Music industry

The Sony Center at Potsdamer Platz in Berlin
Japanese idol music band AKB48 entertain the audience by performing on stage in Paris, France, 2009

The music industry consists of the companies and individuals that earn money by creating new songs and pieces and selling live concerts and shows, audio and video recordings, compositions and sheet music, and the organizations and associations that aid and represent creators. Among the many individuals and organizations that operate in the industry are: the songwriters and composers who create new songs and musical pieces; the singers, musicians, conductors and bandleaders who perform the music; the companies and professionals who create and sell recorded music and/or sheet music (e.g., music publishers, music producers, recording studios, engineers, record labels, retail and online music stores, performance rights organizations); and those that help organize and present live music performances ( sound engineers, booking agents, promoters, music venues, road crew).

The industry also includes a range of professionals who assist singers and musicians with their music careers ( talent managers, artists and repertoire managers, business managers, entertainment lawyers); those who broadcast audio or video music content ( satellite, Internet radio stations, broadcast radio and TV stations); music journalists and music critics; DJs; music educators and teachers; musical instrument manufacturers; as well as many others. In addition to the businesses and artists who work in the music industry to make a profit or income, there are a range of organizations that also play an important role in the music industry, including musician's unions (e.g., American Federation of Musicians), not-for-profit performance-rights organizations (e.g., American Society of Composers, Authors and Publishers) and other associations (e.g., International Alliance for Women in Music, a non-profit organization that advocates for women composers and musicians).

The modern Western music industry emerged between the 1930s and 1950s, when records replaced sheet music as the most important product in the music business. In the commercial world, "the recording industry"–a reference to recording performances of songs and pieces and selling the recordings–began to be used as a loose synonym for "the music industry". In the 2000s, a majority of the music market is controlled by three major corporate labels: the French-owned Universal Music Group, the Japanese-owned Sony Music Entertainment, [1] and the US-owned Warner Music Group. Labels outside of these three major labels are referred to as independent labels (or "indies"). The largest portion of the live music market for concerts and tours is controlled by Live Nation, the largest promoter and music venue owner. Live Nation is a former subsidiary of iHeartMedia Inc, which is the largest owner of radio stations in the United States.

In the first decades of the 2000s, the music industry underwent drastic changes with the advent of widespread digital distribution of music via the Internet (which includes both illegal file sharing of songs and legal music purchases in online music stores). A conspicuous indicator of these changes is total music sales: since 2000, sales of recorded music have dropped off substantially [2] [3] while live music has increased in importance. [4] In 2011, the largest recorded music retailer in the world was now a digital, Internet-based platform operated by a computer company: Apple Inc.'s online iTunes Store. [5]

History

Early history

Printed music in Europe:

Prior to the invention of the printing press, the only way to copy sheet music was by hand, a costly and time-consuming process. Pictured is the hand-written music manuscript for a French Ars subtilior chanson (song) from the late 1300s about love, entitled Belle, bonne, sage, by Baude Cordier. The music notation is unusual in that it is written in a heart shape, with red notes indicating rhythmic alterations.

Music publishing using machine-printed sheet music developed during the Renaissance music era in the mid-15th century. The development of music publication followed the evolution of printing technologies that were first developed for printing regular books. After the mid-15th century, mechanical techniques for printing sheet music were first developed. The earliest example, a set of liturgical chants, dates from about 1465, shortly after the Gutenberg Bible was printed. Prior to this time, music had to be copied out by hand. To copy music notation by hand was a very costly, labor-intensive and time-consuming process, so it was usually undertaken only by monks and priests seeking to preserve sacred music for the church. The few collections of secular (non-religious) music that are extant were commissioned and owned by wealthy aristocrats. Examples include the Squarcialupi Codex of Italian Trecento music and the Chantilly Codex of French Ars subtilior music.

The use of printing enabled sheet music to reproduced much more quickly and at a much lower cost than hand-copying music notation. This helped musical styles to spread to other cities and countries more quickly, and it also enabled music to be spread to more distant areas. Prior to the invention of music printing, a composer's music might only be known in the city she lived in and its surrounding towns, because only wealthy aristocrats would be able to afford to have hand copies made of her music. With music printing, though, a composer's music could be printed and sold at a relatively low cost to purchasers from a wide geographic area. As sheet music of major composer's pieces and songs began to be printed and distributed in a wider area, this enabled composers and listeners to hear new styles and forms of music. A German composer could buy songs written by an Italian or English composer, and an Italian composer could buy pieces written by Dutch composers and learn how they wrote music. This led to more blending of musical styles from different countries and regions.

The pioneer of modern music printing was Ottaviano Petrucci (born in Fossombrone in 1466 – died in 1539 in Venice ), a printer and publisher who was able to secure a twenty-year monopoly on printed music in Venice during the 16th century. Venice was one of the major business and music centers during this period. His Harmonice Musices Odhecaton, a collection of chansons printed in 1501, is commonly misidentified as the first book of sheet music printed from movable type. Actually that distinction belongs to the Roman printer Ulrich Han's Missale Romanum of 1476. Nevertheless, Petrucci's later work was extraordinary for the complexity of his white mensural notation and the smallness of his font. He printed the first book of polyphony (music with two or more independent melodic lines) using movable type. He also published numerous works by the most highly regarded composers of the Renaissance, including Josquin des Prez and Antoine Brumel. He flourished by focusing on Flemish works, rather than Italian, as they were very popular throughout Europe during the Renaissance music era. His printing shop used the triple-impression method, in which a sheet of paper was pressed three times. The first impression was the staff lines, the second the words, and the third the notes. This method produced very clean and readable results, although it was time-consuming and expensive.

Until the 18th century, the processes of formal composition and of the printing of music took place for the most part with the support of patronage from aristocracies and churches. In the mid-to-late 18th century, performers and composers such as Wolfgang Amadeus Mozart began to seek more 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. [6]

An example of mechanically printed sheet music.

In the 19th century, sheet-music publishers dominated the music industry. Prior to the invention of sound recording technologies, the main way for music lovers to hear new symphonies and opera arias (songs) was to buy the sheet music (often arranged for piano or for a small chamber music group) and perform the music in a living room, using friends who were amateur musicians and singers. In the United States, the music industry arose in tandem with the rise of " black face" minstrelsy. Blackface is a form of theatrical makeup used predominantly by non-black performers to represent a black person. The practice gained popularity during the 19th century and contributed to the spread of negative racial stereotypes of African-American people. [7]

In the late part of the century the group of music publishers and songwriters which dominated popular music in the United States became known as Tin Pan Alley. The name originally referred to a specific place: West 28th Street between Fifth and Sixth Avenue in Manhattan, and a plaque (see below) on the sidewalk on 28th Street between Broadway and Sixth commemorates it. The start of Tin Pan Alley is usually dated to about 1885, when a number of music publishers set up shop in the same district of Manhattan. The end of Tin Pan Alley is less clear-cut. Some date it to the start of the Great Depression in the 1930s when the phonograph and radio supplanted sheet music as the driving force of American popular music, while others consider Tin Pan Alley to have continued into the 1950s when earlier styles of American popular music were upstaged by the rise of rock & roll.

Advent of recorded music and radio broadcasting

Frances Densmore recording Blackfoot chief Mountain Chief on a cylinder phonograph in 1916.
A radio broadcasting system from 1906.

At the dawn of the early 20th century, the development of sound recording began to function as a disruptive technology to the commercial interests which published sheet music. During the sheet music era, if a regular person wanted to hear popular new songs, she would buy the sheet music and play it at home on a piano, or learn the song at home while playing the accompaniment part on piano or guitar. Commercially released phonograph records of musical performances, which became available starting in the late 1880s, and later the onset of widespread radio broadcasting, starting in the 1920s, forever changed the way music was heard and listened to. Opera houses, concert halls, and clubs continued to produce music and musicians and singers continued to perform live, but the power of radio allowed bands, ensembles and singers who had previously performed only in one region to become popular on a nationwide and sometimes even a worldwide scale. Moreover, whereas attendance at the top symphony and opera concerts was formerly restricted to high-income people in a pre-radio world, with broadcast radio, a much larger wider range of people, including lower and middle-income people could hear the best orchestras, big bands, popular singers and opera shows.

The "record industry" eventually replaced the sheet music publishers as the music industry's largest force. A multitude of record labels came and went. Some noteworthy labels of the earlier decades include the Columbia Records, Crystalate, Decca Records, Edison Bell, The Gramophone Company, Invicta, Kalliope, Pathé, Victor Talking Machine Company and many others. [8] Many record companies died out as quickly as they had formed, and by the end of the 1980s, the "Big six" — EMI, CBS, BMG, PolyGram, WEA and MCA — dominated the industry. Sony bought CBS Records in 1987 and changed its name to Sony Music in 1991. In mid-1998, PolyGram Music Group merged with MCA Music Entertainment creating what we now know as Universal Music Group. Since then, Sony and BMG merged in 2004, [9] and Universal took over the majority of EMI's recorded music interests in 2012. [10] EMI Music Publishing, also once part of the now defunct British conglomerate, is now co-owned by Sony as a subsidiary of Sony/ATV Music Publishing. [11]

Genre-wise, music entrepreneurs expanded their industry models into areas like folk music, in which composition and performance had continued for centuries on an ad hoc self-supporting basis. Forming an independent record label, or "indie" label, or signing to such a label continues to be a popular choice for up-and-coming musicians, especially in genres like hardcore punk and extreme metal, despite the fact that indies cannot offer the same financial backing of major labels. Some bands prefer to sign with an indie label, because these labels typically give performers more artistic freedom.

Rise of digital and online distribution

The logo for Apple Inc.'s online iTunes store, which sells digital files of songs and musical pieces–along with a range of other content, such as digital files of TV shows and movies.

In the first decade of the 2000s, digitally downloaded and streamed music became more popular than buying physical recordings (e.g. CDs, records and tapes). This gave consumers almost "frictionless" access to a wider variety of music than ever before. At the same time, consumers spent less money on recorded music (both physically and digitally distributed) than they had in the 1990s. [12] Total revenues in the U.S. dropped by half, from a high of $14.6 billion in 1999 to $6.3 billion in 2009, according to Forrester Research. [3] Worldwide revenues for CDs, vinyl, cassettes and digital downloads fell from $36.9 billion in 2000 [13] to $15.9 billion in 2010 [14] according to IFPI. The Economist and The New York Times report that the downward trend is expected to continue for the foreseeable future. [15] [16] This dramatic decline in revenue has caused large-scale layoffs inside the industry, driven retailers (such as Tower Records) out of business and forced record companies, record producers, studios, recording engineers and musicians to seek new business models. [17]

In response to the rise of widespread illegal file sharing of digital music recordings, the record industry took aggressive legal action. In 2001 it succeeded in shutting down the popular music website Napster, and threatened legal action against thousands of individuals who participated in sharing music song sound files. [17] However, this failed to slow the decline in music recording revenue and proved to be a public relations disaster for the music industry. [17] Some academic studies have even suggested that downloads did not cause the decline in sales of recordings. [18] The 2008 British Music Rights survey [19] showed that 80% of people in Britain wanted a legal peer-to-peer (P2P) file-sharing service, however only half of the respondents thought that the music's creators should be paid. The survey was consistent with the results of earlier research conducted in the United States, upon which the Open Music Model was based. [20]

Legal digital downloads became widely available with the debut of the Apple iTunes Store in 2003. The popularity of internet music distribution has increased and by 2012 digital music sales topped physical sales of music. [21] Atlantic Records reports that digital sales have surpassed physical sales. [15] However, as The Economist reports, "paid digital downloads grew rapidly, but did not begin to make up for the loss of revenue from CDs." [16]

After 2010, Internet-based services such as Deezer, Pandora, Spotify, and Apple’s iTunes Radio began to offer subscription-based “ pay to stream” services over the Internet. With streaming services, the user pays a subscription to a company for the right to listen to songs and other media from a library. Whereas with legal digital download services, the purchaser owns a digital copy of the song (which she can keep on her computer or digital media player), with streaming services, the user never downloads the song file or owns the song file. The subscriber can only listen to the song for as long as she continues to pay the streaming subscription. Once the user stops paying the subscription, she cannot listen to the company's songs anymore. Streaming services began to have a serious impact on the industry in 2014.

Spotify, together with the music streaming industry in general, faces some criticism from artists claiming they are not being fairly compensated for their work as downloaded music sales decline and music streaming increases. Unlike physical or download sales, which pay a fixed price per song or album, Spotify pays artists based on their "market share" (the number of streams for their songs as a proportion of total songs streamed on the service). [22] They distribute approximately 70% to rights-holders, who will then pay artists based on their individual agreements. The variable, and some say inadequate, nature of this compensation, [23] has led to criticism. Spotify reports paying on average US$0.006 to US$0.008 per stream. In response, Spotify claims that they are benefiting the music business by migrating "them away from piracy and less monetised platforms and allowing them to generate far greater royalties than before" by encouraging users to use their paid service. [24] [25]

The Recording Industry Association of America (RIAA) revealed through its 2015 earnings report that streaming services were responsible for 34.3 percent of the year's total industry revenue, growing 29 percent from the previous year and becoming the largest source of income, pulling in around $2.4 billion. [26] [27] US streaming revenue grew 57 percent to $1.6 billion in the first half of 2016 and accounted for almost half of industry sales. [28] This is in stark contrast to the $14.6 billion in revenue that was received in 1999 by the music industry from the sale of CDs.

The turmoil in the recorded music industry in the 2000s altered the twentieth-century balance between artists, record companies, promoters, retail music-stores and the consumer. As of 2010, big-box stores such as Wal-Mart and Best Buy sell more records than music-only CD stores, which have ceased to function as a major player in the music industry. Recording artists now rely on live performance and merchandise sales (T-shirts, sweatshirts, etc.) for the majority of their income, which in turn has made them more dependent on music promoters like Live Nation (which dominates tour promotion and owns a large number of music venues). [4] In order to benefit from all of an artist's income streams, record companies increasingly rely on the " 360 deal", a new business-relationship pioneered by Robbie Williams and EMI in 2007. [29] At the other extreme, record companies can offer a simple manufacturing and distribution deal, which gives a higher percentage to the artist, but does not cover the expenses of marketing and promotion.

Companies like Kickstarter help independent musicians produce their albums through fans funding bands they want to listen to. [30] Many newer artists no longer see a record deal as an integral part of their business plan at all. Inexpensive recording hardware and software made it possible to record reasonable quality music on a laptop in a bedroom and distribute it over the Internet to a worldwide audience. [31] This, in turn, caused problems for recording studios, record producers and audio engineers: the Los Angeles Times reports that as many as half of the recording facilities in that city have failed. [32] Changes in the music industry have given consumers access to a wider variety of music than ever before, at a price that gradually approaches zero. [17] However, consumer spending on music-related software and hardware increased dramatically over the last decade, providing a valuable new income-stream for technology companies such as Apple Inc. and Pandora Radio.

Other Languages
Esperanto: Muzikeldonejo
한국어: 음악 산업
Bahasa Indonesia: Industri musik
Kiswahili: Tasnia ya muziki
magyar: Zeneipar
Nederlands: Muziekindustrie
Simple English: Music industry
українська: Музична індустрія
中文: 音樂產業