The Dynamics of Product Differentiation in the British Record Industry
AbstractThe paper conducts a statistical analysis of the dynamics of new music (product differentiation innovation) in the record industry. In pursuing this goal the paper generates new data and analyses a previously unutilized data set. The paper finds that there is a strong correlation between new music innovation in the audio singles and albums market. This is found to be mainly concurrent in the same quarter and to have a reasonably short product life. The paper discovers that these features also characterise the dynamics of record company performance. The research indicates that record companies are willing to sell singles at a loss due to advertising rather than learning externalities. At the industry level, the paper finds that new music innovation does not affect market size significantly and mainly causes the transfer of sales between record companies, with exceptional cases of multiplier effects.
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Bibliographic InfoPaper provided by Trinity College Dublin, Department of Economics in its series Economics Technical Papers with number 951.
Date of creation: 1995
Date of revision:
Other versions of this item:
- Andrew Burke, 1996. "The dynamics of product differentiation in the British record industry," Journal of Cultural Economics, Springer, vol. 20(2), pages 145-164, June.
- L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
- L30 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - General
- M13 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - New Firms; Startups
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