46 new of 55 responses total.
Another way to read that is: Universal Music executive believes Universal Music should get $90 per MP3 playback device sold. Actually, I'd probably be glad to pay $5 / month for an all-you- can-eat music service with decent selection. But players that cost ~50% more in the store shelf are going to be at a substantial competitive disadvantage.
Well, Universal is trying to work out a deal with the other majors, so Universal wouldn't pocket the whole $90. As numerous other commentators noted, this would seem to leave indie labels getting, at best, table scraps.
Would the device then self-disable after 18 months, becoming an expensive paperweight? I keep my MP3 players a lot longer than a year and a half.
uhllucky
Three reports -- one financial analyst and two bloggy anecdotes --
which suggest that it's just about Game Over for the big recorded
music companies.
#1) Bob Lefsetz reports on a recent investment analysis report on
Warner Music from Pali Research. Lefsetz quotes from the report:
> No matter how many people the RIAA sues, no matter how many times
> music executives. point to the growth of digital music, we believe an
> increasing majority of worldwide consumers SIMPLY VIEW RECORDED MUSIC
> AS 'FREE'. ((emphasis KRJ))
> A new model for music consumption must emerge and that model
> most likely involves DRM-free downloadable music at no cost to consumers,
> fully-supported by advertising (within some form of social networking
> environment that enables consumers to discover/explore music).
> The music industry is not ready to endorse such a move at this point
> and even if it was, the economic model transition will be incredibly
> painful.
...
> Artists make the vast majority of their money on touring and
> merchandise, not CDs. In turn, it is increasingly logical to believe
> that artists want to have their music reach the widest possible
> audience at the lowest possible price.meaning FREE. Yet that puts
> the music labels in a very difficult position as their recorded music
> divisions make virtually all their money off of the sale of music.
> Music labels need to get significantly smaller as the industry shrinks...
The recommendation is to sell Warner Music stock.
http://lefsetz.com/wordpress/index.php/archives/2007/11/02/the-greenfield-r
eport/
The full Pali Research report is available behind a free registration wall.
-----
#2) Bloggy report from one Jason Mendelson, who comes back to
U. Michigan annually as a guest lecturer in economics.
Mendelson reports on his unscientific poll of about 300 UMich
students:
> 4. I asked how many of them "bought music legally".
> No more that 15-20% indicated that they bought music legally.
> 5. I asked how many of them "stole music". 100%.
> And all but a couple indicated that a majority of their
> music was stolen.
> 6. Biggest concern of stealing music was not getting caught,
> it was that they "felt badly" for stealing it.
> 7. Almost no one buys CDs, but those that do are all into classic rock
> and jazz (Led Zeppelin, Lynyrd Skynyrd, AC/DC). ...
http://www.feld.com/blog/archives/2007/10/undergraduate_v.html
-----
#3) And finally: Andrew Dubber reports from a UK music trade
industry panel, where six teenaged girls were invited to
discuss their consumption patterns in a market research inquiry.
What really frightened the music biz people was not that the girls
download music for free: they download for free, listen for a while,
and then throw the copies away. Recorded Music, for this unscientific
sample of young people, has become completely disposable. How can the
record biz hope to charge much money when the product has the lifespan of
newspaper?
But my point here was that one member of the old-line music industry
tried to put the fear of God and Lawsuits into the girls:
> "So, let's say one of your friends is caught downloading music.
> And let's say they and their parents go to court. And they're found
> guilty of breaking the law (which is what you're doing). And they have
> to pay thousands and thousands of pounds, and so they have to sell
> house. And they lose everything. Everything. They're poor, and they're
> miserable. Would that make you act differently and pay for music?"
> Translation: if we're really big and scary, sue everyone, make
> examples of your friends and ruin people's lives, will you then finally
> behave in the way we want you to?
...
> Their response was interesting: THEY LAUGHED AT HIM. Honestly. They laughed.
(( emphasis krj ))
http://newmusicstrategies.com/2007/11/03/hooray-for-the-music-biz/
(I recommend this blog for those interested in following the Music Wars.)
Your comment about touring being the big profit center is interesting in light of Madonna's new deal with Live Nation. The label she dumped? Warner Bros.
re resp:14: Haven't teenagers been buying music, listening for a while, and then throwing it away (or storing it away and not paying attention to it for a long time) for decades? If they were listening to last year's music, they wouldn't be buying new music. I see no reason why this would be expected to change just because they are downloading it for free. Maybe the music is a little more disposable when they're not buying CDs for $18 each. If this "frightened" music execs, then I'd say they're not too well balanced. I would guess it couldn't have surprised any of them, even by the slightest amount.
http://www.ted.com/talks/view/id/187 This talk by Larry Lessig is a great description of the differences between creativity in the 1800s, the 1900s, and the 2000s and the technologies that influence a creative culture.
The sad thing is, the record labels could have avoided reaching this point if they'd bought into the idea of inexpensive online distribution to begin with. When music was only legally available on CD, I often illegally downloaded it because it was so much more convenient. Now that I can buy music a la carte online for about a buck a track from iTunes or Amazon, I find that much more convenient than trying to find good tracks on the illegal file sharing systems, so I get it legally. I suspect I'm not the only one who has followed this pattern.
Say somebody buys MP3s from Amazon.com and stores them on an ftp server at their home. The FTP server has no password, just a MOTD with your standard "Unauthorized use prohibited". Would the RIAA ever have a leg to stand on trying to get that server shut down? Like, they couldn't say "we downloaded a few files and found copyrighted material" because they would be essentially admitting to fraudulant access to a computer system.
My guess is you'd have to show that you'd made some minimal effort to secure the system, besides putting up a disclaimer. But I'm not up on current case law on that issue. I know there was a case recently where someone faced charges for accessing an open wireless network without authorization, but I didn't hear how it came out.
I wonder if there is a legal obligation to protect copyrighted material you've licensed. Hmmmm.
re #19, 21: That's already been the subject of arguments in some of the file-sharing lawsuits. The record companies have attempted to claim that "making available" amounts to punishable behavior. The last I knew the issue was still strongly disputed and at least some of the courts in which the issue have been raised have been unsympathetic to that type of claim but as far as I am aware the issue is not settled one way or the other. Which probably suits the record companies for the time being, as it's the *fear* that you might be sued, rather than the actual lawsuits themselves, that they count on to keep people in line.
All I read was something about Napster being destroyed. Who gives a fuck.
If you keep posting this many short and relatively meaningless things I am going to stop reading your posts. Please think before you post. I am not trying to be mean, just letting you know the effect that it has when you post one line in every item but don't really have a lot to say. It takes a lot longer to go through agora.
Fuck you, bitch. My opinions are sometimes short. That does not mean they are MEANINGLESS. I don't mince words. In fact, I am repulsed by talkative people. Your story about the mouse that entered your house was WAY TOO LONG, for your information. However, I read it, and responded to it. I'm not very threatened by the fact that you will "stop reading" my posts. I am entitled to my opinion and I gave it in a slight few words. I would be very interested in knowing just what profession you are in that causes you to be so upset about spending five or ten more minutes reading posts on a (basically worthless) chat site?
tl;dr
That's okay since it wasn't addressed to you anyway. :)
Here comes the Grinch with more Christmas Shopping Cheer!!
"http://www.reuters.com/article/musicNews/idUSN0132742320071201?sp=true
It's Billboard's coverage of album sales for the week including Black
Friday, the unofficial start to the holiday gift-shopping season.
>> " Merchants reported a comparable-store music sales decline
>> ranging from 15 percent to 25 percent for the weekend that begins
>> with Black Friday, although they said robust movie and videogame
>> sales helped soften the blow.
>> "Nielsen SoundScan data backs up those merchants' reports. Album
>> sales totaled 13.9 million during the week ended November 25, an
>> 18 percent decline from the 17 million sold last year during the
>> Thanksgiving weekend." << ENDQUOTE
One number leaps out as especially dire, reflecting the collapse of
Tower Records plus sizable closures of other chain retailers such as
Virgin Megastore and Transworld/FYE:
>> "By store type, album sales at chains (including merchants
like Trans World, Best Buy and Barnes & Noble) were down *** 40 ***
percent, indies were down 22.6 percent, and mass merchants were down 6
percent. However, nontraditional outlets were up 17.7 percent." <<
(Nontraditional merchants are dominated by Amazon;
Starbucks is also lumped in here.)
Most retailers are blaming a lack of new hit releases. (Why are there
no new hit releases?) Wal-Mart did very well with their exclusives
on the Eagles and Garth Brooks.
One small music retailer in Wisconsin said DVD sales were skyrocketing.
>> "At the 10-unit Exclusive Co. in Oshkosh, Wis., for example,
>> general manager Stephanie Huff reported that DVDs were up 216
>> percent Thanksgiving week. TV shows drove the DVD surge,
>> she added."
-----
Note that the Nielsen Soundscan number for album sales (digital tracks
sold in an album bunch, and physical CDs) was down 14% Year-To-Date
leading up the Thanksgiving. To have that number suddenly accelerate
to 18% (week to same week year ago) for the week indicates that there
is no hope of any improvement in sales for holiday season 2007.
I expect physical retailers to go forward with their worst-case
plans for reducing their CD-selling operations in early 2008. This is
likely to be 30% floorspace reductions and more at the mass merchants
-- how much space does Wal-Mart need to sell its two hit artists? --
and many indie stores will just surrender as lease renewal
comes around, as they contemplate business prospects over the next
several years.
And I should care if someone else makes a lot of money, why? THe stupid music industry is RIDICULOUS with how they gouge consumers just to listen to some music or the movie industry who charge people so much for DVD's that cost them barely pennies to make (I'm guessing, but I bet I'm right). UH OH! Maybe SOMEBODY needs to stop paying exhorbitant salaries to d*ckwipes like George Clooney and other actors. I'm happy. I hope we're starving those rich soulless "celebrities".
My old homey.. December 3, 2007 BY GRETA GUEST FREE PRESS BUSINESS WRITER Record Time in Ferndale will wind down operations after the holidays with a clearance sale before its owner consolidates operations at his flagship Roseville store. The Roseville store opened in 1983, with Ferndale following in 2000. Owner Mike Himes said his business will focus on the Roseville and eBay stores, Amazon.com and his e-commerce site. "We have lasted longer than anyone else has, so we must be doing something right," Himes said. "I love the vibe here in Ferndale. There just aren't enough people coming in." Ferndale's main shopping area on Nine Mile has declined along with Michigan's economy. Empty storefronts are becoming more common, particularly since the Old Navy store at Woodward and Nine Mile closed in the summer. But news of the impending closure of another independent music store feels like Harmony House all over again. Harmony House went out of business in 2002. "It's kind of a sad thing," said Jonny Victor, 32, who was shopping at Record Time in Ferndale last week. "I much prefer to shop at an independent music store. I like to get the actual CDs instead of downloading them." The Farmington Hills resident said he had been going to a music store in Novi until it closed. Then he found Record Time. A trend winds down About 1,200 independent music stores have closed since January 2003, said Joel Oberstein, president of Studio City, Calif.-based Almighty Institute of Music Retail, which offers marketing and other services to independent record stores. There are still about 2,500 left, Oberstein said. In Michigan, 42 independent music stores have closed, leaving 63 stores, according to the institute's figures. Harmony House closed its remaining 20 stores in 2002. The local chain was founded in 1947, but the mix of competition from Internet downloads and mass-market retailers did it in. The chain had 38 stores at its peak in 1999. "What you are finding now is there is a survival of the fittest mentality in many of the stores," Oberstein said. The stores that make it amid double-digit percentage declines in CD sales and other economic pressures are the ones that diversify by selling other items in the store, such as T-shirts, and selling online, Oberstein said. "You have to do a little bit of everything, I guess," said Mike Rome, co-owner of Street Corner Music in Beverly Hills. Putting items online Rome said he sells records and 45s on eBay and puts CDs that don't sell in the store on Amazon. Himes said he expects to start the clearance sale Dec. 29, and it will continue until he can sublet the 4,400-square-foot store to another business. He's hoping to close in February. Sales at the Ferndale store are down 10% to 30% most weeks, Himes said, while the Roseville store has been holding its own. "We sell music physically. The east side, being more blue-collar, is less affected by techology. The west side is more affected by technology and the iPod age," Himes said. "It feels like I'm selling typewriters or pay phones; you don't see those anymore." Himes also feels frustrated by an industry where all the marketing dollars are moving toward the digital delivery of music. Also, exclusive content is first going to venues like iTunes, and the independents can't get it for 60 days. Big box retailers are also getting exclusives the little guys can't. "We're looked at as a last stop, even though we are the people who get bands started," Himes said. "They say they appreciate what we do, but sometimes we've got to wonder." Himes said he will let go about five employees in Ferndale when he transfers all operations to Roseville. He has 15 employees at the 9,000-square-foot Roseville store on Gratiot near I-696. "We are leaving Ferndale, but we want to make Roseville bigger and better," Himes said.
I suppose I should go look at the Roseville store; I've never heard of it. I had no idea that there were 60 independent stores left in Michigan; I wonder if that number includes the stores which sell primarily used CDs?
Re resp:30: I really feel for Michigan. The national economy is about to go into another recession, and Michigan hasn't even recovered from the previous one yet.
Michigan is fine. We have the Great Lakes. And more. I see nothing for you to feel negatively about, gull.
I was in California visiting a sister over Thanksgiving, which meant I had an opportunity to peruse some of the sale circulars for Black Friday and the rest of the post-Thanksgiving weekend. Although I remember the advertisements for Best Buy, Circuit City, Target, etc, prominently featuring sales on DVDs, I can't remember any of them devoting a significant amount of space in their sale circulars to music. In other words chain stores didn't even bother really promoting music sales this Thanksgiving weekend, either because they knew they didn't have anything that would draw in customers or because they expected other items (DVDs, etc) to do better. Note that most of these chains had advertisments featuring specials on MP3 players, so it's not that they didn't expect people to spend money on equipment to listen to music, just not on the music itself.. (There's another possibility, though: I didn't study the advertisements closely -- it's possible there *was* some music prominently featured but that the titles were so forgettable to me that I even forgot about the advertisement. I'm not sure that's a brighter scenario from the record companies' points of view..)
Magazines and CDs are a loser in a storefront. You can get the info readily online.
Which I suppose is a blessing and a curse. Sure, there's something to be said about the instant gratification of getting music online, but there are some titles that I want a full-fidelity (issues about CD level boosting aside) rendition of. I don't really care too much about the latest Rhianna song sonding a bit compressed, but I care a whole lot about losing *anything* in a Kolacny Brothers recording. I used to love going to Harmony House to find more obscure albums... but then their Novi store became a mega JoAnn Fabrics, followed by their Farmington store becoming nothing. So I found a new home at Record Collector in Livonia, forcing them to promptly close. Repeat the Beat in Plymouth? Gone. Switched On CD's in Novi? Gone. Even Borders has switched to mini kiosks of hypercompressed "everything in the store" samples, instead of legitimate listening stations where you could hear a full track if you wanted to. At that rate, it begs the question: Why drive 30 minutes to listen to crappy mp3 samples of music on headphones of dismal quality and questionable hygiene, when I can listen to crappy mp3 samples of music on decent speakers on demand, spend half as much money on the product, and save gas by not driving? Then again, it also goes back to UScan. Much like I'm doing a cashier's job at a store with a UScan, I'm doing the production factory's job buying and burning my discs from iTunes or Amazon. Anyway... Music is broken.
Well, with broadband speeds being what they are, if there's a significant demand for non-compressed content out there I'm sure sooner or later it will be available. And I don't think the CD is going away any time soon, but you may have to resort to mail-ordering them. For me it's not that big a deal because stuff I want is rarely in stock at music stores anyway. I figure if I have to wait for it to be shipped anyway, I might as well just have it shipped to my doorstep.
Unfortunately, the demand for high-quality audio content (or video for that matter) doesn't seem to be all that great. The trend is toward quantity and convenience over quality.
We are DEVO.
Re resp:38: Well, audiophiles have always been a minority. And a lot of them are still insisting on vinyl.
i haerd that rcord cmpanies are no longer ot suport the cd format as of jan 08 .. is this ture?
re #41: That's not even remotely plausible. January 2008 is only about three weeks away at this point. What would they replace it with? I suppose it's possible that by "no longer support the CD format" whatever source you read that in means that record companies will no longer bother ensuring their releases (especially the copy-protected ones) will play in all spec-compliant CD players. They already crossed that Rubicon a while ago, though..
I'd be curious, ts, if you can find the source on that. I follow music biz news about as much as any consumer, and I have heard nothing of the sort. The closest I can come up with is widespread reports that the major chain retailers, such as Wal-Mart, Target, Best Buy, and maybe even Borders, are going to cut 30% or more of their CD space after the holidays, which would be January 2008. And DRM embedded on CD appears to be a completely dead issue for normal consumer releases. There may still be some DRM software applied to promo/review copies to try to control early file-sharing leaks on new releases, but I believe that the four major labels have dropped all copy-protection efforts on consumer CDs. There were two things driving that decision: (1) the messy fallout from the "Sony Rootkit" DRM; (2) the labels finally were forced to accept that a large number of CD purchasers intend to put the music on their iPods, an operation which was obstructed by most of the on-CD DRM systems. <krj realizes that the second paragraph is probably incomprehensible to anyone who hasn't been following the "Music War" saga. >
Oddly, the movie industry doesn't seem to have learned from the music industry's tribulations. Copy-protected DVDs are starting to appear.
(Copy protected in ways other than CSS encryption, I mean. They're being designed to make it hard to copy the encrypted VOB file from the CD to a computer.)
Who cares? The movie industry is greedy. After they have you pay to see the movie in the theatre, they want to pick your back pocket for the DVD.
Gull: Bring us some references if you can? I'm so saturated in music-biz coverage that I am not keeping up with much of what is happening in Videoland.
I don't have any general news sources, just complaints on the MythTV forum. (MythTV has a feature that allows "ripping" DVDs to files on a hard disk, so you can view them more conveniently, just like you can rip CDs to your hard disk to listen to them with greater ease.) Apparently some DVD releases now have large numbers of intentional bad sectors. Consumer DVD players ignore these and keep right on going, but DVD-ROM drives spend a lot of time retrying them.
Ah, same sort of trick that was done by Cactus Data Shield, among others, for the CD market. Incidentally, I don't have the link immediately available, but the expectation is that DVD sales are going to finish down 4% for 2007, compared to the previous year. This will be the first decline in DVD sales ever. I think these are USA numbers.
4% of the market sounds like a plausible estimate for Blu-Ray and HD-DVD market share (combined) at this point, give or take a bit.
hmmm a 0 or a 1 ?
re 43 ... um, i;ll atake a look for yuo.. it was absorbed in passing so i might ahv emis-something-or-othered the news.
This one is an ugly URL, sorry: http://www.northjersey.com/page.php?qstr=eXJpcnk3ZjczN2Y3dnFlZUVFeXkxNjcmZm diZWw3Zjd2cWVlRUV5eTcyMjc5OTMmeXJpcnk3ZjcxN2Y3dnFlZUVFeXk3 It's a report on New Jersey-based small CD labels which are encountering more and more difficulty. The main label profiled in the story is Shanachie, which handles a great deal of Celtic folk and reggae. Indie rock label Bar/None is also in distress. In contrast, metal label Eclipse is doing well; they get more from iTunes sales per copy than from physical CD sales. Shanachie says sales are down 20% over the last five years. The loss of Tower Records and small retailers has been a blow. Borders is no longer welcoming to small indie labels; they are demanding a $2/copy "co-op" payment to stock the discs in their store. (I did not know that Borders had moved to demanding a stocking fee from labels; I thought that was only a policy at Trans World.) Shanachie used to be able to work some with Wal-Mart (!!) but Wal-Mart is now streamlining their CD selection and Shanachie and other specialty labels are now mostly frozen out. ----- The Nielsen Soundscan numbers for CD sales are turning into a rout at the end of the year. These are gleaned from the week-by-week sales reports from Billboard and no one story has yet assembled the threads: In early November, off the top of my head, year-to-date album sales were down 14% from 2006. For Thanksgiving week, including the famous Black Friday shopping day, the downturn accelerated: sales for that one week were down 18% vs. that week year ago. For the next week, the downturn accelerated again: sales for the one week were down 23% vs. year-ago. That's the most recent sales report. Those numbers are for album sales, defined as [CDs + downloads sold in an album-bunch]. Including single track downloads probably makes the number look a small bit better, but this is still awful for the labels and for retailers. The rarely-reported numbers on physical CD sales are usually -5% from the commonly cited album sales number, so that would speculatively put last week's CD sales as -28% compared to the same week last year.
Who cares? If your music is good, people will be begging for it.
re 53 ... jhere ios the shlrot non-ugly version: http://url.rexroof.com/16616
You have several choices: