Innovation and Diversity in the Popular Music Industry, 1969 to 1990

This study investigates the organization of the music industry in the United States and its effect on innovation and diversity in American popular music during the 1970s and 1980s. I revise and update Peterson and Berger's (1975) analysis of the popular music industry and observe that, contrary to their assumption that high market concentration leads to homogeneity and standardization in popular music, innovation and diversity in popular music in high market concentration depends on the system of development and production used by major record companies. Major record companies employ an open system of development and production that incorporates innovation and diversity as an effective strategy in maintaining the viability and control of the market. As examples, I discuss new styles of music appearing in the 1980s, radio and music video exposure, and distribution and retailing. I show that the level of innovation and diversity in large culture industries depends more directly on the specific organization of each industry and the structure of its market than on the degree of market concentration.