Music industry

WHO ARE THE BIG 3?

There are 3 major music groups, known as the big 3, which are dominating in the industry currently, Sony Music Entertainment, Universal Music Group and Warner Music Group

Before 2012, there were 4 major music groups, which included Electronic and Music Industries (EMI).  In 2012 & 2013, the major divisions of EMI were sold off separately.  Most of EMI's recorded music division was absorbed into UMG.  EMI Music Publishing was absorbed into Sony/ATV Music Publishing.  EMI's Parlophone and Virgin Classics labels were absorbed into Warner Music Group.

In 2019, Universal Music Group had the US and Canada market share of 54.5%, Sony Music Entertainment had 23.4% and Warner Music Group had 12.1%. 

HOW MUCH DO THEY EARN A DAY?

In 2019, the big 3 music groups made $19m a day from streaming.  In 2018, the big 3 music groups earned a combined total of $6.93b from streaming services, which was $1.6b more than what they earned the year before.  This was the first significant resurgence in the music industry in two decades.

As the influence of streaming platforms like Spotify and Apple Music continues to grow, the domination of physical music sales has been erased in tandem. All three major record companies saw multimillion-dollar declines in sales of physical formats like CDs and cassettes in 2018 — with Sony, which has a suite of artists like Adele who outperform in physical sales, losing as much as a quarter-billion dollars in that category. Vinyl sales continued to be an outlier in the streaming-is-quashing-physical-records narrative, but their numbers were too small to offset the broader physical losses.

WHAT ABOUT THE REST OF THE MUSIC INDUSTRY?

Indie labels are the more minor music groups in the industry.  Although they are often discarded, the indie labels have a combined larger market share than Universal. 

The indie labels have a combined larger market share as Universal. We don’t have full 2018 numbers yet, but in 2016, the indies had a market share 1.6% higher than Universal. In 2017, that had shrunk to .1%. Still, the independent labels, as a group, are powerful. We tend to forget about them when talking about the Big 3.

Although less common, artists can still become big through being independent or signing to an indie label.  Billie Eilish self-distributed their first song together, Ocean Eyes on the famous streaming platform SoundCloud.  This became a massive hit, and Billie has since signed to one of the big three conglomerates, Universal Music Group's subsidiary, Interscope Records.  Arctic Monkeys had a similar start to their career, with using the internet as their distributor, which helped them gain recognition without the help of a label.

BBFC

The BBFC is an independent, private, not-for-profit company which classifies films, video on all physical formats (DVD and Blu-ray Disc for example) and certain video games, advertisements and trailers.  Since 2015, it also classifies, on a best practice voluntary basis, video content for distribution online, like music videos on YouTube and VEVO.  The Big 3 and other UK independent labels have signed up for the BBFC classifications, however only the music videos produced in the UK will be classified, so international artists won't come under the same agreement.  In 2015, out of the 132 videos submitted to the BBFC, 56 were rated 12 and 53 were classified 15. They are under no obligation to submit them to be rated.

With convergence and digitisation making everything accessible with the touch of a few buttons, these ratings are easy to get by, like most things on the internet, but the BBFC aren't trying to hide these videos from children, but make the rating known for parent's, so they can decide whether they will let their child view it. 

BBFC classifications

TAYLOR SWIFT’S 1989 (TAYLOR’S VERSION) ATTRACTED 1,329% MORE STREAMS THAN THE ORIGINAL VERSION OF 1989 IN THE US LAST WEEK

Taylor Swift has recently released 1989 Taylor's Version, freeing her from the shackles of Scooter Braun. The undeniable success of the album anchored her as the biggest artist in the world today. 

'In terms of ‘proper’ sales (i.e. people buying it physically or via download), 1989 (Taylor’s Version) shifted 1.359 million copies in the US in the chart week – helped by the fact it was released on no less than 15 separate collectible physical formats, including five coloured vinyl SKUs, plus two cassette editions'

This tells us that physical media is still in big demand. While it is a big risk even for big artists to invest in making digipacks or vinyl, if the artists have enough recognition and devoted fans, it will pay off in revenue. 

The music industry’s over-reliance on TikTok shows how lazy it has become

Earlier this month, the music industry was hit with its biggest shake-up in years when Universal Music Group announced that it would be pulling the entirety of its catalogue – which covers everyone from K-pop stars BTS to Taylor Swift and legacy acts such as Abba – from TikTok.

TikTok is one of the leading social media platforms and a crucial part of the promotional campaign of an album/music video release. Big conglomerates used all the user-generated content to their advantage, with the expectation placed on artists to post on such platforms. The takedown of music from the app is greatly jeopardizing the artists directly.