Global Music Distribution A Buyer’s Market

The 20,000 Foot View:  The internet was supposed to be the great leveller, enabling smaller artists and labels to reach global audiences in a way not previously possible. But, it turns out that getting music to these global fan bases is not quite so straightforward. Smaller labels simply do not have the resources to enable them to distribute music across all territories. In fact, the compulsion to reach more markets actually increased the need for global capabilities not reduced it. The solution to emerge was third party distribution companies that are now a crucial part of the business of most independent labels. The majors were quick to recognise the opportunity and establish themselves as central players in this fast-growing sector.

Key Findings

• Global distributed            revenue was            million in 2017,                       of all recorded music revenues            up from            million the prior           
• The market            highly competitive with more than            or labels acting as distributors            other labels
• Standard digital            fees average around            of gross,            physical averages around           
• However, pricing            significantly, with fees paid ranging            as low as            to as            as           
• Major labels            for            of distribution revenue
• The independently            distributor market was worth            million            2017
• As Merlin            scale more labels will be            for digital supply chain services            than full suite digital distribution
• Streaming services            likely start striking more direct            with independent labels, especially those            distributed via major labels or            owned companies

Companies and brands mentioned in this report: AWA, Beggars Group, Believe Digital, Big Machine, CD Baby, Consolidated Independent, Ditto, FUGA, Kontor New Media, InGrooves, Merlin, PIAS, Sony Music, Spotify, The Orchard, Tunecore, Universal Music, Vivendi, Warner Music