Music Production, Publishing & Distribution
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 4,100 companies in the sound recording industry in the US produce and distribute musical recordings, publish music, and provide sound recording and related services. Recorded music companies, also known as record “labels,” generate revenue through the sale of physical products (CDs, vinyl albums) and digital products (downloads, streaming). Distributors generate revenue through wholesale sales of music to online and brick-and-mortar stores. Music publishers generate revenue from royalties received through the exploitation of musical compositions, which include licenses to reproduce and perform music.
Music Piracy
Piracy is one the music industry’s most serious issues and significant source of lost revenue.
Industry Concentration
The musical production, publishing, and distribution industry is highly concentrated and dominated by large multi-national firms.
Industry size & Structure
The average company operates out of a single location, employs about 5-6 workers, and generates over $5 million annually. Employment averages within the industry range from 3 to 17 workers, and average revenue ranges from $640,000 to $15 million annually.
- The music publishing and distribution industry consists of about 4,100 firms that employ about 23,000 workers and generate almost $21.6 billion annually.
- The music publishing and record production/distribution sectors of the industry are concentrated; the top 50 companies account for 93-96% of sector revenue. The sound recording sector of the industry is more fragmented; the top 50 companies account for 38% of sector revenue.
- Record production/distribution companies account for 20% of establishments; music publishers account for 19% of establishments; sound recording studios account for 49% of establishments; and other sound recording firms account for 12% of establishments.
- The largest music publishers and integrated production/distribution firms include Kobalt, Warner Music Group, BMG (Bertelsmann), Universal Music Group (Viviendi), and Sony Music Entertainment (Sony). Major digital music distributors include CD Baby, Ditto, and Octiive. Major recording studios include Capitol Studios, Conway Recording Studios, and Sterling Sound.
- The US accounts for the biggest percentage of music sales globally and is the largest exporter of music, according to IFPI.
Industry Forecast
Music Production, Publishing & Distribution Industry Growth
Recent Developments
Jan 14, 2025 - DIY, Independent Music Distributors Struggle With Industry Changes
- Downtown Music owned CD Baby has laid off staff due to an increasingly challenging environment for DIY and independent music distributors. DistroKid put 37 employees on “administrative leave,” in October 2024. Challenges for the sector include the elimination of payments to the smallest artists by streaming services, more creators failing to gain traction in an oversaturated market, and a $500 million UMG vs TuneCore lawsuit alleging infringement. “In an effort to support the changing needs of artists and the industry, we are consolidating certain CD Baby functions within Downtown and re-allocating resources towards long-term growth opportunities. Unfortunately, this has resulted in the elimination of certain roles and positions at CD Baby,” CD Baby said in a statement to Billboard.
- Independent music is very close to reaching 50% market share worldwide on a distribution basis, according to MIDiA’s State of the Independent Music Economy report. Independent music had 46.7% worldwide market share in late October 2024. Independents held 34.2% of the global market on a distribution basis in 2023 with $14.3 billion in revenues. Non-major shares were particularly high in regions like Asia Pacific, sub-Saharan Africa, and Middle East and North Africa, according to MIDiA. The results show a continuation of an ongoing trend in which, with the open-access of online platforms, independents gain opportunities and major labels lose their gatekeeping power of music distribution, according to MIDiA.
- Gaming platform Roblox announced plans to publish music charts early in 2025, according to company officials. The company also said that it is entering a new partnership with DistroKid, allowing the distributor’s acts to make their music available in the Roblox ecosystem, which consists of millions of games. Roblox chief product officer Manuel Bronstein says the platform wants to help drive music discovery by adding an audio player that can show users what track is playing in the Roblox game that they are playing.
- Music production, publishing, and distribution industry revenue decreased 4.9% year over year but increased 8.1% quarter over quarter during the second quarter of 2024, according to the US Census Bureau. Employment in the music production, publishing, and distribution industry increased significantly while average wages for nonsupervisory employees increased slightly during the first nine months of 2024, according to the US Bureau of Labor Statistics. Personal consumption expenditures, an indicator of demand for music, increased slightly during the first six months of 2024, according to the US Bureau of Economic Analysis. Industry sales are forecast to grow at a 2.78% compounded annual rate from 2024 to 2028, slower than the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc.
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