A record label is a company recording the music and offering much more services connected with it like management for musicians, arrangement of the production, marketing and distribution of sound recordings and video, which it also makes. It can search for talents and develop new artists. Why is it called a record label instead of a studio for example? The answer is simple. Thanks to that circle in the center of the vinyl a recording company gets its generally accepted name.
Functions of Record Labels in Detail
So, a record label makes money on providing public awareness of musician or band or rather brand and name. Most significant ones have their own distribution networks that is why they conclude the agreements with their artists setting usually mutually beneficial terms and conditions and get a significant share of their incomes. There is a lot of work to do with promoting, signing, publicizing and selling the ready product.
Thousands of specialists with a lasting experience in the particular area are involved in this business including the administration, which coordinates the processes and runs the studio. Here there are financial specialists taking care of bookkeeping and all payments including payrolls. The contractual issues are arranged by a legal department. The record label deals with artist development. There are people who are engaged with the search of talents, creation of new compositions. The other ones execute the product design tasks creating images, vinyl and disk covers, advertisement, and art material for print or online media. Marketing managers are responsible for promotions and the fact of publicity, while publicity managers write the content for interview, reviews in print and online media. And of course there is a sales department overseeing the retail activities. All together they form one entity that achieves the significant results in music industry.
The Big 3
Until recently the global music market or rather 90% of that market was represented by 5 record labels. The rest 10% are taken by the small and not high powered ones. Those giants were EMI records, Sony, Vivendi Universal, AOL Time Warner and BMG. They had all needed to create music and musicians of high quality. They impacted on audience choice and preferences defining the standards of every musician genres. Nowadays the balance has changed due to two merges resulting in reduced number of the major players in this global market.
Here we want to represent the existing Big 3 record labels. Three of them take in hand 80 % of all recording activities in the world. The powerful corporations provide the singers and artists with the unbounded resources and recognition of their name. Moreover, they offer a wide range of opportunities for the specialists in music industry creating the perfect employment conditions at any level of the career.
- Sony BMG Music Entertainment, Inc. It got 25 % share of music market after the merger of Sony and BMG in 2004. There are 36 offices in different countries in the world employing several thousand specialists of various types. It owns 11 labels among which we can highlight Columbia, Epic, RCA and others. It represents the biggest celebrities like Celine Dion, Justin Timberlake, Jessice Simpson, Britney Spears and others. In 2016 it gets 8,105,712 mln of operating revenue. And all that money is earned by about 7900 employees of the company.
- Universal Music Group has been owned by Vivendi SA since 2006 and has several headquarters in USA and some offices abroad. It can boast of over 100 other labels in full or partial property. Among them there are Interscope, Motown, So So Def and others. It usually deals with electrical mix of genres and represents such artists as Gwen Stefani, U2, Marian Carey. It purchases EMI in 2012. In 2016 it gets $5.57 billion of overall revenue and employs about more than 5 000 people offering new job positions continuously.
- Warner Music Group founded in 1934 is headed by Edgar Bronman now and has headquarters in New York. There are a lot of offices in other cities and countries like a Latin music office in Miami. Its divisions are found in Australia, Japan, UK, Canada, Brazil, China, throughout of Europe and in other places. In the past it was a branch of well-known movie studio Warner from 1958 to 1987. Now it operates as an independent label and owns a lot of music labels like Atlantic Records, East West Records, Reprise Records. Its staff makes about 4 445 persons all over the world. In 2016 it gets about $2 billion of overall revenue.
Nowadays the above three monsters create, serve and promote the most popular and talented singers and bands making their products available for the public in large. Being open for innovations, knowing the music they become that powerful force taking part in changing our world for good, inspiring people to forward towards their dreams and find the pot of gold at the end of the rainbow.