Update: The Music Industry in 2006

John R. Wells; Elizabeth  Raabe

Case | HBS Case Collection | February 2007

Update: The Music Industry in 2006

by John R. Wells and Elizabeth Raabe

Abstract

The global recorded music industry was undergoing a major transition in 2006. Sales had been declining for a decade, and consumers were buying music in new formats and through different distribution channels. CD sales still accounted for the majority of revenues, but sales of music in digital formats (downloads, videos, ringtones) were growing significantly and accounting for approximately 10% of the industry's revenues in 2006. Many considered digital the future of the music business but the format posed both opportunities and challenges. While it had revitalized the singles market, for instance, digital had also facilitated rampant piracy. The music industry was retaliating, launching lawsuits against illegitimate peer-to-peer operators such as groups caught downloading illegally. Whether this would be enough to stop the trend was a matter of much debate. Meanwhile, the industry continued to consolidate. In 2004, Sony Music and BMG, the third- and fifth-largest record firms at the time, merged to form Sony BMG. Surprisingly, in 2006 the European Union's Court of First Instance annulled the merger--which the European Commission had approved two years earlier--after a group of independent music labels complained about the merger's effect on competition. While Sony and BMG were defending the merger in court, EMI Group plc wondered if its desired takeover of Warner Music Group--which it had been pursuing since 2000--would ever happen. If it did, how much business would the new entity have in the rapidly changing environment? All wondered how the industry would evolve.

Keywords: History; Arts; Music Entertainment; Intellectual Property; Market Timing; Performance Evaluation; Trends; Music Industry;

Format: Print

13 pages

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Citation:

Wells, John R., and Elizabeth Raabe. "Update: The Music Industry in 2006." Harvard Business School Case 707-531, February 2007.

Case | HBS Case Collection | February 2019 (Revised September 2019)

Amazon in Fashion

John R. Wells, Benjamin Weinstock and Gabriel Ellsworth

According to many analysts and industry observers, in 2018 Amazon became the largest retailer of apparel in the United States and the second largest in the world, behind Alibaba. Much of Amazon’s apparel was made by third-party retailers on its platform, but Amazon had been working to build its own fashion retail skills for more than 15 years and had made a number of acquisitions to this end. Having failed to convince leading brands to sell on Amazon, the company had also launched several private-label lines to boost its presence in fashion apparel. However, in 2017, it had finally convinced leading brand Nike to sell direct on its platform. Christine M. Beauchamp (Harvard Business School MBA, 1997), the President of Amazon Fashion since June 2017, was contemplating next steps.
Meanwhile, leading online and fast-fashion specialists such as ASOS in the UK and Inditex in Spain did not appear to have much to be concerned about. However, many traditional fashion retailers, struggling to build effective multi-channel strategies, were facing slow growth and pressure on margins. Would 2018 mark the beginning of the demise of traditional fashion retailing? What role would the bricks-and-mortar channel in fashion retailing play in the future? What might the future look like for the fashion industry? And what role might Amazon play in it?

Keywords: Amazon; Amazon.com; fashion; fashion accessories; retail; Retailing Industry; retailing; ASOS; Inditex; Multi-channel retailers; online retail; online retailing; positioning; private label; delivery; Spending; Online Technology; Competitive Strategy; Fashion Industry; Retail Industry; Apparel and Accessories Industry;

Citation:

Wells, John R., Benjamin Weinstock, and Gabriel Ellsworth. "Amazon in Fashion." Harvard Business School Case 719-481, February 2019. (Revised September 2019.) View Details

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Update: The Music Industry in 2006

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