Music Industry
UK Market Review 2010
Market Research Report

Music Industry UK Market Review 2010 Market Research Report

Music is described as a `main hobby' (either playing, watching live or building a collection) by almost one in five UK adults, according to a November 2009 NEMS Market Research survey commissioned by Key Note. However, a much higher proportions of the population say that they listen to music every day, listen to it on the radio regularly or enjoy browsing in music shops, and 45.6% of homes contain a musical instrument (with just over a quarter of adults able to play one).

The importance of music in consumer lifestyles is also further emphasised by the results which showed broadening access to music, driven by new technology or other trends:

• slightly more than half of adults like watching `pop star' competitions on the television, such as The X Factor
• 44.8% listen to music on their computers
• 16.9% go to hear live music in concert, pubs or clubs at least once a month.

Amateur involvement with music is strengthening thanks to the `karaoke' or `have a go' culture engendered in pubs and clubs, by the peak-time talent shows and, most recently, by a tranche of video games such as Guitar Hero, which offer the chance to play along with `real bands'. At the professional level, live music is also doing well owing to improved venues, more efficient ticketing (online) and the fact that artists are keen to tour (and bands are keen to reunite) to make up for lost income on recordings.

In contrast to the healthy amateur and live sectors, the recording industry - still the largest part of the music industry - has been in the doldrums because of the transition from easily regulated sales on CDs through record shops to the downloading of music to home computers and mobile phones, much of which is illegal. However, legal downloading is increasing and Key Note forecasts that the recorded market will at least stabilise in value over the next 5 years (at around £1.15bn), although not regaining its previous heights.

Although music retailers such as Woolworths and Zavvi have fallen by the wayside, the leading retailer, HMV, remains strong and the recording industry is backed by four giants, which have been in place for more than a decade. One of these `majors' is the UK-based EMI Group, a major force for many decades and still reaping the benefits of having The Beatles in its back catalogue, while the label's Coldplay had the best-selling album in the US and the UK in 2009. The other majors, all of which are larger than EMI, are Universal, Warner and Sony.

For these majors, a complex pattern of music production and distribution is developing in which a piece of recorded music (or a published song), as an intellectual property (IP), is economically justified through a range of income sources: sales to consumers (CDs or download), live performance and royalties for use in compilations, in the media (old and new), as ringtones, in video games and movies or even in public houses (pubs) and shops.

• Executive Summary
• 1. Industry Overview
  • Report Coverage
  • Report Background
  • Economic Trends
  • Population
  • Table.1: UK Resident Population Estimates by Sex (000), Mid-Years-
  • Gross Domestic Product
  • Table.2: UK Gross Domestic Product at Current and Annual Chain-Linked Prices (£m),-
  • Inflation
  • Table.3: UK Rate of Inflation (%),-
  • Unemployment
  • Table.4: Actual Number of Unemployed Persons in The UK (Million),-
  • Household Disposable Income
  • Table.5: UK Household Disposable Income per Capita (£),-
  • Market Size and Segmentation
  • Table.6: The UK Music Market by Sector by Value (£m at Rsp),-
  • Figure.1: The UK Music Market by Sector by Value (£m at Rsp),-
  • Industry Structure
  • Market Shares
  • Market Position
  • Table.7: Popular Leisure Activities in The Home (% of Adults),
  • Key Trends
  • Legislation
  • `Digital Britain'
  • Key Trade Associations
  • British Recorded Music Industry
  • International Federation of The Phonographic Industry
  • UK Music
• 2. Pest Analysis
  • Political Factors
  • Economic Factors
  • Social Factors
  • Technological Factors
• 3. Key Note Primary Research
  • Attitudes to Music
  • Table.1: Consumer Attitudes to Music and Its Role in Consumer Lifestyles (% of Adults), and
  • The Core Music Consumer
  • Table.2: Daily Listening to Music at Home or in The Car and Music `Hobbyists' by Sex, Age and Social Grade (% of Adults), and
  • Favourite Artists
  • Table.3: Favourite Artists or Composers for A Desert Island (% of Adults),
  • Music in Home Leisure
  • Table.4: Popular Leisure Activities in The Home (% of Adults), and
• 4. Competitive Structure
  • The Marketplace
  • Recorded and Published Music Companies
  • Universal Music Group
  • Company History
  • Current Structure
  • Recent Developments
  • Financial Results
  • Table.1: Universal Music Group Financial Results (5m), Years Endingst December-
  • Sony Music Entertainment
  • Company History
  • Current Structure
  • Recent Developments
  • Financial Results
  • Emi Group
  • Company History
  • Current Structure
  • Recent Developments
  • Financial Results
  • Warner Music Group
  • Company History
  • Current Structure
  • Recent Developments
  • Financial Results
  • Other Major Companies in The Music Sector
  • Apple Inc
  • Hmv Group
  • Live Nation
  • Table.2: Live Nation Operations in The UK (Number and), Years Endingst December-
  • Table.3: Live Nation Financial Results ($M), Years Endingst December-
  • Yamaha Corporation
  • Broadcasters
  • British Broadcasting Corporation
  • Other Broadcasters
  • British Sky Broadcasting Group Plc
  • Itv Plc
  • Others
  • outside Suppliers
  • Marketing Activity
• 5. Recorded Music Market
  • Introduction
  • Key Trends
  • Market Size
  • Table.1: The UK Market for Recorded Music by Type of Recording by Value (£m at Rsp),-
  • by Market Sector
  • Albums
  • by Musical Genre
  • Table.2: Album Sales by Musical Genre by Volume (%),-2005,, and
  • Pricing, Re-Issues and Compilations
  • by Artist Nationality
  • Supply Structure
  • Table.3: UK Market Share of Album Sales by Company by Volume (%),-
  • Major Players
  • The `Majors'
  • Independents or `Indies'
  • Labels and Artists
  • Labels
  • Umg
  • Sony
  • Warner
  • Emi
  • Artists, Albums and Songs
  • Distribution
  • Trade Associations
  • Marketing Activity
  • Table.4: Main Media Advertising Expenditure on Recorded Music by Artist and by Compilation (£000), Year Ending September
  • Buying Behaviour
  • Regular Purchasers
  • Table.5: Regular Purchasers of Music Cds (% of Adults), and
  • Music Downloaders
  • Table.6: Purchasers of Music Downloads from The Internet (% of Adults), and
  • Forecasts
  • Table.7: The Forecast UK Market for Recorded Music by Type of Recording by Value (£m at Rsp),-
• 6. Recorded Music Distribution
  • Introduction
  • Key Trends
  • Market Size
  • Table.1: The UK Market for Recorded Music by Distribution Channel by Value (£m at Rsp),-
  • by Market Sector
  • Supply Structure
  • Table.2: Market Shares by Distribution Channel by Music Product by Value (%),
  • Major Players
  • Marketing Activity
  • Buying Behaviour
  • Music Shop Browsers
  • Table.3: Music Shop Browsers (% of Adults), and
  • Forecasts
  • Table.4: Forecast Market Shares by Distribution Channel by Value (%),
• 7. Music in The Media
  • Introduction
  • Key Trends
  • Market Size
  • Licensing Statistics
  • Music in Consumer Leisure
  • Table.1: UK Consumer Expenditure on Selected Home Entertainment at Current Prices (£m),-
  • by Market Sector
  • Licensing Statistics
  • Table.2: Prs for Music Earnings for Rightsholders (£m), and
  • Media Sectors
  • Radio
  • Television
  • Magazines
  • Table.3: Leading Music Magazines by Circulation (Number of Copies Sold per Issue), January to June
  • Supply Structure
  • Major Players
  • Table.4: Major Companies and Corporations in UK Broadcasting,
  • Marketing Activity
  • Buying Behaviour
  • Radio Listening
  • Table.5: Regular Listeners to Music on The Radio (% of Adults), and
  • Music on Home Computers
  • Table.6: Users of Computers for Listening to Music (% of Adults), and
  • Pop Star Competitions on The Television
  • Table.7: Viewers of Television Pop Star Competitions (% of Adults), and
  • Forecasts
  • Table.8: Forecast UK Consumer Expenditure on Selected Home Entertainment at Current Prices (£m),-
• 8. Live Music
  • Introduction
  • Key Trends
  • Market Size
  • Table.1: UK Consumer Expenditure on Entertainment outside The Home (£m),-
  • by Market Sector
  • by Type of Music
  • by Type of Venue
  • Supply Structure and Major Players
  • Popular Music
  • Ticketing
  • Classical and Specialist Music
  • Marketing Activity
  • Table.2: Main Media Advertising Expenditure on Theatres, Plays, Concerts and Other Shows (£000), Year Ending September
  • Buying Behaviour
  • Table.3: Regular Listeners to Live Music (% of Adults), and
  • Table.4: Attendance at Concerts by Type of Music (% of Adults, Any Frequency),
  • Table.5: Attendance at Pop/Rock, Classical and Jazz Concerts by Sex, Age and Social Grade (% of Adults),
  • Forecasts
  • Table.6: Forecast UK Consumer Expenditure on Entertainment outside The Home (£m),-
• 9. Amateur Music
  • Introduction
  • Key Trends
  • Market Size
  • Musical Instruments
  • Table.1: UK Market for Musical Instruments by Value (£m at Rsp),-
  • Table.2: The Market for Musical Instruments by Type by Value (£m at Rsp), and
  • Other Spending
  • Supply Structure
  • Musical Instruments
  • Major Players
  • Marketing Activity
  • Buying Behaviour
  • Table.3: Involvement in Amateur Music (% of Adults),
  • Forecasts
  • Table.4: Forecast UK Market for Musical Instruments by Value (£m at Rsp),-
• 10. A Global Perspective
  • Recorded Music
  • Table.1: Global Recorded Music Sales by Format ($Bn), and
  • Table.2: Global Top-Selling Albums,
  • Other Music
• 11. The Future
  • Introduction
  • The Economy
  • Population
  • Table.1: Forecast UK Resident Population by Sex (000), Mid-Years-
  • Gross Domestic Product
  • Table.2: Forecast UK Growth in Gross Domestic Product in Real Terms (%),-
  • Inflation
  • Table.3: Forecast UK Rate of Inflation (%),-
  • Unemployment
  • Table.4: Forecast Actual Number of Unemployed Persons in The UK (Million),-
  • Forecasts to
  • Table.5: The Forecast UK Music Market by Sector by Value (£m at Rsp),-
  • Market Growth
  • Figure.1: Growth in The UK Music Market by Sector by Value (£m at Rsp),-
  • Future Trends
  • Copyrighted Music
  • Tracks Not Albums
  • Role of Music
• 12. Further Sources
  • Associations
  • General Sources
  • Government Sources
  • Other Sources
  • Key Note Sources