investing in music Anitta 1975 Sevn Alias Justin Bieber Li Ronghao

This report is about record companies’ enduring value to music. In the digital world, the nature of their work has evolved, but their core mission remains the same. It is the mission of discovering and breaking new artists, building their careers and bringing the best new music to fans. These are the defining qualities of record companies’ investment in music.

Key statistics

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Section summaries

A record company works with a constellation of different teams, all centred around the artist.

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Music companies invest US$4.5 billion annually in discovering, nurturing and promoting artists.

The global recorded music industry in 2016 is highly investment-intensive, ploughing

of its revenue back into developing and marketing artists

Record companies invest heavily in local music, helped by a streaming world that has transformed the opportunities for local acts to reach fans.

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Record companies annual investment breaks down into two primary areas:

Record companies invest more than US$1.7 billion annually in marketing their artists. They also assign their own expert teams to create and deliver the campaigns that break their music worldwide.

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In addition to investing directly in artists, music companies also invest, along with distributors, in the fast-developing infrastructure of the digital market.

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The record company’s investment is the seed that can build a career, generating an array of other revenue streams.

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Anitta, Photo courtesy of Warner Music Group

Li Ronghao, Photo courtesy of Warner Music Group

Justin Bieber, Photo courtesy of Def Jam Recordings

The 1975, Photo courtesy of Universal Music

Sia, Photo by Mary Ellen Matthews

Maitre Gims, Photo by Fifou

Sven Alias, Photo by Ruud Baan