As of the first half of 2003, Universal Music Group (UMG), the world's largest recording company, is a part of the troubled Vivendi Universal conglomerate. The company is the market leader in the recording industry, which is in the third year of a severe downturn by 2003. UMG and its competitors must contend with challenges presented by free online distribution services (such as the late Napster and popular Kazaa) and other technological shocks. This case examines the structure of the recording industry and uses the perspectives of UMG executives as well as a talent manager to explore the challenges and opportunities facing UMG and the recording industry.
