The definition¹ of the phrase “record label” is simple: “a company that produces and sells records, CDs, and recordings.” Adding the word “major” to that is pretty self-explanatory. Explaining in greater detail what exactly one of these companies, let alone one of the biggest examples of one does, is not.

At its most basic, major record labels find Singers and musicians, sign them to exclusive contracts, and release the music they create in order to make both the company and the artists money. Of course, doing so successfully involves a lot of people with different jobs, and the largest firms can have thousands of employees worldwide.

Major record labels are always on the hunt for rising talents, and while they used to search for them in small nightclubs, these days many new signees are discovered on social media or on platforms like Spotify, Apple Music, or YouTube, where anyone who is going viral with a clip or a song instantly becomes a must-have for the biggest players in the space.

After a contract is signed, major record labels can help pair musicians with Producers, Writers, Engineers and Mixers, all of whom come together to create songs and albums. The company then creates promotion plans, distributes the music via digital platforms (streaming sites and download stores like iTunes) and manufactures CDs and vinyl, then ships them out to stores.

Major record labels can then help promote the music, via traditional publicity routes (magazines, blogs, TV, advertising), radio, and marketing (which can involve everything from the cover art to selling the tunes themselves). They also help develop musicians, both new and established, helping them find new sounds and creative outlets.

It’s worth noting that while major record labels will have their hand in all of these activities for all of their artists, the company itself doesn’t always do them. For example, the major record labels have publicity and radio divisions, but that doesn’t mean they work every project themselves. Sometimes the Managers of artists and bands will work out a deal to do PR/marketing/radio themselves or perhaps hire another outside firm.

Major record labels also focus on publishing and licensing of the music they own the rights to, helping supply songs for film, TV, advertisements, and so on.

Now that we’ve discussed what major record labels are, what they do, and why you may want to be signed to one, it’s time we took a look at the companies themselves.

There are only a handful of top competitors in the music industry, and they claim the vast majority of well-known musicians and groups, as well as countless subsidiary labels with even more signees.

It’s easy to get to know the three largest names, and then it gets a bit more confusing from there, but a basic understanding of the most important brands is important, whether you desire to be a part of them or not.

The 3 major record labels are:

• Universal Music Group
• Sony Music
• Warner Music Group

Year Founded: 1934
Headquarters: Santa Monica, CA
Annual Revenue: $7.7 billion² (2019)
Market Share: 54.5% (2019)
Subsidiary Labels: Interscope Geffen A&M, Capitol, Island, Republic, Def Jam
Artists: 5 Seconds of Summer, Blackpink, DaBaby, Dr. Dre, Eminem, Selena Gomez, Imagine Dragons, Lady Gaga, J. Cole, Kendrick Lamar, Maroon 5, U2, The Rolling Stones, Beck, Halsey, Katy Perry, Drake, Post Malone, Ariana Grande, Taylor Swift, etc.

The largest of the three major record labels by a very sizable margin, Universal Music Group also claims the largest roster of musicians across its many, many subsidiary labels (which could number into the triple digits). The company incredibly employs more than 8,000 people and has offices in dozens of countries. Amazingly, Universal Music Group itself is owned by even larger firms, with Vivendi and Tencent each owning part of the brand.

In recent years, the giant has worked hard to keep up with the changing music industry, putting digital and streaming first and looking for new revenue streams with its vast library of musicians, songs, and albums. In doing so, UMG has been praised by countless publications as “forward-thinking.”

Universal Music Group

Year Founded: 1929
Headquarters: New York City, NY
Annual Revenue: $4.51 billion³ (2020)
Market Share: 23.4% (2019)
Subsidiary Labels: Columbia, Epic, RCA, Sony Music Nashville, Sony Masterworks, Legacy, The Orchard/RED Music
Artists: Adele, AC/DC, Barbra Streisand, Billy Joel, Bob Dylan, Beyonce, Bruce Springsteen, Daft Punk, Travis Scott, Mariah Carey, OutKast, Alicia Keys, Britney Spears, Justin Timberlake, Kesha, Pink, Miley Cyrus, Usher, Tool, Luke Combs

The second-largest of the big three major record labels, Sony Music also owns Sony/ATV, which is the largest music publisher in the entire world, so the company does win in another respect. The label (and its many subsidiaries, which could be as many as 100 different brands) may bring in billions, but it is still just one piece of the Sony empire, which touches every form of entertainment.

Sony Music

Year Founded: 1958
Headquarters: New York City, NY
Annual Revenue: $4.4 billion⁴ (2020)
Market Share: 12.1% (2019)
Subsidiary Labels: Elektra, Warner, Parlophone, Atlantic, Rhino Entertainment, Alternative Distribution Alliance
Artists: ABBA, Aretha Franklin, Bruno Mars, Cardi B, Coldplay, Ed Sheeran, Kelly Clarkson, Lizzo, Lil Uzi Vert, Meek Mill, David Guetta, Dua Lipa, Linkin Park, Neil Young, Alanis Morissette, Fleetwood Mac, Frank Sinatra, Green Day, Madonna, Metallica

The youngest of the three major record labels by several decades, it’s not shocking that Warner Music Group also claims the smallest market share. Less than twenty years ago, the company differentiated itself from its competitors by going public on the stock market, and for a number of years, shares were traded.

It was then purchased entirely by Access Industries, which chose to make it public once again in 2020. The company, which was once part of the entire Warner conglomerate but which now stands on its own, moved into online media a few years back, expanding its revenue streams.

Warner Music Group

Many rising musicians dream of being signed to famous record labels, and for good reason! It’s an understandable goal. Here’s what being signed to a major means.

Perhaps the biggest pro to signing to a major record label is the fact that those few companies are responsible for creating almost all the biggest musical stars in the world. For many decades, the only real way to become a household name by playing music was to sign to a major label, and while that isn’t necessarily entirely true anymore…the same idea still holds.

Making a living as an artist continues to be notoriously difficult, and becoming the kind of musician whose music is all over the Billboard charts, who tours the world, who wins a Grammy and who eventually becomes known the world over all but requires a major label.

There are a handful of examples of people who have been able to make it work with the rise of social media and streaming platforms, but the chances are still very, very small that such a fate is in the future for any band or solo act not signed to one of the biggest labels looking for artists.

Major record labels have the connections, the know-how, the talented staff, and perhaps most importantly, the money to turn an unknown talent into a star.

Beltran said once you get signed, that’s not the pinnacle of your career, that’s the beginning.

“We always say, once you’re signed, that’s when the real work happens,” he said.

“Everybody puts so much emphasis on getting signed. They’re like, ‘Oh, I’ve made it,’ and no, no you haven’t made it yet. There’s so much work going into being signed and after the fact of being signed. You can’t expect a record company to come in and wave a magic wand and turn you into the next pop star. It just doesn’t happen that way.”

The work involves doing what has been working for the artist, just on a larger scale with a bigger budget. And also, getting rid of what hasn’t been working.

“You have to remember that the artist did something right to get signed,” Beltran said. “Don’t underestimate that; what has worked, has worked to a point and caught the attention of a record company. At that point, an artist should have fans.”

Getting signed to a major record label is one way to make a career as an artist, but it’s not the only way. It’s actually becoming less popular, according to Beltran.

“Now, more and more artists are doing it without the labels,” he said. “The artist and their team are the ones doing the development side of things. …An artist just getting the right attention from the consumer directly: that’s the model that’s been built in the last ten to fifteen years.”

The way you get the right attention from the right fans is to focus on your relationship with your audience, Beltran said.

“…Embrace your audience and cater to them,” he said. “I think a lot of artists find it difficult to understand how important they are to their fanbase. Or because it’s not a large number, they overlook it.”

So if you do this right, you’ll grow your audience. And at some point, you can catch the attention of a label, which means they’ll want to talk with you. And with social media, this growth can happen in a very short period of time, said Mundle.

“Anything can just go up in streams within a day, within a few hours,” he said. “Every label is looking at the same thing. A lot of labels are either looking at the same thing on a competitive route or looking at things that they can actually bring in and do artist development with.”

Because things move so fast and because more artists opt to stay independent, this makes it more competitive among labels.

“A lot of the time now, artists want ownership, and some artists don’t even want to go to a label so soon,” Mundle said. “They might want to be indie and “run their plays up,” as they like to say, and then come to a label. When other labels get into the conversation, the value goes up, extremely.”