Music Industry

3.3999999999925 (1515)
Posted by motoman 03/15/2009 @ 09:08

Tags : music industry, entertainment, business

News headlines
NASHVILLE SKYLINE: Music Industry's Future Parallels That of ... -
There are current parallels between the dilemmas facing both the newspaper industry and the music industry. Recent articles by Clay Shirky and Frank Rich on newspapers' dilemma show that print journalism's days of anything resembling its present form...
Study to music industry: embrace P2P -
A report due to be published this Friday urges the music industry to embrace P2P rather than fight it. The report, which will be published in full this weekend at the Great Escape Festival in the UK, is reported to debunk the “Long Tail” theory,...
How the ipod changed everything - Scripps News
While the global music industry bled revenue, Apple Computers Inc., AAPL-Q as it was then known, locked down the digital-music scene with the introduction of the ipod and itunes software and, two years later, the launch of itunes Music Store....
New council to promote city's music industry -
Some of Nashville's heaviest hitters in the entertainment industry are coming together in a new Music Business Council, Mayor Karl Dean announced. The council, similar to those formed to support the technology and health care communities, will promote...
Music industry mining some revenue from YouTube - Los Angeles Times
Thanks to a revenue ad sharing model that launched on the video site a couple of years ago that has earned some cash for indie video producers, the music industry is collecting a relatively small but steady stream of revenue....
Music Industry So Weak You Only Need To Sell 83000 To Be No. 1 - The Business Insider
It seemed as if album sales were improving slightly as they were only down 9% in April year over year, compared to 17.9% and 11.5% in February and March. But Michele's first-week total is a disappointing start to May for the music industry....
Nashville Stars Help Mayor - Pollstar
Dean said it's important to protect the city's brand and position as “Music City,” and to “keep creative people here and attract people to the city and help our tax base.” He added that, "The key message I'm trying to get across to the music industry...
Why country-pop singer Taylor Swift matters -
but he was once an immensely talented little boy who turned the music industry's collective head. Stevie Wonder, who weathered the fame storm much better, made indelible impressions on popular music and remains one of the country's best-loved artists....
Ink-stained Politicians - Wall Street Journal
The shipping industry changed radically with the advent of containerization. Wal-Mart's state-of-the-art inventory management transformed retailing. Apple's iTunes has revolutionized the music industry. Some new business model will emerge for...

Music industry

US music market shares, according to Nielsen SoundScan (2005)

The music industry (or music business) sells compositions, recordings and performances of music. It employs about a quarter of million people, including: the musicians who compose and perform the music; the companies and professionals who create and sell recorded music (e.g., music publishers, producers, studios, engineers, record labels, retail and online music stores, performance rights organizations); those that present live music performances (booking agents, promoters, music venues, road crew); professionals who assist musicians with their careers (talent managers, business managers, entertainment lawyers); those who broadcast music (satellite and broadcast radio); journalists; educators; musical instrument manufacturers; as well as many others.

In the late 19th century and early 20th century, the music industry was dominated by the publishers of sheet music. By mid-century records had supplanted sheet music as the largest player in the music business. Since 2000, sales of recorded music have dropped off substantially, while live music has increased in importance.

There are four "major labels" that dominate recorded music — Sony Music Entertainment, EMI, Universal and Warner — each of which consists of many smaller companies and labels serving different regions and markets. The live music industry is dominated by Live Nation, the largest promoter and music venue owner. Live Nation is a former subsidiary of Clear Channel Communications, which owns a majority of the radio stations in the United States. Other important music industry companies include Creative Artists Agency (a management and booking company) and Apple Inc. (which runs the world's largest online music store, iTunes Music Store, and sells the iPod).

Until the 1700s, the process of composition and printing of music was for the most part supported by patronage from aristocracies and churches. 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 (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. 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. A multitude of record labels came and went, but a handful of label corporations prospered for decades. By the end of the 1980s, the "Big 6" — EMI, Sony, BMG, PolyGram, WEA and MCA — dominated the industry. In mid-1998, PolyGram merged into Universal Music Group (formerly MCA), dropping the leaders down to a "Big 5". They became the "Big 4" in 2004 when Sony merged with BMG.

The advent of file sharing technologies has changed 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 dawn of Apple Inc.'s iTunes online music store in 2003, legal music downloads became widely available.

The music industry is made up of various players, including individuals, companies, unions, not-for-profit associations, and rights collectives, and other bodies. Professional musicians, including band leaders, rhythm section members, musical ensembles, singers, conductors, and arrangers, and sound engineers create sound or video recordings of music or create live performances in venues ranging from small clubs to stadiums. Professional musicians negotiate their wages, contractual conditions, and other conditions of work through Musicians' Unions or other guilds. Composers and songwriters write the music and lyrics to songs and other musical works, which are sold in print form as sheet music or scores by music publishers. Composers and performers get part of their income from writers' copyright collectives and performance rights organization such as the ASCAP and BMI (or MCPS and PRS respectively for the UK). These societies and collectives ensure that composers and performers are compensated when their works are used on the radio or TV or in films. When musicians and singers make a CD or DVD, the creative process is coordinated by a record producer, whose role in the recording may range from suggesting songs and backing musicians to having a direct hands-on role in the studio, coaching singers, giving advice to session musicians on playing styles, and working with the senior sound engineer to shape the recorded sound through effects and mixing.

Most professional musicians, bands, and singers are signed with record labels, which are companies which finance the recording process in return for part or full share of the rights in the recording. A record company is an entity that manages sound recording-related brands and trademarks which consist of their owned labels; their owned and licensed master recordings; and various related ancillary businesses such as home video and DVDs. 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 these four groups are generally considered to be independent or "indie" labels, even if they are part of large, well-financed corporations with complex structures. Some music critics 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. According to US Market Research Firm NPD Group, iTunes recently surpassed Wal-Mart as America's largest music distributor. A record distributor is a company (often a record label) that works with record labels to promote and distribute their records, either in their home market or overseas.

Once a CD is recorded, record distributor companies organize the shipping of the CDs to music stores and department stores. Record labels have use an "A&R" (Artists and Repertoire) manager to help develop the performing style of bands and singers signed the label. A&R managers may organize shared tours with similar bands or find playing opportunities for the label's groups which will broaden their musical experience. For example, an A&R manager may decide to send an emerging young singer-songwriter with little live playing experience on a major tour with an established electric folk rock act from the same label, so that this person will gain more confidence.

When CDs sell in stores or on websites such as iTunes, part of the money is returned to the performers in the form of royalties. Most recordings only earn royalties for a short period after they are released, after which the song becomes part of the "back catalogue" or library. A much smaller number of recordings have become "classics", with longstanding popularity, such as albums by the Beatles or the Rolling Stones. These albums have continued to earn royalties for the surviving band members decades after their original release date.

Successful artists will hire a number of people from other fields to assist them with their career. The band manager oversees all aspects of an artist's career in exchange for a percentage of the artist's income. An entertainment lawyer assists them with the details of their contracts with record companies and other deals. A business manager handles financial transactions, taxes and bookkeeping. A booking agency represents the artist to promoters, makes deals and books performances. A travel agent makes travel arrangements. A road crew is a semi-permanent touring organization that travels with the artist. This is headed by a tour manager and includes staff to move equipment on and off-stage, drive tour buses or vans, and do stage lighting, live sound reinforcement and musical instrument tuning and maintenance. The tour manager's tasks can vary widely depending on the type of tour and where the group is playing. The tour manager's typical tasks of ensuring that hotel, restaurant and travel arrangements are confirmed may expand into other tasks, if the venue where the band is playing does not have certain equipment. If the venue lacks a grand piano or Hammond organ that the band needs for the show, the tour manager will be responsible for finding a rental instrument for the show and having it moved onstage; as well, if a band member needs an emergency instrument repair, the tour manager and/or the guitar tech will help to find a repair person or replacement instrument. The most high-profile celebrity performers may also have personal assistants, a chef, and bodyguards. Singers may hire a vocal coach to give them suggestions on how to take care of their voice or develop their singing range.

The global market was estimated at $30-40 billion in 2004. Total annual unit sales (CDs, music videos, mp3s) in 2004 were 3 billion.

Note: the IFPI and Nielsen Soundscan use different methodologies, which makes their figures difficult to compare casually, and impossible to compare scientifically.

According to the IFPI more than 95% of the total revenue from music in 2003 was derived from the 30 major countries in the proportions shown above.

The following table shows album sales and market value in the world in the 1990s–2000s.

Physical single sales in the world in the 1990s-2000s and digital single sales in 2005.

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.

To the top

2000s in music industry

Various technological and social changes at the dawn of the 21st century have impacted the music industry, including advents in digital technology, the wide-scale acceptance of broadband and the ever decreasing cost of hard drive space. These conditions have forced surviving industry players to discard old profit and sales formulas. Furthermore, the open nature of the internet has allowed consumers unparalleled choice in music consumption, which opened up performers to niche markets to which they previously had little access.

The initial stage of the digital music revolution was the emergence of illegal P2P networks that engaged in copyright infringment. It wasn't until years later that internet offered legitimate free media.

In 2008, 123m physical albums were sold in the UK compared with 131m in 2007 and 151m in 2006. At an average price of £7.72, CDs were more than 25 percent cheaper in 2008 than in 2000.

Many industry players were not able to make the transition into the digital era. Many were preoccupied with issues of digital piracy and protecting copyrights, rather than seeing the potential of digital media as a legitimate distribution tool. Little thought was given to seeing consumers preference for the convenience and low cost of digital media and trying to create value in the digital sector, instead attention was and is focused on creating legislative and technological barriers to distribution over this medium.

The transition from CDs to digital downloads have been shrinking the record industry most of the decade, leading to mass layoffs, and artist-roster cuts at major labels.CD sales have dropped 48.9 percent since 2000. Approximately 2,680 record stores have closed since 2005.

Napster was an online music file sharing service created by Shawn Fanning while he was attending Northeastern University in Boston and operating between June 1999 and July 2001. Its technology allowed people to easily copy and distribute MP3 files among each other, bypassing the established market for such songs and thus leading to the music industry's accusations of massive copyright violations.

The first peer-to-peer case was A&M Records v. Napster, 239 F.3d 1004 (9th Cir. 2001).

The court found that Napster was contributorily liable for the copyright infringement of its end-users because it "knowingly encourages and assists the infringement of plaintiffs' copyrights."and that Napster did receive a financial benefit, and had the right and ability to supervise the activity, meaning that the plaintiffs demonstrated a likelihood of success on the merits of their claim of vicarious infringement. The court denied all of Napster's defenses, including its claim of fair use. Although the original service was shut down by court order, it paved the way for decentralized peer-to-peer file-distribution programs, which have been much harder to control.

A number of studies have found that file sharing has a negative impact on record sales. Examples of such studies include three papers published in the April 2006 issue of the Journal of Law and Economics (Liebowitz, Rob and Waldfogel, Zentner). Alejandro Zentner notes in another paper published in 2005, that music sales have globally dropped from approximately $38 billion in 1999 to $32 billion in 2003, and that this downward trend coincides with the advent of Napster in June 1999. Using aggregate data Stan J. Liebowitz argues in a series of papers (2005, 2006) that file sharing had a significant negative impact on record sales.

However, a widely cited paper published in February 2007 concludes that file sharing has no negative effect on CD sales. This paper by Olberholzer-Gee and Strumpf, was published in the Journal of Political Economy, and is the only paper which analyzes actual downloads on file sharing networks. Data gathered from tracking downloading on OpenNap servers indicates that most users logged on very rarely and when they did log on they only downloaded a little more than one CD’s worth of songs. To show how these downloads affected album sales they tracked sales and downloads of 500 random albums of varying genres and after doing so found that illegal downloads would only be a small force in the decrease in album sales, possibly even slightly improving album sales of the top albums in stores at the time. CNET staff writer John Borland reports, “even high levels of file-swapping seemed to translate into an effect on album sales that was "statistically indistinguishable from zero".

After years of suing thousands of people for allegedly stealing music via the Internet, the recording industry is set to drop its legal assault as it searches for more effective ways to combat online music piracy.The decision represents an abrupt shift of strategy for the industry, which has opened legal proceedings against about 35,000 people since 2003. Critics say the legal offensive ultimately did little to stem the tide of illegally downloaded music. And it created a public-relations disaster for the industry, whose lawsuits targeted, among others, several single mothers, a dead person and a 13-year-old girl.Instead, the Recording Industry Association of America said it plans to try an approach that relies on the cooperation of Internet-service providers.

With the explosion of formats and the creation of legitimate digital content, the IFPI observes the three main business models have rose to dominance. They are a-la-carte, subscription service, and advertisement based .

Rolling Stone reported a price war between MP3 stores, iTunes and Bill Carr, vice president of digital media for mentioned the following of digital music "one of the great benefits of the digital business versus the CD business is that we can experiment with price changing for an hour, a day or how ever long we like, with no impact on inventory".

YouTube (owned by Google Inc.) is the premier site for finding music videos for both independent bands and mainstream bands that have released their music on CD or digitally, while also being useful for finding rare songs. YouTube provides content that is both music and non-music, so it is difficult to say how much entertainment it has provided to music consumers, however it did provide about one-third of all 11 billion online video views in the US in the month of April 2008.

The site is also testing three new landing pages dedicated to the popular categories of news, movies, and music. Each page will be populated with the most popular content on the site related to that category. Some have even hailed YouTube as being the "digital successor to MTV" as they seem to be positioning themselves in that manner. Currently, they have mixed relations with labels as evidenced by their icy relationship with Warner Music Group but more optimistic relationship with Universal Music.

MySpace (owned by Fox Interactive Media) is also a key player and Rolling Stone reports that it hosts more than 70 million users monthly and that “visitors to the site can hear both Bob Dylan’s or The White Stripes' entire catalogue”. MySpace also made copyright deals with the RIAA's "Big Four", which is Sony BMG, Warner Music Group, Universal Music and EMI , in September 2008. In January 2009, MySpace made partnerships with the following independent labels: Nettwerk, INgrooves, Iris Distribution, RoyaltyShare, and Wind-up Entertainment. In March 2009, CNET News reported that there are more than 5 million bands with music on the streaming-and-discovery music service, and more than 100 million playlists have been created .

Pandora Internet Radio is distinctive from both YouTube andMySpace in that it offers consumers continuously streaming media rather than "on-demand" file serving, which makes it highly similar to radio or television. However, it can be contrasted with radio in that it offers music recommendation. YouTube is similar to Pandora in that it also offers recommendation, but is distinct in that content is user-generated.

This trend has broader implications in the use of formats. It has been a trend in music, television, movies, and print. The Recording Industry Association of America(RIAA) reported data on the music industry’s sales by format over the ten-year period from 1998 until 2007. The data in the table below is from the 2007 report.

In 2008, physical album sales fell 20 percent to 362.6 million from 450.5 million, while digital album sales rose 32 percent to a record 65.8 million units.

Five years ago music distribution formats were numbered in single figures – today, they number in the hundreds…In the digital era, record companies are licensing music across a multitude of platforms, in scores of different formats and with hundreds of different partners.

The 21st century saw the decline of CD players and cassette players as result of decline in CD and cassette distribution, respectively.

Rise of MP3 players, which are consumer electronics devices that stores, organizes and plays audio files. Some DAPs (digital audio players) are also referred to as portable media players as they have image-viewing and/or video-playing support. The first mass-produced DAP was created in 1997 by SaeHan Information Systems, which domestically sold its “MPMan” player in the middle of 1998. In October 2001, Apple Computer (now known as Apple Inc.) unveiled the first generation iPod, the 5 GB hard drive based DAP with a 1.8" Toshiba drive. With the development of a minimalistic user interface and a smaller form factor, the iPod was initially notable within users of the Macintosh community. In July 2002, Apple introduced the second generation update to the iPod. It was compatible with Windows computers through Musicmatch Jukebox (now known as Y!Music Musicmatch Jukebox). The iPod series, which grew to include microdrive and flash-based players, has become the market leader in DAPs.

The 21st century saw the birth of 3G enabled mobile phones, which enables network operators to offer users a wider range of more advanced services while achieving greater network capacity through improved spectral efficiency.

The key advantage of 3G enabled phones over MP3 players is their greater web integration. This enables users to readily access a far larger quantity of songs than MP3 player users can. For an MP3 player, songs must be stored before the user leaves their computer, but with 3G enabled phones the device is not separated from the source. It is projected that revenue from mobile media and entertainment (MME) services in the US will more than double during the next five years.

To the top

Music Industry Arts

The Music Industry Arts Program at Fanshawe College was the first school of its kind in Canada, (and one of the first 3 in the world), to train young people for careers in the contemporary music industry.. Started in 1970 as Creative Electronics by former Radio Caroline DJ Tom Lodge, but when the college demanded that Creative Electronics become a career program, he had the students build a recording studio, gathered music industry executives for an advisory group and changed the name of the program to Music Industry Arts. The program has been the starting point for hundreds of the world's top recording engineers, record producers and entertainment industry executives.

To the top

Source : Wikipedia