San Jose, California (PRWEB) February 25, 2008
World Music Recording market is forecast to post a modest CAGR of 0.94% over the 2000-2010 analysis period and reach in excess of US$40.8 billion by 2010. The US, with a share estimated at 36.92% in 2006, forms the largest Music Recording market worldwide, while Asia-Pacific, with a CAGR of 1.93% over the aforementioned period, is expected to emerge as the fastest growing region.
Traditional manufacturers of recording media are shifting over from magnetic media to optical discs, while many other record companies are shifting towards the online platform. Companies are also shifting their production facilities to regions with low manufacturing costs. Another interesting feature of this industry is the presence of high levels of consolidation, allowing only four companies to dominate the world market. These companies, through their regional setups, operate across all major regions of the world and have also emerged as leading players in those regions. Major companies are now repositioning themselves in the market to make the best of online 'revolution'. Other than record labels, other companies such as optical disc and digital tape manufacturers, are also witnessing growth, with demand for discs and tape increasing from not only music, but also from other quarters such as the IT industry. Of the Big Four and various other music companies that also own CD production facilities, some of them are vertically integrated.
Technology has been a dominant force in the music recording industry. The recording industry witnessed a metamorphosis since early phonographs to the current stage of portable digital players. The industry witnessed a sea of change in the last two decades. Invention of the compact disc in the 1980s pushed the music industry into a 'digital' overdrive. Digital technology brought forth newer opportunities to the growing industry, with other allied industries such as motion pictures and video games also making use of the technology. Along with digitalization of music came proprietary formats such as Dolby® Digital, THX®, etc. Technology now is being used to offer the ultimate experience to the end user, what with music CDs/DVDs that the person purchases, or the motion pictures they watch at multiplexes. Emergence of digital technology also put companies under pressure to offer better competitive prices to end users. Though this phenomenon was observed mostly in advanced and developed countries, markets in developing regions were weak but presented a good opportunity for future growth.
Music piracy is growing rapidly leaving the legitimate music industry gasping for sales. While demand for music reached an all time high, sales have actually dropped. Much of the decrease in sales is to be blamed on increasing availability of free music through Internet and due to mass copying, especially in the Asia-Pacific and Latin American regions. Annual sales for 2004 fell by about 1.4% in terms of value, the slowest since the turn of the century. Clearly, decrease in sales reflects how commercial value of music is being devalued by way of piracy. Proliferation of illegal sites has shown that demand for online music is flourishing.
Major companies covered include Universal Music Group, Sony BMG Music Entertainment, Warner Music Group, and EMI Group.
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