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Chapter 10: The Recording Industry

by: Deja Jackson

Chapter 10: The Recording Industry Comm 130

Marketplace > University of Pennsylvania > Communication > Comm 130 > Chapter 10 The Recording Industry
Deja Jackson

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Lecture and Class notes
Mass Media and Society
Joseph Turow
Class Notes
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This 6 page Class Notes was uploaded by Deja Jackson on Tuesday April 19, 2016. The Class Notes belongs to Comm 130 at University of Pennsylvania taught by Joseph Turow in Spring 2016. Since its upload, it has received 17 views. For similar materials see Mass Media and Society in Communication at University of Pennsylvania.


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Date Created: 04/19/16
Chapter 10: The Recording Industry 04/04/2016 ▯ History of the Recording Industry ▯ 1877: Edison’s cylinder phonograph; plays “Mary Had a Little Lamb” ▯ 1887: Berliner introduces gramophone; flat disc, very agile, music on 1 side ▯ 1890s: music industry = sheet music, so it was all very simple (Waltz = sexy ;) ▯ Minstrel show’s popular until Vaudeville sakes over in the early 20 century th ▯ 1920s: Commercial radio begins threatening record sales ▯ 1930-40s: Shuffle along  Harlem Renaissance opened door for black performers and writers; DUKE ELLINGTON very popular ▯ ▯ The Modern Recording Industry 1. It’s ownership is international a. Four Majors: Universal Music Group (France), Sony (Japan), Warner Music Group i. Warner is the only US-owned conglomerate ii. EMI Group: UK-based, was a major global company but fell $4 billion in debt iii. 2. It’s production is dispersed a. Independent production firms have soared in the last decade due to newly affordable, powerful digital recording technology i. Many circulate their products to stores, directly on web and concerts because they get to keep more of the money than they would working with large firms ii. Epitaph Records: standout example of how independents are actually quite large operations 3. It’s distribution is concentrated a. Huge successes by independents are rare because of their limited access to distributors b. Major companies are so powerful, that they are the distributors of choice (access to radio stations, cable systems, stores and popular websites) and have a LOT of money to spend c. The Four Majors make up 88% of sales of all physical albums, independents made up the rest ▯ ▯ Features of the Recording Industry Audience  Age is one of the most important demographic to understanding the actual purchasing of music o Recording industry markets mostly to younger people than other age groups o Ages 13-25 account for 24% of spending on recordings in the US, while their population percentage is only around 15% o Purchases of recordings by older people tend to be smaller than their percentages in their population o Nostalgia changes based on demographics ▯ ▯ U.S. Sales: Singles vs. Albums ▯ Single— a product that contains only one or two individual musical recordings  The building blocks of radio formats; the airplay of these songs is normally how the public first learns about an artist  Artists don’t usually make much money off of them in comparison to their album sales  iTunes allows consumers to buy just their favorite tracks instead of the entire album, causing executives to worry that firms will have a hard time maintaining profits ▯ Albums— a collection of a dozen or more individual songs  Digital album sales have been picking up  Digital recording sales grew by 9.2% in one year, offsetting the decrease in physical recording sales  Artists and labels make their money from album sales ▯ ▯ Multiple and Changing Media Platforms ▯ Physical Media— CDs (95%), CD singles, music videos, vinyl records ▯ Digital platforms— vehicle for receiving digital information; a computer, mobile phone and iPad are 3 digital platforms for downloading music  Becoming preferred do to convenience and low cost  All typically involve a form of downloading: transfer of data from a server or host computer to one’s computer or digital device  Ringtones: bits of songs that people download to their mobile phones so that they play when someone calls them; popularity has been declining  Streaming: process in which an audio file is delivered to a computer-like device from a website so that it can be heard while it is coming into the device but cannot be saved or stored; on the rise o Some sites (Rhapsody, Spotify) sell subscriptions for streaming o Internet radio or online radio: pre-chosen music streams based around certain genres provided free to listeners and paid for by commercial ads much like a radio station ▯ ▯ Production in the Recording Industry ▯ Artists and Labels ▯ Label— a division of a recording firm that releases a certain type of music and reflects a certain personality  Ex: Universal has a hip hop label (Def Jam), jazz and blues (Verve), country (MCA Nashville) and classical (Mercury Records)  Similar to an imprint in the book industry  A&R (artist and repertoire): recording firm executives who screen news acts for a firm and determine whether or not to sign those acts; point person in a recording company ▯ Music  Almost all artist record music that someone else wrote  Music publishing companies maintain catalogs of songs and receive royalties if an artists uses a song Royalties: the share of money paid to a songwriter or music composer out of the money that the production firm receives from the sale or exhibition of a work  It is difficult for an owner to keep track of where and how the song is performed  Performance royalties: paid to composers, their publishers, and their record labels when their material is used in front of audiences via stage acts, jukeboxes, radio, television or online radio o Performers or organizations must obtain a “performance rights license” from music societies (ASCAP and BMI  Mechanical royalties: collected as a result of the sale of physical media (e.g. CD’s) and the sale or download of digital recordings, including albums, individual tracks and ringtones o In the US, any artist has a right to record a musical work as long as the creators have already given permission to someone to make a public recording of that work with a mechanical license o Harry Fox Agency— dominant US organization that issues mechanical licenses and collects and disperses them. ▯ Producing a Record ▯ The role of the producer  Compensated on royalty basis  Responsible for obtaining copyright clearances, lining up session musicians, staying on budget and delivering high-quality master tap to the record company  2-4% of sales ▯ Compensating artists  Side musicians often paid by the hour o Very hard because you have to be right on target since studios are paid for by the hour  Central artists receive royalties (10-15% of retail price of album)  New artists make little money from producers  Self-pressing can make more money (shows, concerts, websits); you can reach minimum wage by selling 143 copies/mo. Rather than 3,871 copies/mo. if a CD is sold by a recoring label  *MAJOR CHALLENGE: getting audience to listen even when they cannot hear it in ads ▯ ▯ Distribution in the Recording Industry ▯ Advantages and Disadvantages of Major Labels  Adv: more expensive, you don’t get to keep as much of the share  Dis: brings cross-media exposure  Real distribution power lies in the ability to generate buzz among asrtists’ potential fans that will induce brick-and-mortar and digital retailers to carry his or her records and display them properly  Powerful distributors have the benefit of big promotional teams, liaisons with radio stations and money for cooperative advertising ▯ The Importance of Convergence in Promotion ▯ Promotion: the process of scheduling publicity appearances for a recording artist, with the goal of generating excitement about the artist and thereby sales of his or her album  May include cooperative advertising  Very difficult in the competitive media environment  Non-digital promotion— physical stores have limited samples that consumers can listen to, but radio is the largest influencer though it is slowly diminishing due to the rise of social media  Print promotion, online versions of magazines or music blogs, radio stations’ websites that stream, uploading videos and audio files to YouTube/Facebook fan sites while generating excitement on the local radio  VEVO  Concert tours ▯ The Recording Industry and the Radio Industry  Record-industry promotion executives have a symbiotic relationship with radio program directors  Many radio stations are conservative about adding new music and give preference to existing artists with a good track record and familiarity  Heavy pressures to succeed in radio has led to unethical tactics o Payola: an activity in which promotion personnel pay money to radio personnel to ensure that the latter will devote airtime to artists that the former’s recording companies represent ▯ ▯ Exhibition in the Recording Industry ▯ Digital Downloads  Over 50% of all unit sales, but are less expensive than the albums sold in the physical domain  Apple’s iTunes store— largest venue for digital record purchase  Large amount of revenue comes through subscription services (Rhapsody, Spotify, Apple Music)  Difference between online radio and subscription services— subscription firms allow you to choose individual tracks or albums to hear while online radio allows you a limited selection ▯ Physical Sales  Account for $3.4 billion in sales (dropped from 2007 when it was $8 bil)  Prominent chains (Sam Goody and Tower Records) went out of business  Online retailer Amazon is one of the largest sellers of physical CDs  Sold more often now in mass-merchant stores like Walmart and Target ▯ ▯ Ethical Issues in the Recording Industry ▯ Parental Concerns about Lyrics  Most complaints came about during 1980s when Tipper Gore (Al Gore’s wife) joined with other wives to create the Parents Music Resource Center (PMRC) o Aimed to lobby music industry to place warnings about lyrics on album covers o Wanted explicit albums covers kept under the counter o Demanded a records rating system o Suggested that companies reassess the contracts of those performers who engage in violence and explicit sexual behavior onstage  Walmart has refused to stock albums with controversial lyrics—> caused recording firms to distribute a censored version of the album as well  Rise of gangsta rap in 1980s = more concern about violent or sexually explicit lyrics o Depiction of women in many rap songs o Racial epithets and sexual profanities like the “n-word” and “bitch”  Rappers argue that outsiders should not impose their values on an important field of artistic endeavor and that they reflect views that many African Americans have about their surroundings ▯ Industry Concerns about Piracy ▯ Piracy: the unauthorized duplication of copyrighted material for profit  Counterfeiting: the unauthorized duplication of copyrighted music and packaging for profit, with the goal of making the copy appear authentic o China— the center of counterfeiting o P2P (peer-to-peer) computing: a process in which people hare the resources of their computer with other people’s computers (BitTorrent, Pirate Bay); makes it difficult for copyright owners to blame a website or company for the downloading o Digital locker: an Internet service that allows paying and registered users to store music, videos, games and other files  Bootlegging: the unauthorized recording of a music performance and the subsequent distribution of that recording ▯ ▯


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