Highlights

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Music publishing:

1. Profitability declined in the music publishing industry even though revenues increased. Operating revenue increased from $124.3 million in 2006 to $134.5 million in 2007, while operating expenditures rose from $111.8 million in 2006 to $123.0 million in 2007. As a result, the industry operating profit margin dropped from 10.1% in 2006 to 8.6% in 2007.

Sound recording Studios:

1. Sound recording studios, the smallest of the three industries, saw its profit margin increase from 12.5% in 2006 to 15.6% in 2007, as operating revenue rose faster than operating expenditures.

Record production and integrated record production and distribution:

1. Operating revenue for the record production and integrated record production and distribution industry fell from $712.3 million in 2006 to $683.0 million in 2007. However, operating expenses fell even more from $644.4 million in 2006 to $605.2 million in 2007. As a result, operating profit margin rose from 9.5% in 2006 to 11.4% in 2007.
2. Sales of recordings fell 16.7% over the period 2005 to 2007. Most of the decline is due to the 20.0% decrease in sales of recordings by non-Canadian artists. By comparison, sales by Canadian artists declined 3.7%.
3. Sales volumes of compact discs and cassettes tapes fell. However notable increases in other formats such as DVD and digital music sales, which experienced a 4 fold increase between 2005 and 2007, helped offset the decrease in sales volume. Digital music sales include both individual tracks and albums.
4. More music was released in 2007 compared to 2005. The overall number of new releases increased 9.0% to just over 4,478 releases.
5. New releases of musical recordings by Canadian artists with English lyrics increased 1.5% while new releases with French lyrics increased 23.9%. However, a substantial decrease in the number of new releases of other non-lyrical music resulted in total new releases by Canadian artists dropping by 2.2%.
6. New releases with French lyrics by both Canadian and non-Canadian artists had the highest growth rate (18.5%) from 2005 to 2007.
7. Operating revenue for Canadian controlled labels increased by 37.7% whereas operating revenue for foreign-controlled labels decreased by 21.3%.
8. Foreign-controlled firms account for the vast majority (72.0%) of total industry operating revenues.
9. Of the overall Sales of recordings by Canadian artists, Canadian controlled labels account for 64% as compared to 36% for foreign-controlled labels.