Shifting Music Industry Trends

The music industry is concerned not just with the distribution of CDs. Shifting industry trends have led record labels to adapt to such changes, too. For example, record companies are now partnering with online music stores to sell digital or MP3 files of the songs in their catalogues. This is a response to the rise of portable music players. It is also an effort to combat the illegal downloading of songs through file-sharing networks. Record labels are also trying to place limits on websites that allow members to upload and stream music, as such sites are reportedly becoming a preferred alternative to buying music.

Big players in the music industry are also reaching beyond CDs and digital files. They venture into the production of music videos and make sure that their rights to the videos are upheld, especially with the growing number of mobile phones and portable music players that are equipped with video playing capabilities. Record labels are also looking to the gaming industry, which uses songs not just as backgrounds for video games but as actual game components. This is the case with video games that involve dancing on a pad, hitting control buttons in time to the beat, playing a fake guitar and even striking fake drums.

Concerts and band merchandise are other sources of revenue for musicians. For record labels to earn more profits in the midst of plunging CD sales, companies have created the "360 deal." This type of contract gives a recording company the right to earn a percentage of all sales from ticket concerts, promotional merchandise, events tickets and more. In exchange, a band or musician gets years - even decades - of support from the company, which promises to work hard to create more events and increase the band's popularity.