Tower Records In Bankruptcy Again

[Woochifer]

Personally, I think this is very sad news as it reflects how the music industry is increasing shifting to big box merchants and online distribution. Tower Records has been an industry icon for decades, pioneering the concept of going deep catalog on selection. At one point in time, their landmark Hollywood store tried to keep as many titles in stock as they could hold, and was supposedly the world record holder for number of titles stocked at a single location.

As a teenager before I got my driver's license, I used to ride the bus for an hour each way about once every two weeks so I could shop at Tower, despite other music stores being within easy bike-riding distance of my parents' house. I simply wanted to spend a whole afternoon perusing through Tower's much bigger selection, looking for interesting new music outside of the top 40. And a lot of the music I was interested in simply wasn't available at my neighborhood music stores. And Tower was where I discovered half-speed mastered audiophile vinyl, alternate imported versions of favorite albums, and where I still go if I'm trying to find a specific SACD title.

Sadly, many of Tower's flagship stores have been overshadowed in recent years, most notably by the Virgin Megastores, and Amoeba Music in SF and LA. But, in many outlying areas, their stores remain the only place within an easy drive that goes deep into the music catalog. Big box stores like Best Buy, Circuit City, Borders, Wal-Mart, and Target have eaten into the standalone music stores by offering lower prices on the big sellers, while stocking nowhere near the same number of titles as Tower.

In outlying communities like Stockton and Fresno here in California, Tower is the only place within at least a two-hour drive that has a decent selection of less mainstream music and classical titles. Indeed, people in those areas can now order online, but there's still something to be said for the ritual of going into a music store and discovering all sorts of new music by simply flipping through the bins and listening in the demo booths. Tower also locates in the suburbs, whereas Virgin typically opts for a more high profile location.

Tower had already filed for bankruptcy in 2004, and used that filing to restructure their costs and close some of their unprofitable stores (most notably their college town flagship stores in Berkeley and Austin, which were more impacted by downloading), emerging out of Chapter 11 a few months later.

This time it looks like the bankruptcy court will decide on who winds up with Tower's assets. A worst case scenario would be someone using the brand for an online venture, and liquidating the stores. Supposely 76 out of Tower's 89 locations are profitable, so that would be a shame if the buyer decides that only the brand is worth anything and decides to close all of the stores. Bidders include Trans World Entertainment (which specializes in buying distressed music chains like Musicland, Sam Goody, FYE, and Wherehouse; they currently control about half of the music chain stores in the U.S.), a Chicago real estate developer (perhaps so they can redevelop Tower's valuable property in SF's expensive North Beach and Castro neighborhoods, and on the Sunset Strip in Hollywood?), and Tower's founder Russ Solomon.

http://news.yahoo.com/s/nm/20060822/media_nm/tower_dc_1

[paul_pci]

That is a damn shame. I really like Tower. Although they don't tend to have discounted CDs, I have found quite a lot of discounted Music DVDs. I try and go when I can. There's one in Northridge and in the Sherman Oaks galleria I go to. The galleria one is nice: two stories, massive collection in all CDs, DVDs, Music DVDs, and last time I looked even a respectable DVD-A/SACD selection for a mainstream retail outlet. I also get a kick out of all their "toys." Like with Good Guys, I'd really miss Tower.

[shokhead]

Reg prices are high but a great selection and they do have nice priced and selection of music DVD's. The Warehouse is the one that needs to go away.

[Woochifer]

That is a damn shame. I really like Tower. Although they don't tend to have discounted CDs, I have found quite a lot of discounted Music DVDs. I try and go when I can. There's one in Northridge and in the Sherman Oaks galleria I go to. The galleria one is nice: two stories, massive collection in all CDs, DVDs, Music DVDs, and last time I looked even a respectable DVD-A/SACD selection for a mainstream retail outlet. I also get a kick out of all their "toys." Like with Good Guys, I'd really miss Tower.

Whenever I was in the Valley, I used go to the old Sherman Oaks location along Ventura Blvd. I also remember their Panorama City location along Van Nuys Blvd. -- not surprised that it shut down because there were hardly any customers in there whenever I passed by. When that Northridge store first opened, I would venture out there as well because Tower had a month-long grand opening sale -- one of the few occasions where Tower would discount everything in the store. Their prices are high, but their stores are always well organized and well stocked -- much easier to find stuff at Tower than at other stores.

One of the casualties of Tower's previous bankruptcy was their extended hours. Their stores used to all stay open 9am-midnight every day of the year, but that's now gone away with only a few even staying open until midnight on weekends. I miss the days when I could just walk into any Tower at 11:50pm after a night out and pick out some tunes to listen to when I got home. Another casualty was most of their video rentals. Compared to Blockbuster and Hollywood, Tower Video had a far more interesting selection of movies to pick from.

I'll admit that I've contributed to Tower's demise as nowadays I do most of my music shopping at Amoeba Music and Rasputin's because they also stock used CDs.


Reg prices are high but a great selection and they do have nice priced and selection of music DVD's. The Warehouse is the one that needs to go away.

Unfortunately, Wherehouse's parent company, Trans World Entertainment, is one of the bidders for Tower's assets. That company already controls half of the chain music stores in the U.S., and adding Tower to the mix would just add to their market share. They bought Musicland/Sam Goody from Best Buy a couple of years ago and picked up Wherehouse Entertainment in a bankruptcy sale, after which they shut down most of those stores. It seems that the stores that TWE operates are mall-based and have high prices, mediocre selection, and disorganized stores -- a far cry from how Tower operates its stores.

It would be sad to see Tower become a clone of the FYE stores that Trans World operates at several malls, or to have the Tower name diluted by slapping it on all these smaller mall stores. Of course, it would be even sadder to see Tower's stores go away altogether. Places like the Tower district in Sacramento (where the original store still stands), the Sunset Strip, North Beach and the Castro in San Francisco, etc. would not be the same.

Music stores as a whole seem to be on life support. The neighborhood music store is rapidly becoming just as rare as a neighborhood movie theater. In 1990, there were around 9,000 chain music stores, and that number has now dwindled down to around 2,000.

[emaidel]

I too feel this is a terrible shame. In the Denver metro area, there is only one Tower store, and for those of us (like myself) who are great fans of classical music, the Tower store was the only place to go. Borders, Best Buy and Circuit City all sell CD's, but if anyone's interested in classical music, looking through their pitiful selections is an exercise in frustration. Borders' classical selection once was pretty good, but it seems as if they're just letting it dwindle away as the remaining discs are purchased. The other two (Circuit City and Best Buy) have such awful , and tiny selections, they might just as well be nonexistant.

[jrhymeammo]

That is a sad news. But I must say, shame on them for not foreseeing the outcome. These companies had almost a decade to prepare for the day. Do I have a better idea? Nope, am not a CEO of music retailer biz just a typical college student. But I cannot help to think CEOs and top managements didnt conduct well thoughtout strategic management.
I really hope they didnt think they could compete by just selling DVDs CDs and magazines. What made them special to begin with? Selections? Please, that was special 15+ years ago.
But yes, classical section was REALLY nice.

I too feel this is a terrible shame. In the Denver metro area, there is only one Tower store, and for those of us (like myself) who are great fans of classical music, the Tower store was the only place to go. Borders, Best Buy and Circuit City all sell CD's, but if anyone's interested in classical music, looking through their pitiful selections is an exercise in frustration. Borders' classical selection once was pretty good, but it seems as if they're just letting it dwindle away as the remaining discs are purchased. The other two (Circuit City and Best Buy) have such awful , and tiny selections, they might just as well be nonexistant.

Hey there neighbor.
Have you considered Independent Records on Colfax, Twist and Shout on Alameda, and Second Spin on Colorado Ave? If you can tolerate those young punks living so-called "alternative lifestyle", you can kiss other places goodbye. Virgin MegaStore on 16th street Mall might be your best bet, but they operate like we all have bank accounts of RockStars. Fcuk them, I never want anything to do wit'em. But, it's always a nice place to cool off walking home from UCD during summer seasons.
Wax Trax is a joke for Classical music on CDs.

Peace.

[Woochifer]

I too feel this is a terrible shame. In the Denver metro area, there is only one Tower store, and for those of us (like myself) who are great fans of classical music, the Tower store was the only place to go. Borders, Best Buy and Circuit City all sell CD's, but if anyone's interested in classical music, looking through their pitiful selections is an exercise in frustration. Borders' classical selection once was pretty good, but it seems as if they're just letting it dwindle away as the remaining discs are purchased. The other two (Circuit City and Best Buy) have such awful , and tiny selections, they might just as well be nonexistant.

In quite a few towns, Tower is the only store nearby that supports classical music. Virgin does okay, but even huge independent stores in my area like Amoeba Music are very spotty with their classical coverage (lots of used items, but very little in the way of new CDs and LPs). Supposedly, Tower's founder is a huge classical fan and allocates the space for classical titles, despite the fact that they typically sit on the shelves up to four times longer than other genres.

Too bad about Borders. I noticed as well that they have not been as good as before with restocking their classical section. You would think that Bay Area Borders stores would make sure that they had plenty of copies of the SF Symphony's Mahler series in stock, especially during the season with those pieces on the concert schedule, but they didn't. Tower does a good job with organizing their store displays around the Symphony's schedule, especially if it's a piece that the SFS has recorded before. They'll do similar highlighting around other concerts as well.


That is a sad news. But I must say, shame on them for not foreseeing the outcome. These companies had almost a decade to prepare for the day. Do I have a better idea? Nope, am not a CEO of music retailer biz just a typical college student. But I cannot help to think CEOs and top managements didnt conduct well thoughtout strategic management.
I really hope they didnt think they could compete by just selling DVDs CDs and magazines. What made them special to begin with? Selections? Please, that was special 15+ years ago.
But yes, classical section was REALLY nice.

I think a big part of it is that Tower way overextended themselves several years ago, with expensive high profile locations as well overexpanding with smaller stores in suburban areas that did not quite fit the traditional Tower Records deep catalog model. That accumulated debt led to their first bankruptcy. They have tried other ventures, such as video rentals, books, and personal electronics. Their video rentals and book stores in particular were very good, but ultimately not profitable because Tower's not a big enough player in those areas to negotiate the kinds of deals that larger video rental and book store chains could get.

Their whole claim to fame is their title selection. At the time when Tower opened their flagship stores in San Francisco and Los Angeles, no other music retailers went nearly as deep into the available titles as Tower did. They were the trend setters and paved the way for other music superstores.

Here in California, they've been getting outflanked by other music retailers that took their model and updated it. Virgin Megastore is their most serious competitor nationally, focusing on high profile locations, bigger floor space, even more selection than typical Tower stores, and making their stores into posh shopping destinations with stuff like in-store cafes, books, clothing, cell phones, and comfortable listening areas. And they have not made Tower's mistake of overexpanding with a bunch of smaller stores -- all of Virgin's stores are similarly huge. Tower just doesn't generate the same buzz that Virgin does.

And on the other side, Amoeba Music (currently the largest independent music stores in the country) operates three huge utilitarian stores in Berkeley, San Francisco, and Los Angeles. Pretty much all they sell is music, along with a scattering of DVDs -- no books, no magazines, no electronics. They simply took Tower's deep catalog model and went to the extreme with it, and added used CDs and LPs to the mix. Supposedly, it's the used CDs that keep them profitable. There's nothing fancy about their stores, it's all bare bones. But, at any given time, their L.A. store will have around 300,000 titles in stock, and the store is always jam packed. Up the street a couple of miles, Tower's Sunset Strip location doesn't have nearly the same appeal to the serious music buffs as before.

If anything, Amoeba proves that selection still means a lot. Here's an article about the more successful indie music stores from Rolling Stone.

http://www.rollingstone.com/news/story/5936076/indie_chains_are_slump_proof

I think Tower's stores currently lie somewhere between the local mall-based stores and those giant megastores like Virgin and Amoeba. Personally, I like the size of Tower's stores because they carry enough interesting titles without having to spend all day to find a specific CD. Whenever I shop at Amoeba, I often don't find the CD that I was originally looking for, but I'll wind up with 3 or 4 other CDs that I found in the bins.

BTW, here's a picture of the SF Amoeba store -- this only shows about half of the store. I used to live within walking distance of this place!

http://upload.wikimedia.org/wikipedia/en/thumb/2/22/InsideAmoeba.JPG/800px-InsideAmoeba.JPG

Despite Tower's problems, supposedly the majority of their stores operate profitably, so hopefully they can find a way to continue operating.

[paul_pci]

Actually, the Amoeba in Hollywood has a good classical selection. I had to drag my girlfriend outta there so we could make our movie on time, as it's right next to the Cineramadome.

[Woochifer]

Actually, the Amoeba in Hollywood has a good classical selection. I had to drag my girlfriend outta there so we could make our movie on time, as it's right next to the Cineramadome.

On my trips to the L.A. Amoeba store, I've yet to make it as far as the classical section! I usually wind up getting stuck somewhere between the jazz and electronica sections. (Like you, I'm usually popping by right before a movie at Arclight Cinema across the street, so my time to peruse around their 300k titles is a bit limited!) Sounds like the classical section at that store is better stocked than the Berkeley and San Francisco stores. I wonder how it compares with Tower Classical Annex on Sunset, because around here the Tower Classical Annex on Bay Street is more comprehensive than Virgin and Amoeba in that genre.

BTW, here's a list of the classical music selections at various stores throughout the L.A. area, in case you haven't seen it before. I used to go to Record Surplus over on Pico Blvd. to stretch out my music budget when I was a student and whenever I was between jobs.

http://home.earthlink.net/~oy/threat.html

[westcott]

I am not a person to download music because it is very difficult to find full resolution material. There is some, but rarely from the artist I like or the entire album.

I think the retailers are missing this opportunity for those who can actually appreciate the sound quality possible from a CD when compared to MP3 versions.

As said before, this industry has been sliding south for some time and with little response from the industry to change the outcome. The once knowledgeable staff that knew something about music are replaced by two or three part timers who could give a rats ass about music are placed in their stead to eliminate overtime, insurance coverage, vacations, pregnancy leave, and all the other benefits of a full time position.

Retail must change or it will not exist at all. Pull the stupid bean counters and bring back the proprietor based store who cares about the same things the consumer does. I urge everyone to stop doing business with mega chains and seek out the mom and pop shops. You will most likely pay more but you will be doing business with people who honestly care and who will go out of their way to help you find what you want.

P.S. The only Tower Records I know of is in Dallas? Go figure since I live near the 4th largest city in the nation (Houston).

[jrhymeammo]

I am not a person to download music because it is very difficult to find full resolution material. There is some, but rarely from the artist I like or the entire album.

I think the retailers are missing this opportunity for those who can actually appreciate the sound quality possible from a CD when compared to MP3 versions.

As said before, this industry has been sliding south for some...........

Retail must change or it will not exist at all. Pull the stupid bean counters and bring back the proprietor based store who cares.......

I totally agree with you, except I find mom 'n pop stores to offer music at cheaper prices. Has anybody noticed that VirginMSs charges on average of $4-5 more on CDs? That could be another reason why dumb folks are DLing music.
I was talking to this kid at work today, and I accused him of stealing music. He got furious and stated that he has never illegally DLed music in his life. I kept talking to him and found out that he doesnt ever have to buy music, cuz most of his "dumb" friends do..... hmmmmmmm.

-JRA

[Woochifer]

I totally agree with you, except I find mom 'n pop stores to offer music at cheaper prices. Has anybody noticed that VirginMSs charges on average of $4-5 more on CDs? That could be another reason why dumb folks are DLing music.
I was talking to this kid at work today, and I accused him of stealing music. He got furious and stated that he has never illegally DLed music in his life. I kept talking to him and found out that he doesnt ever have to buy music, cuz most of his "dumb" friends do..... hmmmmmmm.

-JRA

Virgin's expensive, but they also carry a lot of things that are very difficult to find elsewhere, especially European imports. I primarily shop at Virgin for electronica and dance music, and discovered a lot of great DJs and compilation series by just perusing through their bins and listening stations (which they have more of than other stores). For more well known and mainstream artists, the prices at Virgin indeed are on the high side, which is why I shop elsewhere for the easier-to-find titles.

I'm not sure if the "mom n pop" vernacular applies much with music stores nowadays. The prominent independent stores in my area like Amoeba and Rasputin can compete with the big chains and discount stores, because they operate like megastores themselves. The biggest difference is with their huge used CD inventory, which is apparently how more indies stay in business because the margin on a used CD can be upwards of 60%. Smaller independent stores that I've seen stay in business by catering to specific niche customers. Those stores that relied on teenagers dropping by to purchase titles from the Billboard Top 200 chart are long gone.

There are plenty of reasons why people download music, but I think the primary reason is price -- "FREE"! And there are secondary reasons as well. Most music that I've downloaded is out of print, so my alternatives are to either hope that I luck out while thumbing through the used music bins or download it. Admittedly, downloading was instant gratification, even if I would prefer to have the out of print titles in my disc collection.

Unfortunately, I think the downloading culture has taken hold with the younger crowd, and your conversation is indicative of the rationalizing that a lot of people have done. Tower closing their stores close to the university campuses in Berkeley and Austin are probably indicative of how much this has taken hold. I think the only way that the music industry can pull out of this downward slide is to find the next great thing in music (hip hop and alternative have gotten very long in the tooth, and nothing new has come along along to supplant them), and to offer more value to those who buy music (examples include the bonus DVDs, exclusive mixes, or online content that are included with some CDs).