving). Time Warner and EMI announced merger plans in 2000, but that was held up by European antitrust laws. It’s not hard to imagine that one or more of the remaining companies will get swallowed up by another. There are steady rumors, for example, that BMG is looked to be sold or merged.

Of course, Universal Music Group is on the block, the biggest of them all. While it is unlikely for antitrust reasons and cash flow problems that any of the others will take over UMG, neither do they want an energized new competitor. After all, UMG is the largest of them all, and has been growing steadily in sales volume, even in the downturn.

But UMG has few suitors, and the reason is the general decline of the business. From 1988 to 1996 the industry grew at a rate of 8% a year. Since 1996 it has shrunk by a total of 17%. The two reasons are music piracy and just plain unexciting music from the recording companies, though they will never admit the latter.

The Internet has and will continue to be a great disruptor in the industry, All the threats by Senator Hatch and the recording industry trade group, all the lawsuits against individual college students, will not work. The industry shut down Napster, but file sharing has found other routes. The only sane moves by the industry have been to finally enable reasonable file download services, such as Apple’s, but they may be too little too late. The industry looks

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Music Industry And Music Recording. (July 6, 2021). Retrieved from https://www.freeessays.education/music-industry-and-music-recording-essay/