Sonybmg Case Study
Synopsis
In 2004 a joint venture was created by Sony Music Entertainment and Bertelsmann Music group to create Sony BMG. With 46 offices all over the world, Sony BMG finds there headquarters in New York. The company aims to provide a wide variety of music through limitless distribution channels. Sony BMG caters to almost 1,000 artists in six different genres. Despite the problems Sony BMG has dealt with in the past four years, they have stayed strong in their position as the second largest recording company. They have problems with their top executives and powered through new ideas which turned out to be some of the worst decisions. Sony BMG is dedicated to customer satisfaction and introducing artists into as many markets and divisions as possible. Problems
• Sony and BMG executive clashing over management styles
• Follow the Leader mentality
• Inability to cope with Illegal downloading
• Advertising their artists instead of themselves as a company
SWOT Analysis (See Appendix Part A)
The Music Industry
The music industry is the largest art related industry in the world. The SIC code of the music industry is 3652, which is the Phonograph Records and Prerecorded Audio Tapes and Disks. Basically, it concerns the creation and selling of CDs, cassette tapes, and now the new realm of the internet mp3s (US Department of Labor, 2008). It has been around, to a lesser extent, since the 1700s, when musicians first began to make a living selling their music to the public (Glover, 2005) and has progressed from selling sheet music to now using the internet to pass along music. It is constantly expanding with thousands of albums being produced every year with new ways to distribute the constantly changing music. Getting into the physical industry (selling CDs) is fairly easy, but succeeding on a global scale requires an immense amount of luck, ability, and financial backing.
The market structure, like most established and large industries, is an oligopoly.
In 2004 a joint venture was created by Sony Music Entertainment and Bertelsmann Music group to create Sony BMG. With 46 offices all over the world, Sony BMG finds there headquarters in New York. The company aims to provide a wide variety of music through limitless distribution channels. Sony BMG caters to almost 1,000 artists in six different genres. Despite the problems Sony BMG has dealt with in the past four years, they have stayed strong in their position as the second largest recording company. They have problems with their top executives and powered through new ideas which turned out to be some of the worst decisions. Sony BMG is dedicated to customer satisfaction and introducing artists into as many markets and divisions as possible. Problems
• Sony and BMG executive clashing over management styles
• Follow the Leader mentality
• Inability to cope with Illegal downloading
• Advertising their artists instead of themselves as a company
SWOT Analysis (See Appendix Part A)
The Music Industry
The music industry is the largest art related industry in the world. The SIC code of the music industry is 3652, which is the Phonograph Records and Prerecorded Audio Tapes and Disks. Basically, it concerns the creation and selling of CDs, cassette tapes, and now the new realm of the internet mp3s (US Department of Labor, 2008). It has been around, to a lesser extent, since the 1700s, when musicians first began to make a living selling their music to the public (Glover, 2005) and has progressed from selling sheet music to now using the internet to pass along music. It is constantly expanding with thousands of albums being produced every year with new ways to distribute the constantly changing music. Getting into the physical industry (selling CDs) is fairly easy, but succeeding on a global scale requires an immense amount of luck, ability, and financial backing.
The market structure, like most established and large industries, is an oligopoly.
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