You don't need a fancy report to tell you this. Just look at what's happened to the so-called 'indie digital distribution' space for ample evidence of major label domination. The Orchard now features a massive ownership share by Sony Music, INgrooves Fontana is substantially owned by Universal Music Group, and once-indies like IODA and Iris Distribution have been swallowed alive by the machine.
Indie groups like A2IM will scream that they're still in control, they'll blast Soundscan and the majors for shady marketshare counting. But according to a report just issued by the Consumer Federation of America and Public Knowledge, the fact that majors can get away with this creative counting proves they're in a position of power. "We interpret the recent brouhaha over the calculation of market shares as a demonstration that the independent labels have failed to diminish the market power of the dominant firms," the report grates. "We believe this dispute proves the continued importance of the majors, not their imminent demise. While independent labels have grown, they have been unable to escape from the domination of the major labels."
But just how dominant are the majors in this picture?
Methodology please? The groups calculated that indie marketshare is roughly 30 percent regardless of the ultimate distributor. But when indie-only distribution channels are isolated, that marketshare shrivels to just 12 percent.
But who really cares about that? Universal Music Group, that's who, especially as it tries to convince lawmakers to approve its pending acquisition of EMI. Which would explain why the label is suddenly trying to undo its marketshare-grabbing calculations with an "eleventh hour flip-flop," according to the report. Because smaller marketshare means a smaller anti-competitive threat, which means the game suddenly changes. And both Consumer Federation and Public Knowledge, both ardent opponents of this merger, are more than happy to expose that game.
But wait: majors still control a massive amount of music the mainstream wants - across physical and digital. Which means the broader picture looks like this:
Perhaps this is just a prelude to the real problem. After all, massively-funded companies like Spotify aren't paying royalty ransoms and doling out ownership stakes because it's fun. "Alternative distribution models must gain access to the content of the majors to succeed because, as we have already seen, the majors control such a large share of the music that sells across all media and genres."
And more importantly, they can crush the small-but-growing level of independent marketshare by using these tactics. "Major labels can stifle this competition by limiting the number of successful digital distribution platforms, which are the very places where independent labels' offerings can compete with those of the major labels on a level playing field. The major record labels may accomplish this by withholding licenses entirely or by demanding high advances, royalties disproportionate to their market share, or an equity stake in the digital service as a condition of a license.
lifer Friday, June 15, 2012
Same as it ever was. SUPPORT MICRO LABELS!
WILL Monday, June 18, 2012
True. No different to the physical space in the 90's. Lots of the leading indies at the time were distributed through majors both in the UK and US. The costs to distribute nowadays are nothing like they were but the M & A activity around the few digital ditribution heavyweights isn't the fault of the indies.
I think it's beginning to dawn on all the DIY envangelists that the reality is that nothing has really changed beyond how music is consumed. Radio is still the major influencer, the majors have the financial muscle in terms of marketing through the old channels and the fragmented new ones and eluding to another post about whether talent is what it takes, one should respect any song that breaks out because it takes genius and skill on a marketing/promotional level to achieve it. Applaud that, don't bitch and moan that the songs stinks..it's missing the point, especially in a hugely saturated, dog eat dog environment like 2012.
@ericdickinger Friday, June 15, 2012
Ring a bell, film?
@soundcentralsta Friday, June 15, 2012
Is this a surprise?
@prinswill2 Friday, June 15, 2012
i love what am hearing
VC Slave Saturday, June 16, 2012
Gee, that's funny. I would have sworn the inverse were more likely true - major label distribution is now heavily dependent on indie labels.
lifer Saturday, June 16, 2012
@vc slave touche!
paul Saturday, June 16, 2012
ha, great comment.
Central Scrutinizer Saturday, June 16, 2012
Indie labels are just major label wannabes. No matter how much they protest and whine about the system they all end up realizing why the major labels are the way they are and either join the club or flail and fail.
If you are an artist don't fool yourself into thinking indie labels somehow have more integrity or respect for "artists" It's all just product getting sold one way or another.
Sad Reality Sunday, June 17, 2012
Zappa Trust just signed deal w Universal. Too bad they couldn't find the resources to do it themselves thru zappa.com
Indie Saturday, June 16, 2012
Support red eye distro and SEED distribution. Two of the best indie distributors left standing
Poonvillage Saturday, June 16, 2012
What is SEED distribution? Who do they distribute? Where are they located? Thx, my google's busted.
S.B Holmes Tuesday, June 19, 2012
Straying from the norms of commercial music, Seed World Wide delivers a diverse catalog of imminent genres. Seed is a Digital Music Distribution Boutique that single handedly provides nothing but fine music to the masses. Seed is known for their particular and distinguishing roster, which include Labels and Artists such as, Diplo, Danny Brown, Datsik, Flosstradamus, Kitsune, Fools Gold, Scion A/V and many other noteworthy Independent Musicians and Labels. The company is located in Brooklyn, NY, in the Williamsburg Area.
-Support Indie Distribution :)
iVidz.tv Saturday, June 16, 2012
We have a solution in the works. Check out www.ividz.tv we are promoting indie via music videos. Live streaming 24/7
Gizzle Saturday, June 16, 2012
WRONG. INgrooves is not "majority owned by UMG". Do your homework. They are the LAST of the true indies.
SS Jamaica Saturday, June 16, 2012
I don't think it says majority owned anywhere, but it is substantially owned by UMG.
If you think Ingrooves is indie, you're drinking some very spiked kool aid my friend.
Nick Monday, June 18, 2012
Universal now owns 15-20% of INgrooves. Make of that what you will.
@nwmppromo Sunday, June 17, 2012
Fpurnell Sunday, June 17, 2012
This article is a wake up call that things are well with deep pocketed interests. I remember when you could sign up on The Orchard and IODA as artists. Not any more, now you have to submit your stuff like as before. Oh well, welcome back to the good ole days
mico Monday, June 18, 2012
IODA was swallowed by SONY years ago and merged now with the Orchard.
Distribute where, exactly? Monday, June 18, 2012
Where do these distributors even distribute TO? Yard sales? Because that's where I shop for CDs, mostly.
J Red Monday, June 18, 2012
They are DIGITAL distributors. They deliver to iTunes, Amazon, Beatport, etc. Jesus! At least learn about what you are bitching about!
@reputationradio Monday, June 18, 2012
i did say this was gonna happen...
@iammatthughes Monday, June 18, 2012
Support your local indie music labels.
Rent Monday, June 18, 2012
Did the Independent distribution have to sell to the "majors"?? really?
If so, then the so-called independent distribution is thus a sham or I guess they were just looking for a meal ticket, and the "majors" supplied it. But, you have love this type of dis-information by making it look like independent lables just laid down and took it. I would say there's much more to this tripe then meets the eye... The big money saw something of value and they swooped in and took it no surprise there. I just wonder how many folks were threatened and harassed before they got the signatures signed in blood....
Visitor Monday, June 18, 2012
You think CashMoney's CEO Birdman got to be a megamillionaire using a major for distribution? That's funny.
Rap is different, because physical product still moves there, and its is more of a closed circle, but I think the example is pretty obvious. You're better off hiring people to do the work you learn how to delegate, than to sign any masters off to anyone for any reason.
I dont know who negotiates once a song gets into the rarified upper air, but someone tell me how that happens. I'm still surprised how much Birdman is worth, because his early acts weren't that big at all, and even a few of the later ones are not megahuge.
TMG Tuesday, June 19, 2012
The record industry execs fueled the independent online distribution stuff. Gave them the money to do it. Everything goes through the majors. Always have and always will. It's a very powerful industry and the powers that be won't let some internet site steal their thunder, or their money. The majors know that the independents will use these sites to find artists or the "next best thing". It's kinda like the new artist development, since the majors dont develop artists anymore. These sites allow the serious artist to develop their own careers and then they move on when"discovered".
musicservices4less Wednesday, June 20, 2012
Sorry I'm so late to comment but I must. My major client out of Western NY and who will remain nameless :) has been truly independent for over 40 years. Physical goes thru an independent distributor (not an online digital distributor). And is still basically independent in the digital realm by going direct to iTunes (80-90% of digital sales) not thru our digital distributor but who does manage almost all other digital retail sales. So we have 3 distributors domestically. If you only have one or two artists on your "label", I am sorry to inform you but you're not a label you are DIY. Of course you have a label name but that's about it. This is not to say anything negative about the artist it's just reality in the music business. BTW, most of this aspect of the "work" (digital distribution domestic & international) is done by one part time person with alot of experience in this field. So, to completely cover all aspects (including royalty reporting) all you need is a very small team (2 people at most) part time.
kidsplaymusic Thursday, June 21, 2012
i wad wondering about distibution for kids music. what do suggest as im a writer and looking to get my cd noticed.the distribution im with has not done anything. thanks.
Jeff Robinson Wednesday, June 20, 2012
A related topic, but not really so- who wants to wager Apple's iTunes store under-reports sales? And if that's the case, then W. Bush really did win the election in 2000.
@riskycereal Friday, June 22, 2012
So ummm what does independent mean again??
@bandwidthmusic Friday, June 22, 2012
Maybe I have the wrong definition of independent!!