Digital Music Success in China: Suggested Guidelines for Foreign Firms

In this scholarly note, nine guidelines are recommended to foreign rms seeking to sell digital music in China as rms attempt to access one of the fastest-growing and most signicant country markets for entertainment product sales in the world. A complementary piece is Jessica Gisclair’s “The Dissonance between Culture and Intellectual Property in China” (pp. 182–87). Digital Music in China: Nine Suggestions for Foreign Firms China holds enormous potential for the nascent but rapidly developing digital-music industry. According to the International Federation of the Phonographic Industry, China is the world’s twenty-seventh largest music market, with total retail sales in 2006 of US $121.2 million (Butler 2007). China’s share of the world market is likely to continue to increase due to the growing middle class with increasing discretionary income. As economic history has shown, consumers become no longer satised with purchasing only necessities as income levels rise, so spending on various forms of entertainment—including music—will grow. Consequently, foreign record companies are understandably eager to sell recorded music in such a large market that until recently was largely closed off. If a foreign rm is to reach this large and growing market, the following nine guidelines should be helpful in designing a successful strategy to sell digital music in China.