Competitiveness in the Music Industry : A study of the Swedish Music Companies

by Sörendal, Fredrik; Berg, Anders; Fransson, Jörgen

Problem: Purpose: Method: Result: The music industry has experienced a significant technological change, leaving the music companies with a new way of distributing music. The sale of physical products (i.e. the CD) has decreased, and the industry has seen a steady increase in digital music. In this period of technological change, how are the four major music companies, EMI, SonyBMG, Warner Music Group and Universal Music to create a competitive advantage? The purpose of this thesis is to study and analyze how the traditional music companies are creating a sustainable competitive advantage in a technologically changing environment. A qualitative approach, following the logic of a case study, has been used to answer the purpose. Interviews with new media managers at the four major music companies have been conducted. Furthermore, an interview with the mobile phone operator 3 was conducted since the company is one of the biggest customers to the music companies using the new technology. In order to avoid a biased study, we also interviewed Robert Picard at JIBS and Kris Serian at Warner Home Video who both have extensive experience in the media industry. In this thesis we have arrived at the conclusion that the music companies have been slow to adapt to the technological change and that new more entrepreneurial entrants are the ones taking advantage of the new technology, not the established players. Moreover, we have found that none of the music companies possess a sustained competitive advantage. The study rather shows that the source of competitive advantage solely comes from the artists they sign. ii