Bmg Case Study

CASE STUDY IV.3 BMG(A) 2824309 Which geographic market areas should be chosen for closer analysis? Introduction Bertelsmann Music Group, (BMG), is the global music division of Bertelsmann AG, a transnational media corporation founded in 1835, based in Gütersloh, Germany. Its headquarters are located in New York. BMG, established in 1987, is now one of the world’s biggest music companies with more than 200 record labels in 42 countries. It is also home to one of the industry’s foremost music distribution companies and one of the world’s largest music publishing companies. According to Table 1 BMG is the world’s second record company in terms of global market share. Moreover Chart 1 shows that most of BMG revenues come from Europe and North America. Table 1: Global market shares of major players 2001 Vivendi Polygram Sony AOL Time Warner EMI BMG Market value % % % % % $ billion Australia 13 27 18 18 6 0.7 Canada 20 13 24 10 8 1.1 US 13 14 22 10 12 11.2 Japan 13 18 7 14 8 7.0 Germany 23 12 13 22 15 3.0 UK 22 13 11 22 9 2.4 France 32 25 13 19 11 2.3 Netherlands 23 14 8 15 13 0.7 Italy 19 16 17 15 24 0.6 Korea 10 5 4 5 5 0.5 Sweden 20 19 13 26 22 0.3 Taiwan 17 5 14 6 5 0.3 Other countries – – – – – 5.4 World 13 13 14 16 14 35.5 {draw:frame} * {draw:frame} {draw:frame} {draw:frame} * {draw:frame} {draw:frame} {draw:frame} {draw:frame} {draw:frame} {draw:frame} Global Music Market Analysis {draw:frame} Table 2 - Recorded Music Sales 2008 (trade value) Chart 3 - Global digital revenue {draw:frame} Record companies are gradually changing their approach to do business as a response of a dramatic change in the way music is distributed and consumed. Nowadays digital platforms account for around 20% of recorded music sales, up from 15% in 2007. Recorded music is facing the so called online and mobile revolution, generating more revenue in percentage terms

References: http://www.indianmi.org/ http://www.ifpi.org/ Hollensen, S. (2007), Global Marketing 4th Edition. UK: Pearson Education Limited