What is Your Role in the Music Business Industry?
What is Your Role in the Music Business Industry?
There are lots of record labels in the music industry, but when you go through each one of them you will realize that few companies that owns most of the labels dominate this business industry. You can’t be a serious music fan and resist to this domination and you will clearly see the differences between major labels and independent labels in terms of quality of content and style. It is true that those major companies have more money and greater control but they have also their disadvantages, the main one being the lack of creativity and the focus on business instead of music. In search of more commercial content, most of the songs we listen to everyday are about specific topics that are sometimes taboo in some societies and it is important to study their influence on listeners. Finally, the online music stores are taking over the traditional ones and it is important to look at the consequences.
I went through my digital music library, selected randomly 10 music CDs, searched for their record labels and I realized that they are all owned by one of the big four companies controlling the music business industry: Vivendi, EMI, Sony and Warner.
Artist
Album
Record Label
Parent Company
Florence and the Machine
Lungs
Island Records
Vivendi
David Guetta
Nothing But the Beat
What A Music
EMI
Coldplay
A Rush of Blood to the Head
Capitol
EMI
The Script
The Script
Sony
Sony
Seal
Soul
Warner Bros Records
Warner
Jason Mraz
We Sing. We Dance. We Steal Things.
Atlantic Recording
Warner
Green Day
21st Century Breakdown
Reprise Records
Warner
Robbie Williams
Escapology
Chrysalis Records
EMI
Eminem
Recovery
Aftermath Records
Vivendi
Black Eyed Peas
The Beginning
Interscope Records
Vivendi
According to Warren Cohen (2004), the typical price of a new music album is $15.99 and the table below shows the breakdown of this cost and of the 10 CDs I chose randomly. We can clearly see that selling a CD generates more profit to the label than the artist or the retailer. Moreover, since I downloaded illegally those 10 albums for free I incurred a loss of $17.0 to the label, $16.0 to the artist and $8.0 to the retailer. I’m not proud of it, but in the mean time why would you buy something when you can get it for free? Of course, this question is subject to a great discussion I am not going to cover.
 Cost Breakdown
1 CD
10 CDs
Musician’s Union
$0.17
$1.7
Packaging/Manufacturing
$0.80
$8.0
Publishing Royalties
$0.82
$8.2
Retail Profit
$0.80
$8.0
Distribution
$0.90
$9.0
Artists’ Royalties
$1.60
$16.0
Label Profit
$1.70
$17.0
Marketing/Promotion
$2.41
$24.1
Label Overhead
$2.91
$29.1
Record Overhead
$3.89
$38.9
Total
$15.99
$159.9
With the four major companies controlling 75% of the music business industry (Daily Telegraph, 2009) it is becoming more difficult to be a music fan and resist to this domination: Artists are more attracted by signing deals with one of the big four because it will make it easier for them to reach a greater audience and will help them benefit from promotion on a larger scale.
Despite the fact that the music industry is control by few major companies that have greater money power and connections, independent records produce music of higher quality: The big four have to produce music faster and in larger quantity than the smaller record labels which therefore lower the quality of their music (theredwallstore.com, 2007). In addition to that, independent music labels focus more on signing contracts with talented musicians and artists while major companies focus on good-looking artists that would sell more and satisfy the mainstream demand (theredwallstore.com, 2007). Some people may argue that major labels will produce music with a better sound quality because they have more money and therefore more sophisticated equipment, but are the music production tools that expensive and unaffordable for smaller independent companies?
The concentration, integration and conglomeration in the music business industry increasing the control of the major labels have both positive and negative aspects. On the advantages side, as stated earlier, major labels have more money, influence and connection and therefore artists signing with them will benefit from a greater promotion and will also ensure a better distribution to meet the listeners demand whether it is in the stores or on the radio (David P., n.d.). On the other side, major companies focus on what would “sell” and forget about creativity needless to say that they will reward the business team more than the artist himself. Also, the independent labels focusing more on creativity started working on the digital environment and the internet quiet before the major labels did and therefore have more experience in this field which I will talk about later (David P., n.d.). With more focus on music than on business, indie labels are more prone to sign contract with great “music artists” while major labels are more likely to sign contracts with great “profit generators”.
When going quickly over my music collection I realized that most of the songs are related to sex, superficial love stories, drugs and violence. I personally have no problem with those topics and I never feel influenced by songs’ lyrics. I should say that I give more importance to music and melody than to lyrics themselves. However, this seems to be interesting because when I look around me, in the Lebanese society, I realize that the majority of people are being more open-minded about topics like sex that where and still are taboo topics for a lot of Lebanese. In addition to that, I see an increasing number of people entering the world of drugs and I realize that most of the artistic figures they admire are artists known for their drugs addiction. This raises an important question: How important is the influence of music on people and societies?
Wal-Mart used to be the biggest record seller in the US but now iTunes took over by selling tracks online in a digital form (Knopper, 2011). Offering the same products at lower price and being accessible from anywhere with internet availability gave online stores an important competitive advantage over traditional stores: Why would I go to Wal-Mart if I can get my stuff cheaper by staying at home on my computer? And this does not mean that less money is generated: For a typical $1.29 song sold on iTunes, 60 cents goes to the label, 40 cents to Apple (The retailer), 20 cents to the artist and 9 cents to the songwriter (Knopper, 2011). Today, the rise of the digital world increased the number of illegal free music downloads and that is very harmful for artists and for music companies whether they are major labels or Indies: According to Forrester Research, music sales in the US decreased from 14.6 billion in 1999 to 6.3 billion in 2009. Did most of the people stop listening to music or are they just getting tracks for free?
To conclude, four major label companies that have more money and power control and therefore attract more artists control the music business industry. However, this doesn’t mean that music produced by those companies is of greater quality comparing to independent labels. It is also very important to look at how music we listen to everyday affect our person and our society and to realize how online music stores took over the traditional ones in addition to the ever-growing downloads of free music.
Advertisements