Major Record label Research Project Audiences and Institutions Sony Music Entertainment Ownership When researching the ownership of Sony Music Entertainment I discovered that there have been (and still are) many affiliates within the company. Sony Music was founded in 1929 as the American Record Corporation, through the merger of several smaller record companies. In March 1968, Columbia Broadcasting System and Sony formed CBS/Sony Records, a Japanese business joint venture. On November 17, 1987, the Sony Corporation of America acquired CBS Records, which hosted such acts as Michael Jackson, for US $2 billion. CBS Inc., now CBS Corporation, retained the rights to the CBS name for music recordings but granted Sony a temporary license to use the CBS name. CBS Corporation founded a new CBS Records in 2006. Today Sony Music Entertainment is 100% owned by Sony Corporation of America. However there are many subsidiary labels within Sony Music Entertainment such as; • RCA • Columbia These labels were organised as being UK frontline music companies in 2006. Within these companies are many other different labels, among them are; Jive, Epic, Zomba, J Records, 1965 Recordings, Syco Entertainment and Phonogenic.
Sony music Entertainment RCA
Columbia Artists
Jive label group
Artists Epic
Apocalyptica
ABBA
Britney Spears
Blondie
Chris Brown
Cam'ron
Daisy Dares You
Duran Duran
Justin Timberlake
Europe
These are a few examples of many artists signed within the companies.
Another label partnered up with Sony Music Entertainment is Syco. Syco is a London based entertainment company established in 2002 by A&R executive, television producer and talent show judge Simon Cowell. Syco is divided into three sections: Syco Music, Syco TV and Syco Film. Cowell claims Syco accounted for 40% of all Sony Music UK profit in 2006 despite only employing 15 people. By 2008, it was reported that Syco accounted for 70% of profit at Sony Music UK. Simon Cowell recently made a deal to renew the contract into a split partnership with Sony, the new venture will allow Sony Music and all Sony divisions to develop and pursue a host of new opportunities with Simon and Syco as a whole. Syco is also the record label home for such diverse international recording stars as Leona Lewis and Il Divo. Cowell has worked with artists selling more than 180 million albums and delivered more than 150 No.1 records. In 2009, Cowell was named No. 1 in Hollywood Reporter's Top 50 Most Powerful in Reality TV and one of Entertainment Weekly's Top Entertainers of the Year. In addition to The X Factor, Syco is also the owner of the Got Talent TV format which currently airs in 27 countries and is the UK's most successful TV format export. In 2009, 'Britain's Got Talent' launched the global music career of Susan Boyle, whose debut album, I Dreamed A Dream, sold over 8 million albums in six weeks, making it the world's biggest selling album of 2009 and the fastest selling album in history. More info here -
http://www.sonymusic.co.uk/company_news/15884/
Distribution and Marketing strategies • How does your label distribute to fans? • Physical (CDs in HMV)
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Online (Hybrid retailers like Amazon) Pure digital retailers like ITunes Live streaming (Last FM, also featuring new unknown bands to create variation within the market)
Sony As part of the partnership, Sony Music has made a strategic investment in IODA, a leader in digital distribution, marketing, and technology solutions for the independent music industry About IODA IODA, the Independent Online Distribution Alliance, is the industry-leading digital distribution company for the global independent music community. IODA provides comprehensive services to record labels, physical distributors, and artists, including license negotiations; media encoding and metadata management; and royalty payment administration and reporting. The company also offers promotional support through a dedicated marketing division and through IODA Promonet. A promotional distribution network, IODA Promonet provides qualified podcasts, blogs, and other music sites with access to pre-cleared, legal music and other promotional assets from IODA’s labels. Founded in 2003, IODA represents a rapidly expanding roster of nearly two million tracks that is licensed to more than 400 digital storefronts worldwide. IODA also distributes independent film and video content for over 2000 titles. IODA’s retail partner network includes all major digital music services like iTunes®, Amazon MP3 and MySpace Music and mobile carriers and outlets such as Verizon Wireless, Sprint and Nokia. • Retail partners with ITunes, Amazon, and Myspace. • Distributes more to the niche market • A digital distributor- IODA Promonet only distributes to digital markets • Sony and IODA partnered up in 1st July 2009
RED With its independent distribution subsidiary RED, Sony Music currently provides sales and marketing services to independent labels and artists. IODA now brings its proven digital distribution platform for the independent sector into the Sony Music network. RED and IODA will build on their technologies and increase the scope of sales and promotional opportunities that each currently offers its existing and growing customer base worldwide. Both companies will also leverage the global marketing and financial strength of Sony Music to continue expanding their businesses. (IODA promotes artists within RED’S label through the digital market as this is an independent label and it is catering to a niche market) •
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A division of Sony Music Entertainment RED handles sales and marketing for 47 independent record labels, as well as repertoire from parent company Sony Music Entertainment.
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RED's marketing outreach, including online lifestyle network www.GEN79.com, is unsurpassed in generating fan excitement an building awareness for artists and marketing partners
Consumption/Exchange • How do we access music? • Do we buy it? • Live stream it? • Is it fair to expect to get music for free? How can the labels make money? Should the government be tougher on internet service providers? As being a part of a young audience I can personally say that there is a huge demand for music to be available as fast and cheap as possible. As technology has developed, so has the demand for new and unique artists. Devices such as IPods, Mp3’s and mobile phones have created a digital development but this has resulted in file sharing and illegal downloads as it is just not possible for students to afford the amount of music they wish to listen to. There are many ways in which people can access music. Particularly for the younger audience it is via the internet, through websites such as; YouTube and Grooveshark for example, which is a free online playlist. Many people also use these methods of consumption; • Illegal downloads • Legal downloads via ITunes • Retailers such as HMV and Amazon • File sharing/ CD rips There has been an ongoing concern about the purchase of music for artists and record labels affiliated with them. The problem has seen a rising amount of illegal downloads across the world and this has been very disastrous for people within the industry as copyright regulations are so easily broken. With regards to money however, the IFPI’s digital music report 2010 has revealed that digital now accounts for 27% of label income. Overall digital sales have grown 940% since 2004. Poker face by Lady GaGa was the most downloaded track of the year with sales of 9.8m units. The alternatives for record companies to popularize their audience purchasing music are through these methods; • M-flow (a website which encourages the audience to purchase the music after they have previewed the track. It also encompasses social networking within the site as once you have purchased a track you can forward it to your followers. They can listen once. If they purchase you get 20% of the purchase price as a credit towards buying more music.) • Spotify (Spotify is a proprietary peer-to-peer music streaming service and application software from a Swedish company. It allows instant listening to specific tracks or albums, with virtually no buffering delay. Music can be browsed by artist, by album, by record label or by created playlists as well as by direct searches. A link allows the listener to purchase selected material via partner retailers. Spotify make their money in three ways; Advertisement, online subscriptions without these ads for £5 p/m and also downloads as people would like to own the track. One criticism about the website is that it doesn’t allow users to save the music on their pc. However, this is how Spotify
encourage the audience into purchasing the music, whilst also having the freedom to stream online music if they do not wish to buy) Should we pay for music? It may be said that this is the one thing that everyone has considered and not been made to feel guilty about for stealing. Many people are very ignorant to the feelings of artists and record labels and may not even know how they produce their money which can avert consumers into buying their product. The methods that record labels are now going ahead with, will eventually turn the view of many people but for the moment the industry is continuing to make money, prominently through digital means.
Long tail Amazon results show that; Britney Spears (signed to jive label group) is 2,000 on the best sellers list Chris Brown (signed to jive label group) is 672 on the best sellers list Blondie (signed to epic) is 595 on the best sellers list Cam’ron (signed to epic) is 37,349 on the best sellers list The Long Tail refers to the statistical property that a larger share of population rests within the tail of a probability distribution than observed under a 'normal' or Gaussian distribution. This has gained popularity in recent times as a retailing concept describing the niche strategy of selling a large number of unique items in relatively small quantities – usually in addition to selling fewer popular items in large quantities.
This is an example of a long tail. A long tail basically shows the most popular artists within the website. This then causes less popular artists albums to be sold.