Which country produces the most CDs

mica - music austria

The traditional ways for music creators to bring a product (e.g. a phonogram) onto the market have changed dramatically in recent years. Where it used to be necessary to rely on the work of the independent or major labels, today musicians and smaller labels have many alternative options.

A wide variety of innovative technologies and access methods open up new opportunities for music creators as well as for (independent) labels and music production to operate in the market.

What are label services?

Label services offer a wide variety of services for labels (but also for artists) in terms of marketing, advertising, sales, licensing and much more. What most label services do not cover is the area of ​​operations management, which includes financial planning and control as well as labor and corporate law.

Label services are pure services at a mostly fixed price or for a share of the turnover for artists, managers or small labels. The pricing is therefore largely independent of the success of the product. Artists and their management take over the control of these offers or the operational management themselves.

In the traditional model, labels have collected rights for music and exploited them until the end of the legal protection period (currently up to 70 years after publication). Label services, on the other hand, only perceive this for a certain time, if at all. After this period of use has expired, all rights are returned to the artist.

What types of services fall under label services?

The term artist service is also used in this context. This term refers to the target group. The same services are offered on the one hand for labels and on the other hand for musicians as a target group. They have the same goal: to recycle a product.

While music creators who represent themselves tend to use the full range of label services, small labels outsource those services that they cannot offer themselves. Both use the offer to strengthen the range, effectiveness and profitability of their products. The difference to the label is that music creators exercise or have to exercise the control and management of these offers themselves. If necessary, they are supported by a management team.

The range of products is different for each provider. The label services differ from one another in the form and composition of their offers.

Important areas of (artist) and label services

Physical and digital sales and distribution: The intention here is to distribute the product by means of the most efficient and widespread digital distribution possible via various platforms such as iTunes, Spotify, YouTube, Deezer, etc. This also includes the physical distribution of records and CDs.

Marketing and PR services: These include the national and international planning of the releases, marketing strategies and campaigns for the market launch. Marketing services often also help artists and labels to find the right promotion team for online, point-of-sale (POS), TV, print and sales marketing strategies in order to design a campaign that is as suitable as possible. Advice on the efficiency of social media profiles on Facebook, Twitter, YouTube, Instagram, email marketing and websites is also offered, sometimes including a suitable digital marketing strategy.

International networks (such as sub-publishing networks), which are otherwise not available to the individual musicians or labels, are offered and used to bring the product to the relevant target group.

Ancillary copyrights: In order to ensure the correct billing of royalties for both performers and producers, a professional registration service or advice can be offered depending on the offer.

Manufacturing: This area supports artists and labels in the production of products of all kinds, whether it is a record or a merchandise product. Services such as advice and control of the organization, but also logistics and storage of the goods are offered here, so that faster sales and more competitive prices are made possible.

The area Reporting, Analytics & Budgeting mostly offers evaluations of all the individual services offered, with which the customer can, for example, track successes and failures of campaigns or numbers regarding releases and streams. Figures for recording sales (physical, digital and online), income, costs and storage are mostly reported on a monthly basis.

Licensing: Here the attempt is made to place the products with so-called third-party providers such as TV, film, games and the like by using mostly global contacts.

Depending on the size and focus of the respective label or artist service, these services are offered in different compositions.

Who offers label services?

International providers

There are some companies that have established themselves in this rather new market. Some of these providers have developed from traditional labels that wanted to offer new offers for new customer groups due to the aforementioned rapidly changing conditions on the music market. Others have developed this business area without a label behind it.

The following companies are internationally known providers of label services:

  • PIAS: This company, founded in Belgium in 1983, is now the largest provider of artist and label services. The [PIAS] Group is now based on three branches, namely [PIAS] Artist & Label Services, [PIAS] Cooperative Labels and [PIAS] Recordings and is increasingly specializing in an offer that is either tailored to artists or labels.
  • ADA Label Services: Founded in New York in 1993, ADA (Alternative Distribution Alliance) is the Indie Label Services branch of the Warner Music Group and thus one of the older representatives of this type of business.
  • Absolute: The service provider founded in London in 1998 as Absolute Marketing & Distribution, which was renamed and rebranded absolute: The Label Services Business in 2015, did not arise directly from a label context. This acts as a classic label services provider and offers the sale of digital content, marketing services, reporting and budgeting as well as the sale of physical products and much more. The rebranding also brought a more modern line.
  • BMG: The Bertelsmann Music Group (BMG) has been a Berlin subsidiary of the media company Bertelsmann (SE & Co. KGaA) since 2008 and also provides all-round label services with licensing, synchronization rights management, publishing, etc. However, BMG still operates mainly as a classic publisher or record company.
  • Kobalt Label Services / AWAL, one of today's most successful label service providers, was founded in 2012 as part of the Kobalt Music Group. This went hand in hand with the takeover of AWAL, a company that until then had 5,000 indie artists (such as Radiohead, Arctic Monkeys, etc.) among its customers and a global sales network with over 200 digital retail partners (such as iTunes , Amazon, Spotify, Deezer). In 2018, the Kobalt Label Services branch continued to develop and was branded again under the AWAL brand.
  • Caroline International: Universal Music started this independent label services branch in 2013, which was previously known as the longtime EMI label distribution by Virgin Records. Caroline International offers a wide range of label services such as B. Distribution of digital content and physical media, marketing, analytics, promotion, press work, royalty and license accounting, project management, sync licensing, etc.
  • The Orchard: As a music distribution platform, The Orchard merged with the former label services branch of Sony (Red Essential) in 2017 and later (2020) with Sony / ATV Music Publishing. The company now offers global services such as full-service marketing, licensing, video services, data analysis, advertising, rights management and physical & digital distribution.

Label services in Austria

The label services business model currently only exists to a limited extent in Austria. In Austria there are more companies that work as one-person companies or that have specialized in offering only parts of the wide range of all label services. Label services in Austria also emerged partly from larger (Austrian) labels in line with international developments.

Which Austrian companies are there that offer label services?

There are currently (March 2021) no companies in Austria that specialize exclusively in all aspects of label services. However, there are also some companies in Austria that offer certain aspects of label services.

Label services relating to the reporting, analytics & budgeting sub-area include all supporting offers on the subject of campaign evaluation or figures relating to releases and streams.

  • Fortunes- Reporting, Analytics & Budgeting:
    The company Fortunes, founded in 2015, sees itself as a "Music Data Hub" in that it tracks, analyzes and visualizes data from musicians and producers using an app (on iOS / Android / desktop). This Viennese music technology start-up offers the service for both musicians and labels.
  • OFFICER Solutions- Billing / budgeting
    A company based in Langenlois (Lower Austria) that falls under the “budgeting” category, but also deals with royalty services and accounting.

In the area of ​​the distribution of digital content and physical media, it is about the efficient and widespread digital distribution of music via various platforms. This also includes other related areas such as B. the physical distribution of records and CDs.

  • Rebeat- Physical and Digital Sales & Distribution
    is an Austrian company known for the digital distribution of music with headquarters in Tulln. In addition to digital sales with rights management, data analysis and reporting, this also offers promotional activities (placement in stores, playlist pitching, etc.). Rebeat provides artists and labels with software that includes a comprehensive accounting system with add-on modules for accounting for revenues from digital and physical sales, as well as merchandise and ticketing. The cost accounting service was added a little later. Here, all income and expenses of a label can be added to a cost center, divided between contractual partners and billed.
    At Rebeat, some services are designed for labels, but it should be noted that these services are also available to all artists.

Since the sub-area Marketing services encompasses every facet of marketing, there are also some very different approaches to help labels and artists in a wide variety of areas.

  • Ink Music- Synchronization, marketing services, international networks, management, booking, publishing
    Swimming Pool, which existed between 2010 and 2015 as a company specializing in dubbing law (film production law, work association law), was reintegrated into Ink Music GmbH. Ink Music now offers a wide range of services such as artist support and development, career planning and support, booking, publishing, film production law, licenses and public relations. The company not only provides these services to artists, but also to labels.
  • Preiser Records- Marketing services, recording production, physical and digital distribution, ancillary copyrights
    offers a wide range of services. This includes CD production, sales, marketing, promo, data maintenance and processing, collecting society and ancillary copyrights. However, social media management and similar services cannot be offered, although the issue has recently become more urgent. Preiser Records was founded in 1952 by Otto G. Preiser and is therefore an Austrian label with a long and traditional history. Here, too, an attempt is made to differentiate between artist and label services, but in practice these two areas often overlap.

What does the large number of non-traditional actors mean?

How the market will develop over the next few years, with more and more players and correspondingly new offers, is uncertain despite positive forecasts from individual protagonists. In practice, the “Label Services” service is primarily used by artists, but due to the flexibility of the offers, it can also be used by labels. Thus, providers of label services appear on the one hand as cooperation partners, but on the other hand also as potential competitors for the classic label forms, who have mostly understood these services as part of their offer.

Development of label services

The so-called label services deals made up a good eight percent of the market in 2019, "but the segment is growing by a third every year," says the head of the London-based analysis firm Midia, Mark Mulligan. Label services are gaining in relevance internationally. In addition, label services offer classic labels the opportunity to concentrate more on their actual core business and thus to outsource some of the challenges of rapid digital development.

The more professional artists act in their independence and self-determination, the more labels find themselves in this service-providing, know-how transferring position. However, this trend towards label services sometimes also has other implications for artists. It is primarily a shift of the financial risk away from the label and towards the artist - this development already existed before with the topic of the band takeover contracts. On the one hand, this increases artistic freedom and self-determination, whether or not this also promotes creative work or whether it is more popular with the public remains to be seen.

According to the industry’s own assessment, the future of label services in Austria is also seen as positive overall. There is an upward trend in the digital sales service in particular. Almost every sales department now offers artist and / or label services and these are also used by customers. The areas of marketing, social media management and playlist placement are also developing positively.