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Music Sales

nytimes.com

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Re: Music Sales

#31

Post by dinkumator »

What does 'value of units shipped' mean?? I'd beg the question that all they put out now is crap anyway, so I'd agree that the value is nothing compared to the old days.

I don't think I like that it's in billions of current dollars, seems a little misleading since they didn't actually have $8.1 billion in LP/EP sales in 1978.

Finally, the difference between CD and other digital media versus LPs and cassettes is that they don't wear out. You only have to buy it once, and if a bunch of your friends borrow it its not a big hassle.

Re: Music Sales

#32

Post by Gibbon »

nuweborder wrote: post #12

Unfortunately, no doubt these numbers do not count non-label/unsigned record sales as "thedark" mentioned. This is due to the fact that according to major labels and the FCC, these numbers don't count, simply because they don't receive a cut of those sales. Once we develop a legitimate platform for unsigned musicians to use and compete with the major labels, their artists, and the money they make. Then we will begin…

There is no "dark" market worth mentioning in this context. There are simply no significant sales beyond the major labels and their subsidiaries. The four major labels account for more than 80% of ALL music sold in the USA and the 1600 members of the RIAA account for more than 90%.

The topmost performers in the indie market may achieve some success on their own, as individuals, but in aggregate the total indie market is a disaster.

Re: Music Sales

#33

Post by jrwoodruff »

pyre wrote: post #28
jrwoodruff wrote: post #25

Earlier quoted context omitted.

I don't know if that's entirely true - it's tough to tell without including 'illegal' dowloads in this chart, which is equally difficult to accurately measure against the RIAAs sales data. However, it is very interesting to not how Vinyl, Cassettes and CDs all dovetail into each other nicely. I would be willing to bet that the rise of mp3 downloads and the decline of CDs would dovetail equally as well. The problem wa…

You can't include 'illegal' downloads in there. Something that is free doesn't have the same market pressures as something that costs money. If I download music illegally, I can download GBs upon GBs of music which would cost me thousands of dollars were I to purchase it. What if I don't have those thousands of dollars? It's not like you can say that I would have bought all of those albums if it was impossible to pir…

No doubt. I don't disagree with that, as old as the argument is, but it would be interesting nonetheless to see how the rise of downloads dovetails with the decline of the CD format. If it's an even flow from CD to mp3, as it appeared to be with vinyl>cassette, then cassette>cd, or if it's disproportionate. It would actually go towards supporting or disproving your very argument.

However, I don't think there will ever be any trustworthy comparison like this, as the number of downloaded tracks was never reliably tracked in a manner that would be comparable to the RIAA unit sales data. Even if you could estimate the number of tracks downloaded, it would end up including things the RIAA doesn't include, like mashups, indy tracks, concert bootlegs, simpson quotes, etc.

Re: Music Sales

#34

Post by Gibbon »

dustmop wrote: post #6

Looks to me like CD sales were a bubble, and there's no reason to expect the music industry's success to continue as it has for the prior decade.

There was no bubble.. just a market whose time has come and gone, much like the fabled buggy-whip.

The record industry (as opposed to the music industry) was a 20th century anomaly. Prior to the invention of the gramophone, music was largely a participatory affair.. singing to pass the time while working, to celebrate at a social function, to amuse and entertain friends and family and to pass on folklore from generation to generation.

The record as a social object and the idolatry of the rock star were temporary aberations.

The live performance end of the music industry will likely survive, but once all the big stars of the last few decades die off, even that will likely shrink dramatically in size.

Re: Music Sales

#35

Post by anigbrowl »

antidaily wrote: post #4

So, CDs are still outselling downloadable content by as much as 3-5x?

Another interesting surprise is that CDs are still bringing in close to the gross $ volume of cassettes at their peak. The music industry got fat partly on global sales, but also partly because they were making such a huge margin on CDs, even though they were cheaper and took up less shelf space than records.

When I was a techno DJ I spent a lot of money on both vinyl and CDs in my preferred genre (I was happy to support tiny niche labels), but I bought all my mainstream music on used CDs - they usually played fine and it was a lot cheaper. I would never have done this when vinyl was king and have never bought a cassette, ever.

Re: Music Sales

#36

Post by Gibbon »

3pt14159 wrote: post #15

Gross sales is irrelevant. A download costs virtually nothing. No CD to make, no shipping, no store front, not cover printing. The RIAA is misleading people with these types of numbers, no doubt they have lost money, but really, it isn't as bad as they pretend.

Total manufacturing/distribution costs for a CD are around $2.20 with a wholesale price of $6.50.

The labels still get the $6.50 more or less for a digital album (although that's falling) but they no longer have to worry about manufacturing a portion of their products (CDs are still 80% of the market.. digital is 20%) so at best they knocked off 20% of their manufacturing costs thus far.

So now for an equal numbers of units shipped the total cost is $1.76 per unit.

The labels also have to pay mechanical royalties to the artists.

So prior to the internet: $6.50 x 250,000 units minus royalties would net them around $700,000 gross profit.

But they would have paid $250,000 as an advance to the artists.

Net profit would be something like $450,000 on the initial $250,000 investment plus ongoing manufacturing and marketing costs.

If they hit it big, they get rich, but a dud might be a money loser or at best barely profitable.

The digital sales would boost their net profit by $110,000 for the same number of units sold, all else being equal. They would get a 2.24x return on their investment.

Keep in mind 250,000 units is now pretty good for a successful artist now.. the biggest album last year only sold 2.8 million copies.

Artists don't get the shaft anymore than any other business person does.

Labels are just VC.. they risk investing a small amount of money in a very large number of artists (a few hundred thousand) on a hunch that it might pay off. Most don't work out, but the ones that do make up for the rest.

80% of sales come from 50,000 albums pulled from the entire history of recorded music.. not very good odds.

The real problem is that nobody is buying music anymore. Period. Unit sales are dropping off a cliff.

Re: Music Sales

#38

Post by ars »

anigbrowl wrote: post #35
antidaily wrote: post #4

So, CDs are still outselling downloadable content by as much as 3-5x?

Another interesting surprise is that CDs are still bringing in close to the gross $ volume of cassettes at their peak. The music industry got fat partly on global sales, but also partly because they were making such a huge margin on CDs, even though they were cheaper and took up less shelf space than records. When I was a techno DJ I spent a lot of money on both vinyl and CDs in my preferred genre (I was happy to sup…

> Another interesting surprise is that CDs are still bringing in close to the gross $ volume of cassettes at their peak.

It's not. The graph does not adjust the dollar amounts for inflation. (Or if it does it doesn't say so).

So the tape sales were more than they look.

Re: Music Sales

#39

Post by ilyak »

Gibbon wrote: post #32
nuweborder wrote: post #12

Unfortunately, no doubt these numbers do not count non-label/unsigned record sales as "thedark" mentioned. This is due to the fact that according to major labels and the FCC, these numbers don't count, simply because they don't receive a cut of those sales. Once we develop a legitimate platform for unsigned musicians to use and compete with the major labels, their artists, and the money they make. Then we will begin…

There is no "dark" market worth mentioning in this context. There are simply no significant sales beyond the major labels and their subsidiaries. The four major labels account for more than 80% of ALL music sold in the USA and the 1600 members of the RIAA account for more than 90%. The topmost performers in the indie market may achieve some success on their own, as individuals, but in aggregate the total indie market…

100% - 90% is still 10%.

Saying there's no "dark" market is like saying there are no desktop OSes bare Windows.

But, there is one or two, you know; and it bites.

Re: Music Sales

#40

Post by anigbrowl »

ars wrote: post #38
anigbrowl wrote: post #35

Earlier quoted context omitted.

Another interesting surprise is that CDs are still bringing in close to the gross $ volume of cassettes at their peak. The music industry got fat partly on global sales, but also partly because they were making such a huge margin on CDs, even though they were cheaper and took up less shelf space than records. When I was a techno DJ I spent a lot of money on both vinyl and CDs in my preferred genre (I was happy to sup…

> Another interesting surprise is that CDs are still bringing in close to the gross $ volume of cassettes at their peak. It's not. The graph does not adjust the dollar amounts for inflation. (Or if it does it doesn't say so). So the tape sales were more than they look.

Yes it does. I made the same mistake, but read the title: 'value of units shipped for 1973 to 2008, in billions of current dollars'.
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