The music industry has an incredibly elaborated system since it includes multiple stakeholders. Moreover, within the last decade, its structure has undergone significant changes, and this rapid transformation demonstrated how innovations could ruin the existing sector of the industry. The mixture of audio technologies with computing technologies turned music into an information product. Technological innovations have changed the way tune and songs are acquired and consumed today.
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It is widely known that large artists are maintained by the crews of professionals, each responsible for specific affairs but collaborating for achieving common goals. Simultaneously, each music path is unique because business practices differ from state to state. Regardless, the music industry has become increasingly influential in the world due to people desire to listen to music ad artists’ will to be creative. Therefore, it is necessary to investigate how the music industry is structured and how it has altered with new technologies.
Throughout the ages, the music industry has endured many changes starting from the car tape players to the launch of Sony production, while its array remained quite strict. Back in the 20th century, the artists were typically recognized by labels while recording organizations provided infrastructure and could access media. Radio, TV, and sometimes the newspapers were responsible for promotion, which ensured artists’ increased revenue growth and worldwide fame. Nevertheless, by the end of the century, the entire system was impacted by the MP3 protocol, which introduced the reduction of music files and initiated their distribution on the internet. The internet allowed artists express themselves in a way unknown before.
The emergence of iTunes and other music services contributed to the spread of tracks. However, it also influenced the illegal distribution and download of hits. Since the beginning of the new millennium, the industry has matured and adapted to the intertwining of the digital and physical worlds and the direct interaction of artists and fans: artists now broadcast live shows on their social media and announce albums with a single post. Meanwhile, ten years ago, a whole marketing campaign was needed to announce the new single.
Marketing strategies that have traditionally been carried out by labels have become everyone’s game. Different publishers, managers, and promoters have contributed to promotion channels, making the industry full of digital creators and providing development to the online environment. There are more ways to promote music than ever, but at the same time, there is more of the music itself. For instance, these days the majority of famous artists use such platforms as Instagram or TikTok to promote themselves and, surprisingly, their popularity is rapidly growing.
There is an entire network of professionals who collaborate in order to create, promote, and distribute artists’ songs. On the whole, it can be divided into several sub-industries, each responsible for a single aspect. They are all united by a common goal – promote the artist, attract fans, and increase revenue. Therefore, only working together on promoting the artist or band, each department may receive decent income and expand their influence in the music industry.
Primarily, the grandest part is the recording industry, which started from CDs and now exists in the form of digital streaming. Record companies were created to promote artists’ creativity and their talents. Meanwhile, they are concerned with providing financial and organizational help to ensure the recording, production, distribution, and promotion of the singer is profitable. They aim to sign a contract with a band or an artist and deal with their material production and manufacturing.
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Signing a new artist is a significant risk for the record company. Normally enormous sums of money are invested to support the recording, filming, and marketing strategies that accompany the new artist’s launch. As a result, the recording companies do the major work since they not only do they help artists create songs but cooperate with other departments to promote them. Typically, it is the label that earns receives of the income. Record labels had troubles with piracy since the beginning of the new century and are still facing issues. Nowadays, numerous independent internet platforms suggest artists an excellent opportunity to build their career without music labels.
Secondly, publishing companies play a vital role in the music industry because they license these copyrights to the labels that record them. A music publisher’s goal is to collect royalties on artist rights related to a real piece of music and they do not record it. In addition, royalty payments go through performance rights organizations, mechanical collection organizations, sub-publishers, and publishers before actually reaching authors and composers. Going through all these stages, the process may take up to several years. In addition, there are statutory shares of a writer/publisher, legal regulations that differ from country to country, fragmented rights to the music, and a million other nuances and subtleties.
Everybody knows of world tours and live performances, and they constitute a large part of the music industry. To start with, agents and promoters must find a singer or a band approximately nine or ten months before the performance. For a band or aspiring artist to order live performances, it is advisable to contact the promoter. Meanwhile, the promotion team has to create advertising strategies to attract the audience.
The promoter will have prior knowledge of sites and contacts in the area, and in most cases, will have exclusive access to specific locations. Their primary duties are to organize live performances by booking seats, hotels, and restaurants, advertise shows with flyers and posters, and press in magazines, Newspapers, and in some cases on television and radio. In addition, the promoter is responsible for paying for the rental of the venue and musicians and their own share. This usually occurs in the form of a “door split” from ticket sales. For larger-scale concerts and band tours, the band or artist will use a booking agent.
Booking agents’ primary role is to represent the artist and make concert plans with promoters. Unlike a promoter, a booking agency signs a contract with an artist and works with them to make sure they play at the right locations and venues. They will then book the artist for live shows, tours, and festivals and work with the promoter to ensure the event runs smoothly. The booking agency charges the promoter an advance payment for their services and then is responsible for ensuring that the event is successful. The booking agent usually pays an advance to the artists’ managers to go on tour.
The business side is typically structure by managers who are responsible for each facet. Managers have a unique relationship with artists, as they are the only partners who are always connected to artists financially. Instead of concentrating on one industry, managers prefer to work on long-term global strategies in order to assist artists in making vital business decisions. They are the mediators in the industry since they deal with all aspects – from record companies to hotels – and negotiate the artist’s best bargains. Basically, the band or artist’s manager organizes everything for them to pursue a career as an artist so that they can focus on making music. A contract will be drawn up between the artist and the manager, which will detail both parties’ obligations, the duration of the agreement, and the amount that the manager will pay.
The manager can delegate tour tasks to the tour manager for larger artists, who organizes and manages the tour. In order to complete this, the tour manager must be increasingly organized and able to cooperate with large groups of people. Once the promoters have put everything in place, the tour manager’s duty is to make sure that the schedule is followed and the show is running correctly. In addition to the artists, the tour manager will be responsible for the road crew, sound engineers, lighting technicians, and bus drivers and communicating with the venue staff and any press meetings or interviews. If there is some work to be done on tour, the tour manager will usually be the first and last contact point. In addition to all this, they will ensure that the revenue from performances is collected and the bills related to tours are paid.
The distribution organizations are mediators between the retail companies and the labels. Their main objective is to deliver releases to the retailers and keep the revenue flow back to the artists and record organizations. To ensure the income is growing, the distribution team must collaborate with the marketing. The former will seek to expose the artist at any event, interview, radio stations, or advertising campaign. As a result, their cooperation will expand artists’ popularity and increase the income.
The promotion sector is another crucial aspect of the industry since each artist must be advertised before becoming famous. A music promoter’s main job, usually referred to only as a promoter, is announcing a concert or other events. Promoters are the people in charge of staging artists’ performances. They work with agents, managers, or directly with bands, clubs, and concert sites to organize shows. The promoters are responsible for making sure that this show is known to everyone. They are also concerned with handling unexpected expenditures, such as hotels , restaurants, and other facilities for the artist. In general, they work to make sure that everything operates according to the plan and fix things that go wrong.
In conclusion, it seems crucial to mention how the technologies have impacted the entire music industry. Artists and bands seem to be more independent now and the record labels lose their popularity since online platforms offer singers more prosperous opportunities. Modern internet platforms allow users to promote themselves better that a label can; therefore, the new technologies positively affect artists’ activity. Nonetheless, the music industry structure is becoming more elaborated these days since artists need to deal with multiple aspect including finances, promotion, distribution, and others. Therefore, music industry consists of miscellaneous departments, each in charge of a specific activity.