Distribution is the one aspect of the music industry that is going to change faster and more often than anything else. This has as much to do with new technologies as it does with listener tastes.
Traditionally, distribution is how music gets into stores. Distributors have deals with the major record labels and take a cut of each album sold. However, with the rise of digital distribution and a growing interest in indie music, the way that people get their music is changing.
Here’s a quick look at three avenues of distribution:
Major Labels – The Big Four
Thanks to mergers and acquisitions the landscape of the major label music scene can change dramatically overnight. But basically, the major labels consist of “The Big Four”:
- Sony BMG Music Entertainment
- Universal Music Group
- Warner Music Group
Why are they called the big four? In the United States the major labels are respresented by The Recording Industry Association of America (or RIAA). The RIAA claims to create and distribute about 90% of the music sold in the United States. According to Nielsen SoundScan, the big four account for more than 80% of the U.S. music market.
What’s so great about the U.S. music market? The United States is the world’s largest music market with about 35% of the world market value. Japan is second and the United Kingdom a distant third.
You can read more about the major labels and market value on Wikipedia: Music Industry
An independent record label (or indie record label) is a record label operating without the funding of or outside the organizations of the major record labels.
Heather McDonald has written an excellent definition for indie label’s at About.com:
An indie label is a record label that is independently funded and not connected to one of the Big Four major labels. Indie labels range from home based hobby labels to highly profitable, large businesses. In the 1990s, the line between indie labels and major labels began to blur somewhat, and now some large indie labels are actually distributed by the Big Four major labels.
Indie labels often face an uphill battle trying to get their music heard, as they typically have far fewer financial resources to promote their music than major labels do. Despite the struggle, many labels have survived, and thrived, for years, and many other indie labels may not have lasted forever but had a tremendous impact on music both creatively and in terms of business.
You can learn more about indie music and distribution on Heather’s Music Careers site.
Check out our Top 10 Hits of CD Distribution
Digital music distribution involves selling or sharing music in MP3 format. If you are a musician with MP3s of your music, you have two simple options. You can find an MP3 distribution site and have them distribute your music. The advantage of this is that a large site may get millions of visitors every month, increasing your potential audience. Your other option is to create your own website and make your music available there. This method will give you more control and you won’t have to share a cut of your proceeds with a distribution site. However, your music could be hard to find and you will be responsible for promoting your site and getting the word out yourself.
Nowadays, just about anyone with their own music can have it appear in Amazon’s digital downloads or in the iTunes store. A couple of other big players in online digital distribution are CD Baby and MySpace.