Music Category Itune Case Analysis and Impact

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There are eight main players in the music industry which can be categorised into three major processes: the creation, marketing and distribution of music (p.5). The creation of music is a creative process and often required collaboration among diverse set of entities (p.5). Marketing includes branding, information dissemination, promoting and advertising music to public. Distribution deals with the role of maintaining inventories of products for sale to customers (p.5). Each of members has their own role and needs which are summarized in the table. The first wave of change in music distribution came about with internet technology. Several e-retailers emerged in 1996 to sell CDs and audiocassettes online and this change has driven physical retailers to go online. However, in 1999, the online distribution model evolved again where users could locate and trade MP3 audio files through a search engine (p.6). However this music distribution change has come with a cost to recording industries and artists as the music industry believed they lost billions a year to pirating through sites and peer to peer network (p.10) Before ITunes came to the industry, many music record industries tried a number of approaches to response and curtail illegal pirating of music such as they demand restriction on computer’s CD-copying abilities and embedding anti-copying codes in CDs. However, most efforts backfired; Consumers do not like to purchase CDs that could only play only on standard player and not on computers, car systems and portable players (p.8). Their renting systems have also failed as consumers do not like to have limited ownership over the music (p.8) --- ITunes provide a better solution to artists and record companies and meet their needs by offering a legal and profitable route (p.9).Apple get five major labels, which are network hub, to back ITunes up by licensing a
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