Current state of the music industry

With the recent split of EMI assets given to both Universal and Sony, the current number of major labels still existing today has gone down to 3 from the previous 6 that existed a decade ago, With Warner trudging along side the former two.This downfall of EMI has increased the share that each major label has of the world market. Universal now controls 36%, Sony 23% and Warner 15%. By moving assets to two of the biggest labels many have argued that this will increase exposure of the artists currently signed, as it will allow for a greater reach into the global market.

Competition has now shifted from major labels v major labels to instead  Majors v Independents. With many bands such as Radio Head also shifting to a do-it-yourself production. Leaving major labels behind. With the drop of CD sales in the last 10-20 years many companies are now shifting to digital mp3 but Internet piracy and the shift from high-profit CDs to low-profit digital singles have forced thousands of label layoffs and drastic artist-roster cuts. The move to digital over physical has caused continuous growing piracy problems, costing the music industry over $12.5billion annually.

Although many mega-stars such as Katy Perry and Lady GaGa are still turning a profit for their labels, it is not ticket sales or music sales that is the cause, It is rather the image of the artist and the products they indorse.

Many have argued that the method of production used by major record labels is out dated. It is not following the times and is finding the shift to a digital market difficult, This has caused a number of independent record labels to set up, bridging the gap between a major label and free distribution. A number of artists such as Nine Inch Nails have already shifted to creating their own label and allowing their music to be downloaded freely. Trent Reznors "Ghost" album was one of the most profitable that year by using a donation scheme.