(Thanks to wiki for the diagram)
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, organized roughly by geographic location. In the industry, it is commonly accepted that the leading 5 major music markets are:
1. USA
2. Japan (Yep, that's why old school rock stars tour there, remember Spinal Tap?)
3. UK
4. Germany
5. France
3. UK
4. Germany
5. France
(Btw aren’t you a bit confused about China’s share being so small? Personally I was. I’ve done some research and it seems that mostly for politic reasons in which I’ll now not go into.)
Now about the Major record companies.
Record labels are often under the control of a corporate umbrella organization called a music group. A music group is typically owned by an international conglomerate holding company, which often has non-music divisions as well.
After years of struggle and consolidation, there are only four major distributors left and they are all owned by Major labels. These are:
1. EMI Group
2. Sony BMG
3. Universal Music Group
4. Warner Music Group
1. EMI Group
2. Sony BMG
3. Universal Music Group
4. Warner Music Group
These are the so called “big four” of the world’s music industry. Each of them owns a bunch of “smaller” labels (though I doubt that you would think twice about signing a contract with any of them. They are considered “small” just because they are not as almighty as these big four monsters are – but some of them have a budget of a small country) for example Universal owns and distributes Island Def Jem, Geffen, EMI owns Virgin, Capitol) and even some Indie labels as you will see below.
These four conglomerates are now ultimately powerful. In 2005-06 the “Big four” accounted for 72% of the world music market sales share and about 82% of the US market.
Here’s the diagram. World music market shares in 2005.
Impressive huh? And after 2005 due to the bankruptcy of many indie labels (and some got owned by majors. Welcome to the jungle punk), digital revolution and other reasons, the share of the majors has grown even more.
To continue, every self-respecting fully staffed label has several branches – Sales, marketing, A&R, promotion, international, production, media & technology and several more. In some companies/labels, each function is up to a single person or a single department, while in some of them several functions are handled by one. In majors and other well developed labels a number of departments take care of each function.
Well, despite that I myself have a passion for knowing all those things; I don’t think that a musician looking up for a record deal needs to know about all of those branches and functions in details. It’s enough to be aware of the A&R system. But I’ll discuss the A&R a bit later; let’s first finish with the labels.
So we’ve come to independent labels.
By the purest definition, an indie label is a label which is not affiliated with a major in any way, uses it’s own resources and methods and distributes its own product in stores. But they are of two different kinds.
Real independents – which are not owned by a major, use independent distributors to distribute their records and stuff.
Major – based Independents - an independent entity that has little or no staff, but signs artists and contracts with a major label (to perform all functions except recording. The main thing they are good at is the ability to find talent and then become a pain in the ass of the distributing company to make sure their product gets promoted. In total, something like a vassal state in the 12th century.
Even the real independents despite their welsh rabbit attitude can be (and often are) financed by major labels, their owners or investors. (It’s kinda sad how everything comes to such a trivial thing as money at last isn’t it?)
We’ll I think it’s enough with the definitions. Let’s move on.
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