Major Labels vs Indie Labels

Characteristics of major labels

- Examples include the Warner Music Group, Universal Music Group and Sony Music Entertainment.

- Major labels are often owned by international conglomerates; for the examples above, WMG is owned by Time Warner, UMG by Vivendi, a French mass media conglomerate, and SME is a subsidiary of the Sony Corporation of America.

- These conglomerates also own other media production companies, such as film production companies, television channels, magazine outlets and graphic design agencies. This gives them a lot of control over the media industry, as collaboratively they own a large market share (70% of the world market, and 80% of the US market)

- A major label is defined by its owning of "...more than 5% of the world market(s) for the sale of records and/or music videos."

- The larger labels tend to have headquarters in the USA, and therefore American artists receive heavier promotion and also have a greater chance of establishing a brand identity for themselves.

- Advantages: A lot more money available to spend on production, marketing and distribution; connections with prominent figures in the industry

- Disadvantages: Artists lose creative control over how they are branded and the major record labels are also very selective as they have to consider commercial viability.
 

Characteristics of Indie Labels

- Independent record labels tend not to own their own distribution channels.

-'Indie' is a term that also encompasses types of music that are considered non-mainstream.

- Independent labels also work in favour of mainstream music artists, in giving them an opportunity to discover and promote new talent.

- Artists under independent labels have to work a lot harder to challenge the market share of the major labels, especially since their budgets do not accommodate for extensive marketing campaigns.

- Advantages: Indie labels have the freedom to work in a variety of music genres, enabling new artists to continue producing music with the support of the label. Also the professional relationship tends to be closer and therefore guaranteeing individual attention. Indie labels also allow for more creative freedom.

- Disadvantages: Funds are limited; less coverage in the media; do not own the necessary distribution channels to promote the music.