Record Labels In The Digital Age

The following is a guest post by the writer of the Captain Maudlin blog, for whom I also wrote a post about record labels. You can go to his blog here: to read my piece, music reviews, and other wonderful musical musings!

record labels

In the age of torrents, Bandcamp, and the other methods of internet-based music subscription, it seems that the DIY ethic of independent artists of the past has effectively penetrated every aspect of the music industry. In a world where it seems superfluous to even print CDs anymore, we must consider a rather shocking question: are record labels dying?

From the inception of the modern music industry, the record labels were the unavoidable go-between for artists and music consumers. In the days of Elvis Presley and Ray Charles, there were, on the one hand, virtually no artist-run labels like we see today, so those artists couldn’t publish music themselves, but there were also no “major labels” as we know them today. Regions had their own record labels that put out the music of artists who recorded in their region. However, with the rise of nationally and internationally recognized superstars like Elvis and those that followed him, record companies got bigger and bigger. In the 70s and 80s, this led to a huge consolidation of record labels, until what became known as the major labels started to appear. The Big Six of Warner Music Group, EMI, CBS Records, BMG, Universal Music Group, and Polygram came to own a majority of the music being produced worldwide, all the way to the present day, where the remaining 3 major labels of Warner, Sony, and Universal own 80% of the industry in the US, and 70% worldwide. These labels operate countless imprints, like Universal’s Def Jam, EMI, and Capitol, Sony’s RCA records, and Warner’s Sub Pop, which allows them to remain extremely diverse. Thus, unless you’re a niche artist who only appeals to an underground demographic like punk rock or EDM fans, you’re more than likely going to be signing to a major label.

Signing to a major label, in the past, has come with a number of benefits and drawbacks. On the one hand, record labels could distribute the artist’s music to a wider audience, provide them with more money to spend on recording and mixing their records with the latest in recording technology, put highly accomplished, professional producers at their disposal, spend more advertising dollars promoting their record, hooking them up with nationally televised live appearances, push their music to radio stations, and make sure their music stays popular. They also are largely responsible for setting up tours, which is where a bulk of the money for artists comes from. On the other hand, with the huge investments the labels put into the artist’s music and image, they expect to make their money back, and a huge profit on top of that. As a result, they do not hesitate to exercise varying degrees of creative control over the music, expecting it to sound marketable to a wider audience, sometimes in contradiction to what the artist may want out of their music. In addition, the major labels have an enormous roster of musicians they have to work with, meaning that the artist’s music, if they are new or aren’t a top seller, may not get the attention it deserves by the label. Also, the labels often are most concerned with making money, which means that they may offer extremely unfair deals to new artists who are inexperienced with the industry.

With indie labels, the artist can avoid overt control of their product, greedy executives who care more about money than music, and can get due attention from their label. However, indie labels don’t have the money or connections the major labels do, and so are limited in that way.

The rise of the internet, however, has totally changed the game. Now, an artist can record his music for free on his computer, put it on websites like Soundcloud or Bandcamp and distribute it all over the world for next to nothing, and circumvent the necessity of record labels almost completely. Almost.

This new medium has certainly put record labels in an awkward position. When bands like Radiohead and Nine Inch Nails self-release albums over the Internet, and make more money for themselves than they ever did releasing albums through record labels, one has to wonder why anyone would ever work with a label again. However, these are established artists, who have already made important connections in the industry and have solid fan bases. With new artists, it is more complicated. Using the internet, anyone can make music and put it out into the world for exposure. But with so many artists all using the same media, it makes it extremely difficult to stand out. They lack the connections they would gain when signed with a label, the money, the mainstream advertising. Record labels also give artists licensing deals – there are no self-releasing artists with music in iPod commercials. And without record labels, it’s very difficult to procure gigs outside of an artist’s immediate area.

In effect, with the way music is being consumed now, largely for free on the internet, has rendered obsolete the monopoly record companies have traditionally had on recording and distributing music. With the physical format of CDs dying, and the dominance of the digital format and online distribution, the record labels’ days in these fields are numbers. However, contrary to Thom Yorke’s best intentions, record labels are still vital to the music industry. They still provide lucrative licensing deals, they still promote their artists in a way they never could through the internet alone, and they still have crucial connections when it comes to touring and booking. The Internet age has not been a death knell to the music industry – it has simply forced it to adapt and evolve. There are still enormous opportunities to be had in Internet advertising, deals with services like Spotify and Slacker, and  the evolving medium of the music video through YouTube and Vevo.

So while many bemoan the decline of the music industry due to file sharing and digital media, while others herald its demise as the dawn of a new age where musicians can focus on making art rather than making money, in truth, the music industry isn’t in decline, it’s simply evolving. While sales of music are a fraction of what they were at their peak in the late 90s, digital or otherwise, record labels still thrive, they just collect their profits through other media. Record labels likely will never become totally obsolete, they will simply continue to change with the times.

Jake Hook is a blogger from Los Angeles, specializing in music reviews and opinion pieces. He is a DJ at UCLA Radio, the #1 student-run, internet-only radio station in the country, and interns for Dumblebee, an advice-based social media site. You can follow him at his blog,



2 thoughts on “Record Labels In The Digital Age

  1. Pingback: CM Editorial: How You’re Killing The Music Industry, And What You Can Do To Stop It | Captain Maudlin

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