Music Majors in the Streaming Economy: Universal Music Group

Universal Music Group’s parent company Vivendi announced plans to spin-off the world’s largest music major company as a standalone entity on the stock market. It is no incident that the French media and telecommunication conglomerate Vivendi considers such a strategy. Spotify’s public listing early in April this year was a financial success and it seems that investors currently assess music as a good investment. The overall economic climate is positive and Universal Music Group (UMG) performed very well in the past few years – mainly because of significantly increasing revenues from music streaming. In the last annual report for the financial year 2017, UMG posted a total revenue of € 5.67bn (+ 25 percent compared to 2012) and an EBITA of € 761m (+ 45 percent compared to 2012). Music streaming is the main driver of revenue and profit growth. Thus, revenue from streaming increased by almost 33 percent from 2016 to 2017 to EUR 1.97bn contributing more than a third to UMG’s total revenue in 2017.[1]

The further analysis highlights how UMG had to reinvent itself as a comprehensive music service company with a focus on music streaming and providing a wide range of services far beyond the traditional recorded music business.

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Warner Music Group in the Digital Paradigm Shift

On December 8, Warner Music Group (WMG) released the annual report for the financial year 2016 ending on September 30, 2016 reporting the highest revenue of US$ 3.25bn since Access Industries has acquired WMG in 2011. WMG also reported its best profit performance – measured in operating income before depreciation and amortization (OIBDA) – of US$ 507m since 2006. For the first time after Access Industries’ takeover, WMG will pay a dividend of US$ 54m to its shareholders (WMG 2016: 110). Those key facts indicate a healthy business performance of the smallest music recording major company in the digitalised music industry. Thus, the following analysis highlights the causes for WMG’s economic recovery and the re-structuring of its business model.

Creative Mornings Vienna – Revolutions in the Music Industry

On June 26, 2015, the Creative Mornings Vienna were devoted to the topic “revolution”. I had the honor to talk about the “Revolutions in der Music Industry” at University of Music and Performing Arts Vienna. For those who did not read my book “Creativity and Innovation in the Music Industry” yet, can enjoy a short YouTube video version on the Jazz revolution, Rock ‘n’ Roll revolution and the current digital revolution in der music industry: “Revolution in the Music Industry – Creative Mornings Vienna, June 26, 2015”.

You can find more on the concept of the international breakfast lecturing series here: http://creativemornings.com/

A Brief History of China’s Music Industry – Part 4: The Contemporary Digital Music Industry in China

The music industry of China is an unknown continent from a Western music business research perspective. Therefore it is very meritorious that John Fangjun Li, a lecturer and PhD candidate (2008-2012) at Macquarie University, provides one of the first overviews of the history of China’s music industry for an international readership. In a series of four blog contributions he highlights the development of the recorded music industry in more than 100 years from the final period of Imperial China to the current Peoples Republic of China. He gives an overview of the impact of Western major recorded music companies in the first half of the 20th century and of the emergence of serveral state operated but also privately owned Chinese companies after the Great Cultural Revolution (1966-1976) in Shanghai, Guangzhou, Beijing and other large cities. He also highlights the current digital music business in China that has been dominating the recorded music industry since the the mid 2000s.

In the fourth and final part of the series on China’s music industry, John Fangjun Li highlights the current situation in the recorded music industry in China, which is totally occupied by digital online and mobile music services.

A Brief History of China’s Music Industry – Part 3: The Recorded Music Industry in China From the 1950s to the Early 2000s

The music industry of China is an unknown continent from a Western music business research perspective. Therefore it is very meritorious that John Fangjun Li, a lecturer and PhD candidate (2008-2012) at Macquarie University, provides one of the first overviews of the history of China’s music industry for an international readership. In a series of four blog contributions he highlights the development of the recorded music industry in more than 100 years from the final period of Imperial China to the current Peoples Republic of China. He gives an overview of the impact of Western major recorded music companies in the first half of the 20th century and of the emergence of serveral state operated but also privately owned Chinese companies after the Great Cultural Revolution (1966-1976) in Shanghai, Guangzhou, Beijing and other large cities. He also highlights the current digital music business in China that has been dominating the recorded music industry since the the mid 2000s.

This part on the Chinese music industry by John Fangjun Li covers the second half of the 20th century after the emergence of the Peoples Republic of China in 1949 over the period of the Great Cultural Revolution (1966-1976), China’s Economic Reform and Opening-up Policy until the current digital music industry in China.

A Brief History of China’s Music Industry – Part 2: The Recorded Music Industry in China From the Early 1900s to the Late 1940s

The music industry of China is an unknown continent from a Western music business research perspective. Therefore it is very meritorious that John Fangjun Li, a lecturer and PhD candidate (2008-2012) at Macquarie University, provides one of the first overviews of the history of China’s music industry for an international readership. In a series of four blog contributions he highlights the development of the recorded music industry in more than 100 years from the final period of Imperial China to the current Peoples Republic of China. He gives an overview of the impact of Western major recorded music companies in the first half of the 20th century and of the emergence of serveral state operated but also privately owned Chinese companies after the Great Cultural Revolution (1966-1976) in Shanghai, Guangzhou, Beijing and other large cities. He also highlights the current digital music business in China that has been dominating the recorded music industry since the the mid 2000s.

In part 2, John Fangjun Li highlights the first years of the emerging music industry in China and discusses the role of Western music industry conglomerates until the late 1940s when the Peoples Republic of China was founded.

 

A Brief History of China’s Music Industry – Part 1: Introduction

The music industry of China is an unknown continent from a Western music business research perspective. Therefore it is very meritorious that John Fangjun Li, a lecturer and PhD candidate (2008-2012) at Macquarie University, provides one of the first overviews of the history of China’s music industry for an international readership. In a series of four blog contributions he highlights the development of the recorded music industry in more than 100 years from the final period of Imperial China  to the current Peoples Republic of China. He gives an overview of the impact of Western major recorded music companies in the first half of the 20th century and of the emergence of serveral state operated but also privately owned Chinese companies after the Great Cultural Revolution (1966-1976) in Shanghai, Guangzhou, Beijing and other large cities. He also highlights the current digital music business in China that has been dominating the recorded music industry since the the mid 2000s.

In the introductory chapter, John Fangjun Li defines the research field and outlines his concept of “music industry” in China, in which covergence of technology, politics and cultural expression plays a crucial role.

 

Australian Music Business – An Analysis of the ARIA Charts, 1988-2011 – Part 2

In this blog the early music industry in Australia was analysed in great detail (The Early Record Industry in Australia – part 1, part 2, part 3, part 4, part 5 and part 6). In a four part series on the Australian music business I would like to highlight the recent economic situation of the Australian music industry. In the first part of this series the charts of the Australian Recording Industry Association (ARIA) are analysed to understand the consumers’ taste downunder especially in respect to the Australian national repertoire. In the second part the question is answered, which labels benefit from the chart successes of international and domestic artists. In a third part the development of the recorded music sales in Australia from 2000 to 2011 is analysed to give an explanation for the ups and downs in the observed period. In the fourth and last part of the series the economic role of collecting societies in Australia is highlighted especially from the licensing income’s perspective.

However, in the following the question is answered which labels succeeded in the ARIA charts and the role of indie and major labels a highlighted for the observed period.

The Early Recording Industry in the Czech Lands – Part 2

Guest post by Daniel Matoušek

Until now, there has not been much literature on the recording industry in the former Czechoslovakia.  Particularly the history after the 1950s is not mapped at all yet. However, there are two books about the early music industry in the Czech lands that stand out in scope and in depth of detail: “Fonogram I” and “Fonogram II” by Czech record collector and sound industry historian Gabriel Gössel. The following short series of four articles is thus a look into the history of early gramophone industry in the Czech lands as described in these two volumes.

This second part looks at the period of 1920s, when Czechoslovakia emerged as  an independent state with a flourishing market economy, but became also a victim of the Great Depression at the end of the decade.

The Early Recording Industry in the Czech Lands – Part 1

Guest post by Daniel Matoušek

Until now, there has not been much literature on the recording industry in the former Czechoslovakia.  Particularly the history after the 1950s is not mapped at all yet. However, there are two books about the early music industry in the Czech lands that stand out in scope and in depth of detail: “Fonogram I” and “Fonogram II” by Czech record collector and sound industry historian Gabriel Gössel. The following short series of four articles is thus a look into the history of early gramophone industry in the Czech lands as described in these two volumes.

The first part deals with the very beginnings of a Czech recording industry before World War I, a time span when the Czech lands – Bohemia and Moravia – still belonged to the Austrian-Hungarian Empire.