Emi Group Plc In The Music Publishing And Recording Industry Essay

euphony and enter perseverance present interesting exploitation due to the introduction of newlyly artists and the evolution of new harmony genre, to institute a few. In addition, the industry alike experiences crucial challenge due to the promotional material in digital applied science that drives the industry to find bewitch ways in winning the competition. The challenge occurs since there is a divergency circumstances in the competition of media industry where previously the earth of new media does non eliminate the old media. The existence of commercial radio, for example, does not eliminate the print media wish well magazines and news written report.Similarly, the existence of television broadcasting also does not eliminate the existence of radio and news topic. In many cases, the television spreader also owns radio and newspapers companies to complement their media descent. However, the situation may be entirely different in the digital age where the exis tence of internet and the nonplusment of digital technology exchangeable file compression (MP3, mpeg, and file-sharing technologies etc) could completely bulge the old model of practice of medicine distri justion such as mash disc.The so-called MP3, often refers to MPEG-1 Audio Layer 3, is an audio frequency encoding coiffe that reduce the file size from tens of megabyte (when using WAV or foreshorten disc do) into less than 5 Megabyte (MB) in MP3 format for oneness same song. Audio Galaxy and Napster atomic way out 18 two companies that employ file-sharing technology that enables their members/customers to exchange their euphony or video with others members/customers (Karp, 2007). Immediately, the invention of new audio encoding format increases the sales of portable digital music players like iPod.Coupled with the increased international internet bandwidth, the exchange of MP3 files rises signifi apprisetly. A cast of websites that enable purposers or music lovers to download the desired songs in MP3 format also rises. Despite the attractiveness of MP3 technology for audio, MP4, and MPEG for video, the technologies ca personas severe violation of reform of first publication as downloading music and video without paying royalties to the owners/singers of the music is considered as plagiarisation in digital world/domains. Concerning the challenges in the music and arranging industry, this paper will discuss about Emi aggroup plc, a giant in music and recording industry.In particular, there are some(prenominal) issues including the acknowledgment of strategic choices that EMI performs, EMI and its critical success factor outs in competing in the industry in spite of appearance the last five geezerhood, and the use of enamor management concepts in evaluating the suitableness of EMIs current strategies to deal with future competition. 2. Aim and Objectives The objectives of this paper are to analyze current and future positions of EMI meeting plc in the music publish and recording industry.Systematically, we can derive the objectives into four points. First is to analyze the dodge of EMI Groups plc that positions the troupe in the music and recording industry. Second is to use the appropriate look for methodology, this paper is to assess EMI Group plc and its critical success factor in the last five years. Third is to use the relationship of research approach, deductive, quantitative to explore key resources and capabilities of EMI in the next five years and assess whether they can create sustainable competitive advantage.And fourth is to use the non-participant observation method, collecting data and analyzing qualitative information from journal, books, magazine and on parenthood materials, this paper is to adopt the management concepts to evaluate the appropriateness of EMIs current strategies for the future. 3. doorkeepers Five Forces This section will discuss Porters five forces on EMI Group the recordin g industry which details the panic of new entrants, authority of bribers, power of suppliers, rivalry among existing competitors, and the threat of transfigure products for marketplace place organizer or transaction service provider industry satisfy chase diagramFigure 1 plat of Porters Five Forces Source Porter, 1998 3. 1 Rivalry In music publishing and recording industry, competitive advantage plays a significant role in winning a competition. This is because it represents not only the greater benefits in terms of products but also in other Ps of merchandise mix (place, promotion, and price). The possession of specific competitive advantages increasingly important since nowadays, customers use emotional side than rational side when decide which products or service they want to use (Manjoo, 2003).The rivalry in recording industry is quite intense since EMI Group does not only compete with confusable family like Universal unison Group, Sony BMG, and Warner Music Group but also illegal diffusion both in traditionalistic and web-based distributors by dint of several(prenominal) kinds of file-sharing program like Napster. Napster becomes the catalysts of online music service (Rupley, 2003). In night club to prevent the statistical distribution of illegal copy of music, Hodges Shaw and Brian B Shaw (2003) says that government has persuaded users regarding sizeableness of not using file sharing for copyrighted materials over the lucre by considering it as illegal actions.3. 2 Barriers to Entry One of putting green barriers to enter a new market is brand loyalty or in terms of multinational business, the main barrier could be the nationalism. In music industry, one significant challenge that continues establishs popularity is iTunes, a legal web-based music distribution from Apple Company. In music industry, especially regarding the competition surrounded by EMI Music and p2p companies and iTunes, the brand loyalty is obvious since the fever for iPod products has driven the use of iTunes to download legal music (Manjoo, 2003). The entry to some markets like educations gets fiercer as Jason E.Lane and Margaret A Healy (2005) revealed in their article File Sharing, Napster, and Institutional Responses Educative, Developmental, or Responsive Policy that file sharing (including music, video, and file sharing) has been parts of students activities. They unremarkably use the internet to share their favorite music and movies illegally. In addition, Scott (2001) and dingdong et. al (2002) reveals that file sharing remains a popular services due to their offering free downloading music and video. 3. 3 Products Substitution adjoin of product substitution is possibly the most overlooked factor although its shock absorber is damaging.Therefore, it is imperative that business must not only look at what the alliances direct competitors are doing, but what other types of products wad could buy instead. The products substitution for E MI Group is the introduction of various digital formats like MP3 and MP4 that substantially downloadable that enables customers to convert the CD format to MP3 and distribute it by e-mail. This is because EMI Group mostly still relies on the distribution of music in CD format that they believe is still better than others do. Figure 2 Music Format Source RIAA, 2006 3. 4 Buyer PowerIn music distribution and recording industry, there are some factors that influence buyer power including size of buyer (larger buyers will have to a greater extent power over suppliers), number of buyers (when there are a small number of buyers, they will tend to have more power over suppliers), and purchase quantity. 3. 5 Supplier Power Concerning the supplier power in recording industry, we find that digital format developer that invent MP3 and p2p technology continue gain popularity that further drive the customers to increasingly avoid the use of products distributed by recording companies (Manjoo, 20 03). 4.EMI Groups plc Strategic Position in Music Publishing and Recording industry Realizing the fierce competition that occurs in the music and recording industry, EMI Group develops several strategies such as the selection of new talents that will hit the market and develop sustainable distribution system to speed up the existence in new market. Among the distributions system, EMI Group appropriately conduct stick think with foreign companies in order to smooth their distribution. One of them is with EMI Televisa joint opine that helps EMI Group to distribute Celestial and other English language album (EMI Group, 2006).The purpose to conduct joint profess is a good outline to be implemented for EMI Group since it is a model in business that composes of two or more enterprises that join hand-in-hand to increase their competitive advantages. In this scheme, joint punt is somewhat similar to partnership but joint venture is derived from one business transaction. critical p oint venture is preferred because it can help companies to divide potencies, reduce threats, and raise competitive advantages in the market. Joint ventures can be formed as separate business units or cooperation between businesses (Corporate Venture Strategies, 2001).Developing a joint venture properly can obtain many benefits and advantages, such as dividing expenses and risks, enhancing right of entry to monetary resources, ad tutelage to innovative knowledge and consumers, and admission to new decision-making performs. Moreover, companies are able to have some bearing on morphological development of the business. Conduction of knowledge and skills are also accomplished easily (Corporate Venture Strategies, 2001). 5. EMI Strategic Choice EMI Group plc is a well-known company in music and recording industry.The company is currently comprehend as the fourth largest recording company in the world hobo Universal Music Group, Sony BMG, and Warner Music Group. The company main busin ess is the distribution of compact discs, videos, and other formats under the auspices of their subsidiaries and partners including EMI Records, Capitol, and Virgin (Yahoo Inc, 2008). The label company is behind the success of many famous artists such as Norah Jones, Lenny Kravitz, and The Beastie Boys. Currently, the company also handles more than one million songs.The strategic position of the company has attracted many larger companies such as Warner Music Group (WMG) to takeover EMI Group plc. Although many acquisition attempts, the company finally bought by Terra Firma, a private equity firm, for $4. 9 billion in 2007 (Yahoo Inc, 2008). 6. EMI and Its Critical success Factor The winning strategy of EMI Group exists since the company is suitably conducting several strategies that benefit the company in the long term. One of popular strategy is the decision to outsource their CD manufacturing in Australia.This decision occurred in 2004 where EMI Music and Warner Music conduct a greement with Summit Technology Australia Pty Ltd to own CD Manufacturing business together (EMI Group, 2006). This strategy provides great benefits for EMI Group since the company importantly obtains costs reduction and helps the company to insulate the business from the effects of changing volumes. Figure 3 Reasons of Outsourcing Source Outsourcing World Summit This is in line with the general benefits of outsourcing where costs reduction becomes the main issues that companies perceive.When discussing the outsourcing business model, the images refer to advantages that organizations obtain, especially refers to costs reduction. However, the benefits of outsourcing do not merely the cost reduction. Figure 3 shows six main reasons of carrying out outsourcing in an organization like EMI Group according to Outsourcing World Summit. Similarly, to costs reduction, outsourcing also provides benefits of helping the company to emphasis on core competencies. In theory, outsourcing is only used for delegation of non-core activities concerning the mission statement of the company.Nevertheless, many corporations outsource some of their core functions to gain more value in competitive advantage. Furthermore, many if an organization is able to develop a good relationship with its outsourcing partner, the long-term effect would be a sustainable competitive advantage. Another critical success factor is the decision of EMI Group to take benefits of digital technology. Previously, the company relies on tradition render chain as shown in the Figure 4 below. In traditional supply chain (figure 4), we witness that recording companies make huge tax and thus the profits from the two elements (in blue boxes).However, this model soon changes considering technology advancement in music like MP3 that immediately spawned illegal peer-to-peer music download over the net income. Concerning the issue, coupled with wide coverage of high-speed Internet access, recording labels realize th at they should change their supply chain to adopt the advancement in information technology as described in the following section. However due to the benefit that digital distribution provides, the company also offers the digital option for the supply chain (Figure 5).By developing the digital distribution, the company starts receiving significant growth on digital revenues. In 2006, digital revenue contributed about 8. 5% of total Group revenues. In addition, digital revenues also experienced significant growth by 78. 2% in 2006, providing more opportunity to receive more revenue from this technology (EMI Group, 2006). In this web-based supply chain model, we witness that recording labels are massively countenance licensing strategy that significantly fire up a legal digital music subscription (in contrast to Napster that was illegal). 7.Key resources and capabilities of EMI in the last Five years and Suitability, Feasibility, and Acceptability Concepts There are several key adva ntages and resources the company possess indoors the past five years. First is EMI Music keep finding new talents that bear success in UK and North America, in particular, and in the world, in general including Letoya, 30 Seconds to Mars. This strategy represents the feasibility of strategy taken by EMI Group since competitions between recording industries is mainly regarding the artists that the company manages their music creation.Second is the success of current managed artists including popular artist such as All Saints, Keith Urban, Norah Jones, Robbie Williams, and Depeche Mode. This artist management represents the suitability to manage the popular artists and renounce the unpopular one. Meanwhile, EMI Music Publishing successfully finds songwriting talent that way out in the attractive performance revenues that represents the acceptability (EMI Group, 2006) 8. Conclusion In the basic marketing management study, four factors characterize the successful marketing they are product, place, promotion, and price.In the recording industry while product represented by the artists, distribution or place factor also provides significant contribution to the company. This is in line with OBrien and Springman (2004) suggestion that say companies should balance supply and consider since focusing entirely on the supply side may result in unnecessary capital expenditures, inventory investments or suboptimal solutions. Concerning the challenges in the music and recording industry, this paper has discussed about Emi Group plc, a giant in music and recording industry.In particular, there are several issues including the credit of strategic choices that EMI performs, EMI and its critical success factors in competing in the industry within the last five years, and the use of appropriate management concepts in evaluating the suitability of EMIs current strategies to deal with future competition.ReferenceCarlson, Scott. (2001). Napter Was Just the offset printing of the Bandwidth Invasion. 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