The Adaptive Behavior of Music Firms: A Music Industry Feedback Model

Abstract

This article proposes a qualitative system dynamics model which facilitates analysis and understanding of the adaptive behavior of firms in the music recording industry. The model is primarily based on in-depth interviews with decision makers in multinational music firms combined with previous music industry research. In order to test the model, the paper explores aspects of current music industry dynamics and shows how decision makers revise their business strategies in order to adapt to a changing media environment. Based on this analysis, the paper concludes that the music firm’s revised marketing policies have indirectly damaged their talent development capabilities and their long-term ability to survive.