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Who Owns the Music Industry?

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Estimated reading time: 7 minutes

The music industry is an umbrella term used to describe the creators, manufacturers, distributors, retailers, and adjacent organizations who create and sell music as both goods (recordings, sheet music) and services (live concerts). From the sheet music publishers of Tin Pan Alley at the turn of the 20th century to the three multinational corporations who dominate record production today, there have always been big fish in the music industry pond.

However, there’s always been room for the little fish too — the independent artists and record labels. Some of the little fish become big fish — Chess, Sun, Motown, Sub Pop, Stax, and Elektra, to name but a few record labels. So, who owns the music industry these days? While it’s something of a trick question as no one entity has ever “owned” the entire music industry, I’m using this question to explore what’s going on and how it relates to indie artists and organizations out there making music right now.

The evolving landscape of the music industry

The music industry has generally been a function of the medium it sells. First it was sheet music, then 78, 45, and 33 rpm vinyl records, then cassettes, CDs, digital downloads, and finally, streaming. Through these technological changes, different companies have maintained control over the creation and distribution of music products. Today, more than ever, the ability to produce music and release it online is available to anyone with a phone or computer.

As a musician living in the 2020s, it’s important to be aware of what is going on in the music industry at large. How you will respond to the current climate is up to you, but a lack of awareness can only lead to misguided decisions. For example, your music might be perfect for a ’70s-style van with shag carpeting but releasing it on 8-track is probably a bad idea (not to mention impossible). Instead, target ’70s-themed streaming playlists on the streaming services and make sure your album cover art and CD booklet reflect your nostalgic vibe.

Major players in the music industry

From one perspective, if you really want to know who owns the music industry, you could argue it’s the big three: Universal Music Group, Sony Music Entertainment, and Warner Music Group. I don’t mean that literally, but together they do comprise 68 percent of the recording market share and their publishing wings own 58 percent of the music publishing market. Signing with a record label with a network in the music business worldwide can be a dream for a recording artist.

However, these companies are also owned by reactionaries who don’t anticipate the future as much as try to preserve their market share and keep things frozen to what they want to sell in the present. So, while the Big Three own the majority of the music industry, they are not driving the bus for future innovation and their new artist signings these days are limited to those who make modern pop music and already have a proven audience on social media.

The next largest organizations in the music industry are the streaming services, the top three being Spotify, Apple Music, and YouTube Music. These tech companies and retailers have no previous history of being involved in the music business and their business practices reflects that. The rest of the music industry is comprised of smaller record labels and independent artists. While the market share and “slice of the pie” aren’t as great, the small fish at the bottom of the pyramid are the ones who drive innovation and artistic progression.

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Challenges and opportunities for musicians

One of the worst parts of new music industry is that the Big Three have almost zero commitment to breaking and developing new artists. The days of Tom Petty, demo in hand, walking door to door to the major labels in LA and getting signed are long over and have been for a while; try that now and not only will they not accept your demo (for legal reasons), but you won’t even get past security. The ability to make a quantum leap in your career was never easy, but now it is nigh impossible. The collapse of terrestrial radio as a force for promoting new music adds another set of hurdles for artists to reach listeners.

So, who owns the music industry? You do! The good news is that in the 2020s, the tools of production are available to any and all independent musicians. Maintaining the rights to your masters and intellectual property — and collecting publishing and music royalties — is possible in today’s music business.

You can record your own music in accordance with your own vision and release it yourself to a potentially worldwide audience online; you can also make it available on streaming services with the potential to sit in a playlist next to any major label artist, past and present. While we all know how difficult it is to make money, build a following, and break through the algorithms to reach people in this paradigm, the fact that the paradigm exists at all is indeed an opportunity.

The impact of streaming services

Another answer to the question of who owns the music industry? The streaming services, of course! Streaming is now the number one way most people listen to music. For those of us who marveled, in 2001, that we were able to carry our entire record collection in our pocket, the new reality is that practically every record released is available, any time, anywhere you are.

29 Tips guideBut streaming is, at best, a mixed blessing; the companies who have come to control the bulk of the streaming apps don’t even see themselves as being in “the music industry,” a problematic and erroneous conclusion that leads to them devaluing the very music they make money from.

Studies have shown that streaming services do lead to people listening to more music in general, more new music specifically, and a wider variety of artists. Listeners have more control over how they listen to the music; they can arrange albums in a different order, add their favorite songs to playlists, and generally tailor the listening experience to their liking. However, the obscenely low royalty rates for streaming mean that even artists with immense reach and millions of streams don’t make anything close to a living wage from having their music streamed. If streaming is to become a viable listening option in the future, it will have to support the artists without whom it would not exist.

The role of physical media

While streaming may satisfy the listener’s need for quantity, when it comes to sound quality, there is still nothing like the old school physical media of CDs and vinyl. There are legitimate high-resolution streaming services (Qobuz being the primary one), but streaming has not yet achieved audiophile quality in most people’s estimation.

And, as current trends show, there is a continuing increase in sales for physical media — both CDs and vinyl LPs — driven by sound quality and the sheer pleasure fans derive from owning and interacting with a physical product and all the tactile and graphic features it includes.

For an independent artist, the profit margins on physical media are very high. You don’t have to sell many to make the money back that you’ve invested into the manufacturing, so you can make a tidy profit if you sell a reasonable number of units.

And don’t overlook the promotional and interactive opportunities physical media provides. CDs and vinyl are tangible items you can sell at your live performances; they’re something you can sign and something the audience can take home with them as a souvenir of the show. So, while independent artists aren’t necessarily the ones who own the music industry, you can own and operate your little corner shop in the larger music world.

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Chris Huff

About Chris Huff

Chris Huff has been a professional singer, multi-instrumentalist, songwriter, and producer for over 25 years. He has worked as a sideman with Peter Yarrow (Peter, Paul, and Mary), Echo and the Bunnymen, Chuck Hammer (David Bowie, Lou Reed), and Tom Kitt (Broadway composer of Next To Normal). Chris also wrote liner notes for David Bowie’s Live And Well CD, and his full-length album, 'bout Time is available on iTunes.

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