Is the Music Industry dying? Not so fast(or at all)

[Sir Terrence the Terrible]

There has been a lot of things said about the music industry(some true, some not so much), but the most prominent message I have heard is the music industry is dying a slow and painful death. Unfortunately only one metric has been used to come to the conclusion, and that is CD sales. Using that one metric is very deceiving when there are multiple delivery systems for music. So let's look at a few things that disputes the music industry's death. According to NDP;

Album sales for 2011 were up 1.3%, the first sales uptick since 2005. 66% of those sales were CD's.

There were 250 million albums sold in 2011. I am not talking about individual songs of an album, but whole albums. This is for the US ONLY.

75% of album sales were done at brick and motar sites.

40% of CD sales went to folks 40 y/o and over. These are the folks that grew up on CD's. Surprisingly 60% of CD sales went to 40 y/o and younger, a demographic that is usually associated with single song purchases on Itunes.

Vinyl sales increased 37 percent in 2011, but only accounted for 1.2 percent of all physical sales.

Digital country music sales are up 31% over 2010. Country music fans were slow to get into digital sales, and country music labels have been pretty slow at getting into the digital sales.

While the music industry is far from dying, it is certainly changing and diversifying. Rather than looking at one metric or delivery system, you really must combine all the revenue streams together. When you combine music streaming, digital and physical sales, licensing, and re-transmission, the music industry is not only healthy, but doing quite well.

On the other side of the coin, music production really has changed quite a bit over the last decade. Large music industry studios that used to handle the bulk of production in the 80's and 90's are now giving way to home studios and smaller boutique recording and mastering facilities(like mine) which are now doing the bulk of the work. While my own studio is mainly a movie and television post production facility, mixing and mastering for audio only formats have jumped about 40% in the last year or so. Studio equipment has gotten better, more sophisticated, better sounding, cheaper, and easier to work with than in the past.

One thing that is certain, the reports of the death of the music industry are not only inaccurate, incomplete, but exaggerated as well.

[E-Stat]

but the most prominent message I have heard is the music industry is dying a slow and painful death.
To this old guy, I think music and audio is in a golden age of diversity and accessibility. I've found a lot of new music through XM and internet radio. Found complete digital recordings of rare vinyl albums acquired decades ago over the 'net. Sure, there are many overly knob twiddled and compressed recordings, but that has been driven by the market. Good stuff certainly exists. Today, I received a couple of albums ordered from Amazon a few days ago. One new, one used, but immaculate. Ripped and copied to music server - listening now. Will add to iPhone library tomorrow.

I'll echo your thoughts about the lowered cost of really decent gear. And diversity has never been greater. You can find an incredibly wide range of SS and tube gear alike. Speaker designs? All of the them. Whatever floats your boat and budget.

[RGA]

Well as someone who just bought a new CD player - this is very nice to read.

Interestingly the U.S importer says that his dealers have not asked for CD players because audiophiles are not buying. Perhaps they are being misled by the false news reports of the CD demise.

If you have a linked for this information - I would like to post it on Audioasylum since that where most of the audiophiles hang out - nothing against this forum - but there are simply far far more posters over there who probably need this information.

Or you could post this on the General forum there yourself if you don't have a link.

[LeRoy]

@Sir T, great post! "40% of CD sales went to folks 40 y/o and over." Man, that is right for me...just this year alone I have purchased approximately 20 new CD's and some of the music I had never even heard before. I am waiting for another shipment of new music to arrive this Friday! I think the large established studios may be hurting due to new competition..I agree with your statement that death of the music industry is exaggerated.

@E-Stat- "To this old guy, I think music and audio is in a golden age of diversity and accessibility." Ya, my music collection as it now exists is the most diverse ever...New Age, Acoustic Jazz, Smooth Jazz, and a little bit of C&W and Bluegrass. I can't hardly wait to build a collection of Mississippi Delta Blues music and some Chamber music too. Oh, I might as wlll have some Rhianna while I am at it! lol

[Worf101]

At lot of the doom and gloom that was perpetrated about the record industry actually came FROM the industry. Music distribution is a vastly different animal than what it was 10 years ago. Go back even farther and the current situation borders on Science Fiction. All record company execs, like all industry execs, compare current business and business models to what was going on in their youth, the "golden age" of Top 40. Back then you could still lose money but you almost had to work at it.

Back then artists were signed to contracts that amounted to virtual slavery. Management held all the cards, had all the power and made insane amounts of money in an enviroment where the only way they could "lose" a sale was if someone had a reel to reel. As portable recordable media formats were born and grew, the golden age slipped into the silver age. In this time Record Company's were bought out by multinational companies (like Sony) who made tons of money by simply re-issuing old content in a new format, CDs. In this period profits were obscene., and companies became even more bloated and calcified.

Nothing is sadder than an industry or company that refuses or simply cannot get out of the way of the speeding train. I just watched this first hand with the demise of Kodak in Rochester. Couldn't adapt, or get out of the way and they're now gone. I'm sure that record company files are replete with memo's from young middle managers who warned their superiors that changes in way music is recorded and SHARED was going to threaten the golden goose. But the industry didn't listen or couldn't listen. And soooooo they watched as sales dropped, profits declined and worse yet, new artists were using the internet to "sieze the means of production." Making, distributing and SELLING music directly to the public WITHOUT the help or permission of a label. Blasphemy!!!!

While they've taken many body blows, the record companies are'nt completely dead, but they will never see the genie back in the bottle. They can make some money, just not the money they used to make with the control they used to have. Those days are done for good. and its time they stopped suing housewives and crying about it.

Worf

[bobsticks]

While the music industry is far from dying, it is certainly changing and diversifying. Rather than looking at one metric or delivery system, you really must combine all the revenue streams together. When you combine music streaming, digital and physical sales, licensing, and re-transmission, the music industry is not only healthy, but doing quite well.

On the other side of the coin, music production really has changed quite a bit over the last decade. Large music industry studios that used to handle the bulk of production in the 80's and 90's are now giving way to home studios and smaller boutique recording and mastering facilities(like mine) which are now doing the bulk of the work. While my own studio is mainly a movie and television post production facility, mixing and mastering for audio only formats have jumped about 40% in the last year or so. Studio equipment has gotten better, more sophisticated, better sounding, cheaper, and easier to work with than in the past.

One thing that is certain, the reports of the death of the music industry are not only inaccurate, incomplete, but exaggerated as well.



To this old guy, I think music and audio is in a golden age of diversity and accessibility. I've found a lot of new music through XM and internet radio.

Yup and yup. It's all out there one just has to reach out and grab it in a different way. I suspect fthat for the artists it's easier to make a living and harder to get rich than in the previous business model. It's probably a lot easier to avoid being butt-plunged as in year past as well...a direct consequence of nefarious behaviour on the part of the fixers and the suits...

[Sir Terrence the Terrible]

At lot of the doom and gloom that was perpetrated about the record industry actually came FROM the industry. Music distribution is a vastly different animal than what it was 10 years ago. Go back even farther and the current situation borders on Science Fiction. All record company execs, like all industry execs, compare current business and business models to what was going on in their youth, the "golden age" of Top 40. Back then you could still lose money but you almost had to work at it.

Back then artists were signed to contracts that amounted to virtual slavery. Management held all the cards, had all the power and made insane amounts of money in an enviroment where the only way they could "lose" a sale was if someone had a reel to reel. As portable recordable media formats were born and grew, the golden age slipped into the silver age. In this time Record Company's were bought out by multinational companies (like Sony) who made tons of money by simply re-issuing old content in a new format, CDs. In this period profits were obscene., and companies became even more bloated and calcified.

Nothing is sadder than an industry or company that refuses or simply cannot get out of the way of the speeding train. I just watched this first hand with the demise of Kodak in Rochester. Couldn't adapt, or get out of the way and they're now gone. I'm sure that record company files are replete with memo's from young middle managers who warned their superiors that changes in way music is recorded and SHARED was going to threaten the golden goose. But the industry didn't listen or couldn't listen. And soooooo they watched as sales dropped, profits declined and worse yet, new artists were using the internet to "sieze the means of production." Making, distributing and SELLING music directly to the public WITHOUT the help or permission of a label. Blasphemy!!!!

While they've taken many body blows, the record companies are'nt completely dead, but they will never see the genie back in the bottle. They can make some money, just not the money they used to make with the control they used to have. Those days are done for good. and its time they stopped suing housewives and crying about it.

Worf

Worf,
They are making MORE money than they used to because they have more outlets to release music that is well past its prime on physical media. They have albums that are no longer selling on CD, but now license it to music streaming sites.

They can now sell the CD, license individual songs over multiple platforms, and get re-transmission and royalties fee's. So instead of making money off the CD alone, they can take a single product and make money several times over on multiple platforms. And the record companies can do this with fewer employee's which lowers overhead.