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Saturday, May 12, 2007

Reference: http://en.wikipedia.org/wiki/World_music_market

This pie chart shows the US music market shares in 2005, according to Nielsen Sound Scan. From this pie chart, we can see that Universal Music Group has the largest portion, account for 31.71% of the US music market; Sony BMG has the second largest portion, account for 25.61% of the US music market; Warner Music Group accounts for 15% and EMI Group accounts for 9.55%; independent labels account for 18.13% of the US music market.
Universal Music Group, Sony BMG, Warner Music Group and EMI Group make up the “Big Four” record label groups in world music market. Other record label companies which are not owned by any one of the “Big Four” are called independent labels. From the pie chart, we can see very clearly that the “Big Four” dominate the world music market. It accounted for 81.87% of the US music market which is the largest and dominant music market in the world. While other record label companies only account for 18.13%. What a huge difference it is!

Universal Music Group is the largest bussiness group and family of record labels in the recording industry. It owns one of the largest music publishing businesses of the world-the Universal Music Publishing Group, and its record labels have many of the world's biggest artists [1] including Shania Twain, Bon Jovi, Elton John, Method Man, Tupac Shakur, Aaliyah.
Sony BMG Music Entertainment is the result of a 50/50 joint venture between Sony Music Entertainment (part of Sony) and BMG Entertainment (part of Bertelsmann) completed on August 5, 2004. It includes ownership and distribution of recording labels such as Arista Records, Columbia Records, Epic Records, J Records, RCA Victor Records, RCA Records, Legacy Recordings, Sonic Wave America, and others.
The EMI Group is a British music company comprising of the major record company EMI Music which operates several labels, based in Brook Green in London, England, and EMI Music Publishing, based on Charing Cross Road, London.
Warner Music group owns lots of record labels, including Atlantic records, Lava records, Bad Boy records, Roadrunner records and so on. It also has divisions worldwide such as Australia, Japan and all over Europe. These branches are usually called Warner Music followed by the name of the country.
Above is some basic information about the “Big four”. From that, we can see currently how big, powerful these four groups are.

I think these powerful groups have become stronger and stronger in recent years due to the wave of globalization. The strong and powerful wave of globalization helps them expend their businesses and markets all over the world in a very quick speed. Globalization allows them get into other countries’ markets very easily, set up businesses all over the world very easily and buy lots of record labels in different countries very easily. Globalization injects fresh and powerful energies to these countries continuously, making them growing stronger and stronger.
But is this strong effect of globalization on these four big countries beneficial? Obviously, it is very beneficial to these four groups. As they expand further and further, they become more and more powerful in the world’s music market and finally dominate the global music market.
And their expansions help create more and more jobs in different countries, bring more and more money to different countries.
But their trend to dominate the whole world’s music market is very dreadful, not only for independent labels, but also for global customers. Since these four groups become stronger and stronger, they tend to buy as many record label companies as possible. Nowadays, hundreds of record label companies are under their control, only a relatively small numbers of record label companies survive independently in the world’s markets. And these relatively small and independent companies would be easily oppressed by these four big groups. They can only barely survive in the world’s market. From the pie chart, we can find out that they only make up 18.13% of the US music market. As time goes on, as the globalization wave becomes stronger and more powerful, as these four groups become stronger and stronger, more and more independent companies would not be able to survive. They either close their business or become part of any one of these four groups. One day, the global music market would be totally under the control of the “big four”!
Once the world’s music market is controlled by the big four, it is not beneficial for global customers. Global customer would not be able to have many free choices as before. And the prices would be controlled by the big four groups. Customers can’t have a say in the prices determination any more since they only can buy things from these four companies. Prices have to be controlled by these four groups. But very luckily, there are still four big groups. If there is only one group dominating the world’s music market, that would be dreadful.
So I think globalization might bring “big companies domination” to the world’s markets, not only to the world’s music market. The consequence of the domination is what we do not like to contemplate.

Minyun_Economic Expert

Globalised @ 6:14 PM