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Media Research Exec Says Music Industry Is On Its Last Legs

Zonk posted more than 6 years ago | from the internet-killed-the-video-star dept.

The Almighty Buck 401

Ponca City, We Love You writes "For years, the major record labels have fought a pitched battle against the MP3 format. Although major labels like EMI and the Universal Music Group have embraced MP3s in recent months, a story from the Mercury News says early returns from those moves indicate they've had little impact on the industry's fortunes — for better or for worse. 'These are ailing businesses on their last legs,' said Eric Garland, chief executive of BigChampagne, a market research company focused on digital media. The question of copy protection on song downloads 'matters a whole lot less to them than it once did.' The industry has a bigger problem. Consumers used to buy CDs for $10 or $15 a pop. Increasingly, they're buying songs at about $1 apiece instead. So, even if transactions continue to increase, the industry is seeing far less money each time consumers buy and it's having a difficult time making up the difference."

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So long Music Industry... (5, Funny)

PollGuy (707987) | more than 6 years ago | (#21533573)

So long Music Industry, and thanks for all the Phish!

Re:So long Music Industry... (5, Insightful)

ajs (35943) | more than 6 years ago | (#21533903)

The music industry isn't going anywhere. Remember that they're "on their last" $200B leg.... Lots of change is coming, change that should have come long ago. That's the nature of business. The industry isn't going anywhere.

Re:So long Music Industry... (5, Insightful)

devjj (956776) | more than 6 years ago | (#21534151)

Don't be so sure. When a band can distribute its albums by posting a zip file on a web site, there's a lot less incentive to turn to labels. The industry exists right now because it exists - not because it's necessary. As people start to see how the economics of giant media labels work against them, the tide can turn.

Entire industries (as we think of them) don't disappear overnight, but they do sometimes disappear, or change into something so different you couldn't really call it the same industry with a straight face. That's where we are. They're a dying breed, whether they know it or not.

Re:So long Music Industry... (4, Insightful)

ISoldat53 (977164) | more than 6 years ago | (#21533955)

The real reason the music industry is dying is because of the crap they have been putting out. Why buy an entire CD when only one track is worth listening to.

Re:So long Music Industry... (1)

jwo7777777 (100313) | more than 6 years ago | (#21534173)

It wouldn't be so bad if the shit they were shitting wasn't the output of dysentery and they didn't insist on using our ears as toilets and making us pay for the privilege.

Re:So long Music Industry... (1)

vimh42 (981236) | more than 6 years ago | (#21534031)

The "Music Industry" isn't going anywhere. It's simply going to shed some weight, adapt, but it won't die. The old guard will pass away. However, as long as people make music and as long as somebody listens to music, the "industry" will be alive and well. It's just the groups that can give people what they want that will be bringing in the money, or if nothing else, simply have an audience.

Re:So long Music Industry... (5, Insightful)

rudeboy1 (516023) | more than 6 years ago | (#21534065)

You know, I thought about it, and it hit me: What would happen if the music industry (at least the Big Guys) collapsed? Well, aside from Best Buy having a lot more floor space, not a whole lot. Big artists would be forced to adopt more modern means of distributing their music, without a giant, bloodsucking middleman. Recording studios would be hit rather hard, but I think that's coming anyway, with the increasing influx of commercial-level products and software that can be bought for next to nothing (comparatively speaking) and produce professional results. The CD would find continuing life in sales at local shows, but would die as a retail product. Touring bands (again, adapting to the modern age) would need to hire their own publicity people to get butts in the seats at local venues, instead of letting the record company do it for them, but would probably be able to afford it, as the record companies normally take the majority of a tour's gross anyway.
    There would be some implosions in the current model that would on the surface appear to negatively impact the artist and consumer. While the artist would spend more promoting on their own, distributing on their own, recording on their own, they would likely be letting go of a static percentage similar or likely less than they do now to industry giants.
    The state of DRM would change, as there would be no more litigation funded by record companies (leaving the MPAA to twist in the wind without a partner in crime) and less funding toward P2P obfuscating and software rootkit technologies. The online download would become the primary medium of the industry, and while I agree there is a need for some copy protection, to prevent widespread distribution, without a monolithic industry behind it, less invasive alternatives may finally see the light of day.
    Personally, I wouldn't say I've been actively boycotting Big Music, but I guess you could say I have been, subconsciously. I haven't bought a CD in probably 10 years. I do support larger artists through iTunes and Amazon's DRM-free initiative. I also spend WAY more time and money on local/touring artists on a face-to-face level. Local artists, I buy tickets to shows, help promote (street team style), buy merchandise when it moves me, and basically just stay active in the scene, cross genre whenever possible. Touring artists, I will buy a ticket to a show, avoiding Ticketmaster at all costs, buying their CDs and merch in person, where they generally get a larger cut of the sales.
    I'm all for the collapse of the industry. It appears to be the only means of innovation, and it will right a lot of wrongs currently out there. Unfortunately, the best way to do this still seems to be choking their sales as much as possible, usually by illegal downloads and bootlegs. I hate to see the artists suffer, but it is definitely causing a positive effect, as more and more artists are breaking away from Big Music to go it alone. Sometimes the best way to change a law is to break it. We shall see.

Recruit Better Talent (4, Interesting)

N8F8 (4562) | more than 6 years ago | (#21533589)

They need to do a better job of recruitment. On any given night I can find better bands playing at local clubs then I hear on the radio. How about they all chip in to recreate a free classic MTVesque station to market directly?

Re:Recruit Better Talent (3, Funny)

RingDev (879105) | more than 6 years ago | (#21533665)

You need better radio stations.


Re:Recruit Better Talent (1)

N8F8 (4562) | more than 6 years ago | (#21534063)

Good point. Even better, lower the entry boundary for new stations to the floor just as the web has done for print media.

Re:Recruit Better Talent (5, Informative)

rudeboy1 (516023) | more than 6 years ago | (#21534233)

True. I have yet to understand why ClearChannel can get away with almost a complete monopoly of the radio business. I bet you if you looked up every major radio station in your area, (assuming you live in the US) you will find that the vast majority of them are run by this one company. They have openly admitted they play a very strictly regulated playlist on their stations, driven by sales, not by listener demand, or the search for new music. They are generally limited to a very small list of songs as well, both as a means of "playing it safe", playing only songs they think everyone wants to listen to (thereby not taking risks on new music) and as a means of keeping their royalty fees down. It's a sad state of affairs, but unless you have satellite radio, you're stuck with pretty bland choices.

Re:Recruit Better Talent (1)

SSG Bryan (6636) | more than 6 years ago | (#21534409)

The reason why is Media consolidation Laws courtesy of the Republican Party during the Saint Reagan era.

Re:Recruit Better Talent (3, Interesting)

ByOhTek (1181381) | more than 6 years ago | (#21533857)

Aye... I can only think of two modern artist that's released a CD that I like all but (at most) two songs in the past decade.

I look at older stuff; Don Henley, The Eagles, Chicago, Billy Joel, earlier Metallica, etc, etc, when in any given decade from between the 60s and 90s where I can easily find multiple artists with multiple CDs fitting that criteria.

The problem isn't the new formats; the problem is the quality of the groups that are out now.

A good set of experiments to verify this

Survey people with 1-5 albums that have come out each year from 10 years before the person was born, until he/she turnes 50 (obviously younger people won't have as many). Say the top 5 albums, and 5 random albums

List the albums and the tracks. Have the individuals pick which songs (assuming they weren't available) the users would pay $1 to download.

Correlate data to two charts
(1) %of songs people would buy vs. year
(2) %of songs people would buy vs. year relative to birth

That would be an interesting experiment, you could use data from chart 2 to help normalize the "it was popular when I was younger and more influential" bias.

Anyone know if anything like this has been done?

Re:Recruit Better Talent (1)

Maxo-Texas (864189) | more than 6 years ago | (#21533901)

I agree-- even Blue October has one or two songs per CD that I could pass on after hearing once.

And here is me... (5, Funny)

Jaysyn (203771) | more than 6 years ago | (#21533595)

...playing the world smallest violin.

Re:And here is me... (4, Funny)

Hanners1979 (959741) | more than 6 years ago | (#21533637)

If that doesn't get the RIAA knocking on your door, I don't know what will...

Re:And here is me... (4, Funny)

Dr. Eggman (932300) | more than 6 years ago | (#21533661)

Sir, I have been authorized by the RIAA to halt this unauthorized and illegal reproduction of copyrighted silence.

Re:And here is me... (1)

Red Flayer (890720) | more than 6 years ago | (#21533769)

Meh. Philip Glass never sold his soul to the RIAA...

Do you have his express written permission for that silence?

Re:And here is me... (2, Informative)

s.bots (1099921) | more than 6 years ago | (#21533837)

I think you mean John Cage (for the silence part, no idea if his soul is now property of the RIAA)

4'33": []

Re:And here is me... (1)

Red Flayer (890720) | more than 6 years ago | (#21533985)

Yup, sorry. Though Glass is well known for using silence in his compositions.

And, of course, he does compose movie scores that are distributed by RIAA labels.

Damn it, I was wrong on just about everything in my post. Sigh.

Time to get more coffee.

death of the industry or of the album? (5, Insightful)

spyrochaete (707033) | more than 6 years ago | (#21533619)

Seems to me TFA predicts the end of the album as we know it, not necessarily the music industry. Could we be entering the golden age of the one hit wonder?

Re:death of the industry or of the album? (5, Funny)

GodfatherofSoul (174979) | more than 6 years ago | (#21533737)

You, Sir, were not alive in the 80s.

Re:death of the industry or of the album? (5, Funny)

spyrochaete (707033) | more than 6 years ago | (#21533959)

I was going to dial 867-5309 to ask for a witty retort but instead I ran - I ran so far away.

Re:death of the industry or of the album? (1)

SSG Bryan (6636) | more than 6 years ago | (#21534129)

Damn, love the flock of seagulls reference!

And me with no mod points.....

Golden Era of the One Hit Wonders (2, Informative)

Anonymous Coward | more than 6 years ago | (#21534021)

You, Sir, were not alive in the 80s.

And YOU, my good sir, were not alive in the 50's and 1960's, else you'd know that those were the true golden years of the one-hit-wonders. After all, "making a record" meant a 45 rpm single phonograph disc back then with the primary song on the "A" side and some filler material on the "B" side.

Re:death of the industry or of the album? (2)

moderatorrater (1095745) | more than 6 years ago | (#21533781)

I would imagine just the opposite. It takes a lot of money to get those artists signed onto a label and then touring. If you have a group/singer/whatever that can only sing one good song, they're not going to have the touring ability that a great group with more depth will have. The one hit wonder made a lot of money because people bought it for 10x the price. Now that people can buy albums in whole or in part, they can choose to pay more money for albums with multiple good singles on it.

Re:death of the industry or of the album? (5, Insightful)

explosivejared (1186049) | more than 6 years ago | (#21533783)

I think that it means the end of the arbitrarily compilation of an album. With digital dissemination artists can release music as they create it, and receive support as they create music. An artist no longer has to rely on marketing a compilation every year or so. The album dominated market is artificial scarcity. It tries to create a market where that is the only music you are told to expect from an artist for a long time. It simply doesn't happen like that. I know sometimes it helps to release songs together as they sometimes compliment each other. By and large however, albums are just another way to generate revenue for the distributor and not the artist. So I say good riddance to the album. Really, half the time albums are about 80% fluff just to pad the track numbers in order justify the price.

Re:death of the industry or of the album? (2, Interesting)

Jason Levine (196982) | more than 6 years ago | (#21533971)

I'm not too current with my History of Albums Worldwide knowledge, but isn't the album a relatively recent occurance? Weren't songs previously released as they were finished? If so, this might be just the death of the (relatively) short-lived album concept.

As a side bonus, since they won't have recording industry execs telling them "If you're gonna have a hit, you gotta make it fit" and cutting the song down to 3:05. We might see more songs five or more minutes in length. Of course, this might lead to some really bad 5 minute songs, but it might also lead to some brilliant 8 minute songs that would otherwise have been sliced and diced into an awful 3 minute version.

Re:death of the industry or of the album? (1)

MrAndrews (456547) | more than 6 years ago | (#21534049)

But releasing only singles every few months/weeks means the entire marketing engine for the music industry has got to change too... making 7 or 8 mini-campaigns every 45 days (rather than 1 big one every year) might make the labels be even MORE stingy about who they bother promoting, because I'm guessing a lot of the costs don't disappear after the 1st iteration. So in exchange for the death of the album, we might be getting the death of top-level diversity.

On the other hand, that sounds more like a proper Long Tail scenario (tiny fraction of super-hits and a large bulk of lesser hits), which gives one hope that the playing field will be a bit less tilted in favour of the big players.

Re:death of the industry or of the album? (1, Interesting)

Anonymous Coward | more than 6 years ago | (#21534363)

I beg to differ.

My band is expecting our album to be ready sometime in early spring. During the recording session this past summer, the topic of song order came around. Now, our album overall, is intended to tell a story, or more eloquently, a plea to the masses to wake up. The intent of the album is to have it behave like that of Pink Floyd's 'Dark Side of the Moon'. Each song links into the next, as if your are listening to a seamless audio session, or one continuous track. That, combined with production dynamics, i.e. balance fades, echo effects, and the like, the idea is to create something of a kickback to the original IDEA of a album to be listened to. Not just heard. The lyrical content also tells of a story or plan, and is ordered like that of a doctrine or declaration.

Though it was fairly easy for us to come up with the songs and content, we didn't really realize how meticulous it all was when we put it together in this fashion. Once it is available for release, I will gladly announce it to the masses of slashdot. Till then, any recordings we have really don't do justice to music.

* No we do not think it will sell like Pink Floyd's DSOTM. We do hope that people will recognize and appreciate the creativity that lay within and support us for those efforts.
** Yes, I'm tooting my horn, but since I'm AC, that doesn't matter, does it?

Re:death of the industry or of the album? (1)

Scrameustache (459504) | more than 6 years ago | (#21533881)

Seems to me TFA predicts the end of the album as we know it, not necessarily the music industry. Could we be entering the golden age of the one hit wonder?
The album format only became relevant in the late 60's, thanks to the Beatles and other groups who'd make more than radio-ready bits.
The bands back then had to fight the labels to get them to release albums, and now the pendulum has swung back.
Some albums are worth it for the experience, some are just a good song or two with lots of filler.
The trouble is, the excecs that insist on shoehorning their "product" into one category or the other, according to their belief of what is profitable.

Kill them all, let Clapton sort 'em out.

Re:death of the industry or of the album? (1)

flitty (981864) | more than 6 years ago | (#21533927)

Just look at T-Pain [] and his success selling ringtones instead of singles and being a "ringtone artist". I love full albums, and will search for "complete" albums (such as Muse's Black Holes and Revelations, which is the most recent "album" I've seen), but I think we are just returning to a couple of years like that of the 45 single. It's not going to kill the industry, but they will have to complely restructure to survive. They will, and those who don't will explode and start new companies that can adapt.

Re:death of the industry or of the album? (1)

UncleGizmo (462001) | more than 6 years ago | (#21534001)

I believe we already have. This is my opinion, but how many popular albums have come out recently whose songs are a cohesive part of a whole? Nowadays it seems like every song on a popular artist's album is geared to be a potential single, rather than part of a whole collection. I'm talking major releases that are for the radio, not indies.

Death of the album (2, Insightful)

ThirdPrize (938147) | more than 6 years ago | (#21533621)

Frankly I won't mourn the deat of the album. There are very few out there that work as a whole. even the best artists pad them out with filler. Especially since the advent of the CD meant they had 80 mins to play with.

Re:Death of the album (1)

geekoid (135745) | more than 6 years ago | (#21533803)

Just so you know, the CD holds less music then an album. There were several works that did not fit onto a CD in their entirety.

Re:Death of the album (1)

ThirdPrize (938147) | more than 6 years ago | (#21533921)

That is double albums though. Dont get me started on the 2x45 min CDs some artists release.

Re:Death of the album (1)

Kadin2048 (468275) | more than 6 years ago | (#21534009)

True, although an LP is different because it's naturally broken into two sides, meaning you need a transition point between them.

In terms of continuous music that you can play without any breakpoint, a CD is obviously longer; I think that's what the GP was getting at. Although not having the ~90 minute overall length is annoying, personally I think having 74 minutes nonstop makes up for it -- although it obviously depends what kind of music that you listen to. In some ways, the LP was better for classical music that was built around an intermission.

Although I've never seen one (I guess it wasn't possible when CDs were introduced, and has never been desired since?), you could certainly now produce a CD that was double-sided, like an LP, with 74 minutes to a side, almost 160 minutes total...not that there'd be much demand for it now, when you can put hours onto a CD with modern compression, perhaps even having it sound better than 44.1/16 PCM.

Re:Death of the album (1)

pipatron (966506) | more than 6 years ago | (#21534303)

Huh? So why is all my music like Mike Oldfield and Tangerine Dreams and others that made really long songs always split into part 1 and 2, where part 1 is 20-25 minutes on side A and part 2 is also 20-25 minutes on side B?

Re:Death of the album (4, Insightful)

mr_mischief (456295) | more than 6 years ago | (#21533847)

This is exactly why the single is the big deal now. If an album was 12, 15, or 18 great songs then people would buy all the songs.

Some albums were a cohesive experience. "The Wall" by Pink Floyd isn't one song and 9 batches of bad rehearsal. Led Zeppelin's albums always fit pretty well together, too. Lots of rock bands did this at one time or another, and the easy listening people nearly always do.

As for the album as just a compilation of unrelated songs, sure, some bands and soloists have always done B-sides. Some of them did good B-sides, though. 5 great songs and 5 or more good songs is, to me, worth $10. One hit and 9 or more songs the proverbial million Shakespearian monkeys could each write and perform individually is definitely not. This is one reason the movie industry hasn't been hit by copyright infringement quite as hard -- it's called production values.

Another reason is that the movie industry has largely moved to market-based pricing instead of setting a minimum any disc should get (hey -- isn't that illegal anyway?). If a movie just came out and it's really hot on the market, it might be $30 on DVD and $45 on Blu-Ray. If it's a B monster flick from the 1960s, there's a good chance it's in the dollar bin. How many albums from the big four record companies are in a dollar bin, or even a $5.00 bin? Lots fewer than deserve that deep of a discount, I'll say.

Re:Death of the album (1)

gsslay (807818) | more than 6 years ago | (#21534411)

I think you're telling us more about the calibre of artist you listen too, rather than any limitation of the album format.

A DRM'd copy... (2, Funny)

Suicide Drink (1125803) | more than 6 years ago | (#21533631)

of a recording of the world's smallest man playing on the world's smallest violin plays the world's saddest song...

Apropos quote in the article (4, Insightful)

BadAnalogyGuy (945258) | more than 6 years ago | (#21533641)

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What a clever way to show how propietary content and artificial constraints on access can spell doom! I bet more than half the comments in this thread will be about the idiocy of putting a registration-required article in the summary.

As for the actual topic at hand, if the music industry goes away, who will provide music? Once the vacuum is created, it will be filled by someone else. Music isn't like buggy whips. Maybe it's like bottled water, though. You used to get it in those plastic gallon bottles, but nowadays you mostly get it either from large 5 gallon jugs or 500ml bottles. Content stays the same, packaging and marketing changes.

What's the bottom line? The evolution of the music industry will lead to dumber and more expensive product of something that is essentially free otherwise.

Re:Apropos quote in the article (1)

mordenkhai (1167617) | more than 6 years ago | (#21533707)

Your proposed complaint ratio only works if you assume half of the posters on /. actually attempt to RTFA.

Re:Apropos quote in the article (2, Informative)

BadAnalogyGuy (945258) | more than 6 years ago | (#21533739)

I just need to call enough attention to it. Slashbots will complain about any perceived slight, no matter how unaffected they are.

Re:Apropos quote in the article (0)

Anonymous Coward | more than 6 years ago | (#21533749)

So does anyone have a link to the "no-login-required" version of TFA?

Re:Apropos quote in the article (1)

Delusion_ (56114) | more than 6 years ago | (#21534127)

You can get pre-made accounts for this kind of web idiocy at

Re:Apropos quote in the article (1)

Dancindan84 (1056246) | more than 6 years ago | (#21534027)

Yeap. Music was around (and people made a living off of it) long before it was an "industry." Really though, if you look at how they get paid not much is going to change for the artists. They'll still get most of their money from doing concerts and live performances. They may actually be better off if the big labels die. Life will go on.

Re:Apropos quote in the article (2, Funny)

Chris Mattern (191822) | more than 6 years ago | (#21534275)

if the music industry goes away, who will provide music?


Chris Mattern

Oh noes! (4, Insightful)

Angst Badger (8636) | more than 6 years ago | (#21533647)

Does that mean that if the record companies want to keep making money, they need to produce albums with a bunch of good songs instead of a $16 album with one good song? Oh, the humanity!

Trash music (1)

getnate (518090) | more than 6 years ago | (#21533653)

Hopefully this will help reduce trash music, apparently increasing the quality of music available.

I'm calling BS on this (4, Interesting)

DustyShadow (691635) | more than 6 years ago | (#21533671)

I really think this is BS. I have a friend who has worked at Atlantic for the past year or two and he currently has 5 gold records hanging on his wall and one platinum is on the way. If these bands are selling so well, why is the industry doing so poorly. Also, these bands are not totally mainstream. I bet 90% of /. hasn't even heard of them.

Re:I'm calling BS on this (-1, Offtopic)

Anonymous Coward | more than 6 years ago | (#21533691)

I hate you! And I hate the band you like!

Re:I'm calling BS on this (1)

GodfatherofSoul (174979) | more than 6 years ago | (#21533899)

I see two angles. If they're lying, they're doing this as a set up for their anti-piracy campaigns ("Woe is me!"). Look at what's happening to the movie producers. They've been running around *bragging* on the record about how much money they're making, then try to turn around and play the pauper when it comes to negotiating with writers.

If they're being truthful, it could be the same story you see in a lot of talent-based industries (and corporate culture IMO). A huge bureaucracy of "suits" wraps itself around the talent/industry and sucks out profits. When any hardship comes along, there are so many financial commitments that the companies fail. Kind of like airlines going down at the same time the execs are giving themselves $100s of millions in bonuses.

Re:I'm calling BS on this (1)

dave420 (699308) | more than 6 years ago | (#21534061)

You should see how many copies had to be sold for a gold or platinum disc. The numbers are constantly decreasing. It seems "idiot baubles" are not just for fans of a certain fruit-based computing company, but record executives as well. The position of the record lable isn't viable at the moment. Of course they can keep devalued platinum discs flying through the post, but the bottom-line of the industry is getting whacked, because of their desire for platinum discs. "If we take these 5 decent tracks from this artist, put 1 of each on 5 albums, fill the rest with crap, we'll sell 5x the records!" is only going to hurt the industry, as soon as the people can either download all the crap for free, or buy only the 5 decent tracks, leaving the rest. Suddenly $100 (5x$20) at best becomes $5, and at worst, $0. Tell your buddy to save up and steal those records before he gets shit-canned, as they might just be paying his rent in a few months time ;)

Re:I'm calling BS on this (1)

iainl (136759) | more than 6 years ago | (#21534181)

It goes like this, basically - the real problem is that they're used to the idea of spending so much on marketing (and/or exec salaries) that 'Gold record' is barely breaking even. Sometimes, not even that.

That's right music industry... (1)

robinsonne (952701) | more than 6 years ago | (#21533705)

At some point all you bigwigs up in the nice cushy offices need to realize that this business model has some PR issues: 1. Fill Albums with crap music. 2. Tell customers to bend over. 3. ??????? 4. Profit!!!

Bah (5, Interesting)

JMZero (449047) | more than 6 years ago | (#21533717)

My understanding is that, for a $1 iTunes download, the breakdown looks something like this:

$.75 - Label
$.20 - Apple
$.05 - Artist

If the middleman (who provides neither the content nor the bandwidth, and takes 3/4 of the money) can't make a profit here then I think perhaps they're doing something wrong.

Re:Bah (1)

jay2003 (668095) | more than 6 years ago | (#21533897)

"They can't stick with this model with the weighted costs that they have," said Mike McGuire, vice president of research at Gartner, an industry research group.

Like most businesses, the music labels costs grew in proportion to their revenues. Revenues are declining and now labels have the difficult challenge of adapting. Though I think they have a bigger problem than the Gartner analyst does. I don't understand what purpose they serve. They used to be a critical part of the distribution chain since was extremely difficult for independent artists to get CD shelf space and radio air play in the pre-Internet world. If iTunes and internet radio, arists don't need the labels anymore. Labels keep a huge share of money from music sales with artists getting very little. Since the labels don't control distribution any more, the artists are better off without them.

Re:Bah (1)

purpledinoz (573045) | more than 6 years ago | (#21533943)

Do you realize how expensive it is to hire an army of lawyers? They really need to increase the price of song downloads to $2.

Re:Bah (1, Flamebait)

theMerovingian (722983) | more than 6 years ago | (#21533975)

Those ratios also probably reflect the amount of investment and work that the parties put in. The label has to produce, market, distribute the music, and handle all the business stuff. Apple has to make enough to offset the cost of their fancy itunes infrastructure. The artists just smoke some pot, sleep with some women, and take all the credit for their commercial success.

Just think - if an artist could be a commercial success simply by being good, they would do it. The skillsets for operating a successful music business are largely at variance with what it takes to be an entertainer. Off the top of my head, the only two artists I can think of who truly understand the music business are Jay-Z and MC Hammer. There have been other artists more successful than them in real terms (Beatles, Elvis, Madonna, etc), but I bet Jay-Z and Hammer took home a substantially larger percentage of the revenue they earned than most of their colleagues.

Re:Bah (2, Insightful)

Gulik (179693) | more than 6 years ago | (#21534017)

Oh, they can make a profit. Just not a profit of the size they would prefer. Remember that, now, they're pulling in $1 for a good song. They liked it better when they were pulling in $15 for an album ... with one good song. Okay, that's unfair to a lot of artists who put out albums that were more good than bad -- but even if you're talking about an album with only good songs on it (and I don't think it's unfair to say that there aren't very many of those), it's still only $8 or $9 to buy all the songs individually. eg: "Bat ouf of Hell," which I think has all solid songs, only has 7 of them.

Re:Bah (1)

noidentity (188756) | more than 6 years ago | (#21534041)

If the middleman (who provides neither the content nor the bandwidth, and takes 3/4 of the money) can't make a profit here then I think perhaps they're doing something wrong.

You're being unfair! After paying for million dollar mansions, drugs, and lawysers, there's very little left over. What will they put into savings?

Re:Bah (1)

boris111 (837756) | more than 6 years ago | (#21534117)

Well they do:
1)Solicit artists (though the quality is in question)
2)Provide the studio
3)Studio costs, sound engineers etc.
4)Pay for a possible orchestral accompaniment
4)And Advertising.

However I do see your point. Why doesn't a company like Apple take on all those other pieces and start their own Record company to solicit artists. Record companies see the old value they had (by charging $20 a CD, but a net-new company is willing to accept that base revenue as their business model. If I was a burgeoning artist I wouldn't mind having Apple do my distribution, studio costs, and advertising for me. Who cares if anyone buys my physical CD in a store? It's funny I get it now.

Re:Bah (1)

SSG Bryan (6636) | more than 6 years ago | (#21534335)

Not quite...
The record labels do not:
Provide the studio
Studio Costs
Pay for possible orchestral accompaniment

The label charges all of that to the artist (out of future royalties). The labels NEVER risk their own money. If they don't make it all back through album sales, then they can A. use the expenses as a Tax write-off (Net Operating Loss) and B. The artist is in hock to the label.

  That is why artist build their own studios to record in. It is actually cheaper.

Re:Bah (0, Redundant)

edwardpickman (965122) | more than 6 years ago | (#21534197)

I guess I'll stick my head in the lion's mouth. Right or wrong major artists spend 5 mill to 20 mill of the label's money just in studio producing the albums with minor artists, we're talking major labels here, costing around 500K give or take a few 100K. Yes it's obscene given the price of studio time but that's what it takes to keeps some of them happy. Some major artists do spend as little as 3 mill cutting an album but they are considered bargins and it's still obscene. Some goes for studio musicians and things that you hear but the bulk goes to the army of people standing around running for lattes and having special food flown in from New York. Another big expense is advertising. It's hard to cover the cost of adverising a maybe hit single that will sell for a $1 compared to a $16 album. One of the biggest expenses is also flop albums. They aren't any cheaper to produce or advertise when they flop so the studio passes on the cost of the flops. Yes factoring all that in albums should probably average $10 retail for major artists and $5 for lesser known so they are reaping huge profits but they aren't a 1000% as some might think. I know less about the music industry but in film the adverising budget is usually 1/3 the cost of making the film as in added on top of the cost. I wouldn't be surprised if some albums had advertising budgets equal or greater than the studio cost. Advertising isn't any cheaper just because production is cheaper. The music industry is hardly the worst offender. Just picture soda pop. The cup costs more than the soda and it's even worse with bottled water. Big business is based on obscene profits. Hey, lobbyist cost money and don't grow on trees ya know.

Re:Bah (1)

JonnyCalcutta (524825) | more than 6 years ago | (#21534425)

Except, and its a big except, the studios don't pay for all the things you mention. What they do is loan the artist the money to pay for those things. And the first thing that happens to the artist's money, before they get to even look at it, is that the studio takes back its loan.

Re:Bah (1)

stormguard2099 (1177733) | more than 6 years ago | (#21534225)

I don't think they are saying they aren't making a profit. I think the "problem" is that they aren't making the same amount of money they were when they were selling boatloads of cds instead of music download money. While your breakdown does make it seem favorable for the label I bet they made more from selling cds, maybe not per song but with the increased number of songs sold due to selling only as albums i bet they make a nice chunk of change.

Re:Bah (2, Insightful)

Maxo-Texas (864189) | more than 6 years ago | (#21534415)

I think it is something like
$.50 - Label
$.20 - Apple
$.30 - Artist
  less .05 for vinyl breakage
  less .10 for distribution costs
  less .06 for cd production costs
  less .03 for packaging costs
  which should be .07 left over but somehow .02 just vanishes somewhere in accounting.

Not dead just BOGOF (2, Insightful)

MosesJones (55544) | more than 6 years ago | (#21533723)

The bit that this "analysis" misses is what we are talking about is the shift away from a pre-bundled offer as the only way to transport the content (music) as the distribution cost for single elements were too low towards a user bundling approach. In other words its moving away from CostCo and the great big packets and towards those nicer supermarkets where you can actually choose what you want. This means moving towards more retailing offers like Buy One Get One Free (BOGOF) and the like. This will tend to mean that albums won't be able to contain filler tracks that are just rubbish but you will be able to buy more dynamic combinations of elements from a single company, band or shop.

Chirping away about "Used to be $10 for a CD now its $1 for a track" is just plain silly as saying its the end of the industry. What it means is that the distribution cost has now been practically eliminated so all that is pretty much left for the companies is the profitable bit, remember the creation and shipping of a CD (although cheap) is a business cost.

The industry has big big issues, but that has nothing to do with albums v mixed basket and everything to do with actively preventing people buying music in a mixed basket approach.

Any options? (1)

192939495969798999 (58312) | more than 6 years ago | (#21533735)

What compelling option is there to the following current scenario: Some CD has 10 songs and costs 10 bucks. I have only heard 3 songs from that CD. I can "guess" that the other 7 are probably not as good since they weren't released as singles, and I can save $7 by buying just the 3 songs I have heard/want. If they want to sell a whole CD, make sure all the songs are preview'able and equally good!

Could have been avoided (1, Informative)

whitelabrat (469237) | more than 6 years ago | (#21533771)

This has been a long time coming. The music industry has been hosing over it's customers for decades and now folks are hosing them back. I'm not saying stealing is right, but from poor quality vinyl records to over priced CD's and more recent crappy or inconvenient formats like DRM or SACD and DVD-A's, the big labels have created fertile ground for music industry anarchy. Reap what you sow.

I like supporting my favorite entertainers, but I don't feel that the music industry gives them a fair shake either.

So good riddance.

Hitting reality like a brick wall (5, Insightful)

SlipperHat (1185737) | more than 6 years ago | (#21533807)

If the music industry of today goes the way of the dinosaur, it is inevitably their own fault. Rather than adapt and work with technology, they chose to fight it and eventually fought their own customers. Companies that had nothing to do with the music industry (Apple, Amazon, etc.) found an untapped and unexplored way to sell music to people at competitive price using the relative ease afforded by the Internet. The music industry now says that they don't make enough money because they find themselves to be the middleman instead of the people with the product.

You built a wall around yourself and ignored the real problem. Your own costs are too high, you rely more on the popularity of an artist/band rather than the true talent he/she/they possess, and you chose to ignore new technology in how it could bring you new opportunities. Think fast or die slow.

Re:Hitting reality like a brick wall (0)

Anonymous Coward | more than 6 years ago | (#21534347)

Exactly. This is Darwin's theory at work, people. Those who fail to adapt to a changing environment...

Reality copies art? A sum. (1, Funny)

mattr (78516) | more than 6 years ago | (#21533809)

Here is a series of terms. Do we add, subtract, multiply, or divide them?

TFA is in a locked site so nobody can comment on it.
MP3 made sense in the last generation of technology, no longer does it make sense to embrace it.
Buying an album always is waiting for the other shoe to drop - which is the good song in it?

An album of filler is to a lossy MP3 of a great performance,
as a subscription-only website is to which of the following:
a. TFA
b. Record industry profits
c. Slashverbowling
c. CowboyNeal
d. All of the above

Indie music (and albums) (3, Interesting)

FlyByPC (841016) | more than 6 years ago | (#21533811)

I just don't see how major music companies are relevant today, when for a small investment, any music group can record their own music at CD quality or better, burn CDs for small production runs, farm out CD production to a mastering company if they hit it big, set up a website for e-commerce and publicity, etc etc. Any genre of music, from classical to folk-rock to metal to New Age, can be recorded fairly easily these days. In many cases (orchestras), the performance is a much bigger headache logistically than the recording, with so many artists involved.

With micropayments and the ease of putting content online, it's hard to see what value EMI, Columbia, and their ilk bring to the table. Most of the music that I enjoy can be found on sites like -- and no matter what sort of music you prefer, the artists would be able to record and produce it without much more effort than it takes to perform it. Let's cut out the inefficient middleman and buy directly from the musicians!
On the topic of albums, they may be declining, but there is definitely something to be said for a well-imagined and well-executed album. IMHO an excellent example is ELO's "Time" album; the songs flow into one another, creating a continuous artistic work, rather than a collection of haphazardly-assembled songs. "Down to the moon" by Andreas Vollenweider is another example.

Re:Indie music (and albums) (2, Funny)

Genjurosan (601032) | more than 6 years ago | (#21534305)

For me this is a very strange moment. In my entire life, I've never met anyone who has even heard of Andreas Vollenweider, and I'm sitting here with my IPOD listening to "Down to the Moon" when I read your comment.

Off-topic, yes, but mod me up +5 for CREEPY.

I woudn't say the industry is in trouble (2, Insightful)

ObiWanStevobi (1030352) | more than 6 years ago | (#21533855)

The overhead is. Artists themselves shouldn't worry, as long as touring isn't a problem. I know myself and 50,000 other people will pay upwards of $70 in less than an hour of opening to see Tool come to town. For all those that leech off the artists and don't do anything but make it harder to distribute and enjoy music, yeah, they're pretty F'd. Good riddance.

Who wants a standard CD? (4, Interesting)

wandazulu (265281) | more than 6 years ago | (#21533875)

'Cause I don't. I've lamented the death of the LP since CDs appeared; the only benefit CDs ever gave me was that I didn't have to flip the disc over. What did we lose? Well, in a lot of cases, liner notes, the cool label on the media, etc.)

What I miss is the *packaging* of the LP. They were big and afforded great album art, along with all kinds of neat extras (like the spinning wheel on Led Zeppelin III, or the zipper on Sticky Fingers, or the stickers and posters in Dark Side of the Moon). And even without the extras there are just so many album covers that are just great *art*. It was the cover that made me buy Joy Division's "Closer", even though at the time I'd never heard of them. Frankly, the album cover, AFAIC, is still the best part of the record. ;)

So, hey, music industry...why don't you downplay the actual tracks and hit up on the packaging? In the Internet world everything is just a stream of bytes so your bytes aren't much more special (and certainly not worth more) than anyone else's stream of bytes. So give it up and make something tangible, keep-able, desirable. Put the disc in a wooden box with a wool interior, or wrap it in tinfoil, whatever...make the *experience* more meaningful. As much as I enjoy the convenience of buying a track in iTMS, I am missing an "experience" that I got with some of the better-packaged albums.

And the crazy thing is that this is not new to the music industry; they've put out special collectors editions of stuff for years and years; I have CDs that came in pseudo-film cannisters, wooden boxes, even bubble-wrap. Sure I paid a premium but I didn't just want the music, I wanted the creative packaging as well.

Re:Who wants a standard CD? (1)

nick graham (1132955) | more than 6 years ago | (#21534331)

I wish I hadn't used all my mod points, as this would surely earn a +5.

Re:Who wants a standard CD? (1)

0100010001010011 (652467) | more than 6 years ago | (#21534395)

The "Art" is still around. It's just now a Music Video.

Music Videos are an 'extra' on top of the song just like the album art was back in the day. They're big money now. Directors, full sets, etc.

Sure most suck and depending on your genre it may just be some women scantily clad, but every so often there's one that I watch than I just think "Wow. That's cool".

Freak on a Leash by Korn is one that comes to my mind.

The party's over (5, Interesting)

Dachannien (617929) | more than 6 years ago | (#21533911)

Witness the power of the free market at work. When you've been fixing prices for decades to shore up your profits, you shouldn't be surprised when that system comes crashing down, once an innovation comes along that turns your industry on its head.

This is how OPEC will feel, if ever we get off our asses and start making commercially viable electric cars.

Re:The party's over (1)

FranTaylor (164577) | more than 6 years ago | (#21534183)

This is how OPEC will feel, if ever we get off our asses and start making commercially viable electric cars.

How's your perpetual motion machine coming? How you gonna charge those batteries? I hope you have a lot of hamsters.

Re:The party's over (2, Insightful)

Dachannien (617929) | more than 6 years ago | (#21534257)


*cry* (1)

jasen666 (88727) | more than 6 years ago | (#21533967)

Yes, this news makes me oh, so sad.
All the bands I like never get signed by any big labels anyway. Such is the fate of industrial/ebm music.

The economy (1)

FranTaylor (164577) | more than 6 years ago | (#21533977)

Who's going to have the $$$ to spend on music when health insurance and energy costs consume your entire paycheck?

...and the Insurgency is "in its last throes" (1)

xirusmom (815129) | more than 6 years ago | (#21534079)

I wish, but don't buy it.

not the entire music industry (1)

scharkalvin (72228) | more than 6 years ago | (#21534081)

When people complain about CD's with 2 good songs and 10 yucky ones they are talking about popular music, IE: rock, punk, rap, etc. While this may be the largest segment of stuff in your local music store, there are other genres where the entire CD is wanted material. Classical music (you know Beethoven, Bach, Rachmaninoff, etc), Movie and Broadway sound tracks remain staple areas. As long as there is a demand for this kind of material CD's won't completely disappear.

Music + over commoditized + extremey competition.. (1)

blahplusplus (757119) | more than 6 years ago | (#21534111)

... = Death

Let's face it, there are so many forms of entertainment out there and only so many hours in a day. Couple that with work, the internet, video games, etc. All forms of entertainment are competing with each other for time that's increasingly not there.

Advertising Disguised A Story (1)

mpapet (761907) | more than 6 years ago | (#21534141)

Head of digital media research company conveniently forgets the enormous costs of producing and distributing CD's.

Let's say for argument's sake, 100,000 CD kits cost $5 to make. Before you sink a half-million on inventory, you pay the printer, graphic designer, shipping costs, editors/proof readers and logistics personnel to get everything to the final CD packager.

You still haven't distributed a single CD. To distribute the CD you pay shipping and a variety of logistics personnel to make sure they are getting where they need to go.

Your sales/marketing costs don't go away with digital distribution and for that reason, the media conglomerates will maintain their cartel and probably make MORE MONEY THAN EVER

Let'em Burn (2, Insightful)

Phoenixhawk (1188721) | more than 6 years ago | (#21534143)

Music industry has been a dinosaur for years, and face it they where never interested in the consumer. For years people HAD to purchase a CD, Tape, Album for all of song, and 10 or 11 pieces of crap filler. Its the EVIL P2P people that our killing the industry they say. Cassette tape have been around for decades and decks biggest selling features being that of high speed dubbing, & synchro starting. Piracy has always been around and always will be. Music always has and always will be copied. Its nothing new, what is new is by being forced to sell music in piecemeal, People are only buying what they want and not getting ripped off on the filler. Using digital format, we make backups. CD/Tape get lost, stolen, broken we don't go out and buy a new one, we burn a copy. (After buying the Metallica Black Album 4 times, who in their right mind would play for yet another copy of something you have already bought and own.) Now while I may download a song, If I like it (ie listen to it more than once) I will support the ARTIST and buy a copy or at least order a t-shirt or something from their website. Nobody ever has any love for the greedy labels, who do nothing but take most the profits of the artists. Today with digital formats the artist can bypass the label all together and guess what they get 100% of the profit and nobody misses the label. We the consumer are not forced into paying extra money for bad songs that we will never listen to.

Way to go reducing filler (1)

kryten250 (1177211) | more than 6 years ago | (#21534155)

Now with one song purchases we can do away with buying the cereal to get the toy mentality. The busines model can survive but I think the artists are going to be the one to eat it. Sorry Britt Britt.

Beware of Falling Bodies When Leaving the Building (1)

longacre (1090157) | more than 6 years ago | (#21534167)

I work in a Manhattan building whose main tenant is one of the big four record companies. The looks of doom and despair you see on their employees' faces everyday make Milton from Office Space look like Rachel Ray. I think it's safe to assume that the office we sublease from them will add more to their bottom line this year than a new Ashlee Simpson CD.

CD prices (2, Interesting)

Delusion_ (56114) | more than 6 years ago | (#21534177)

CDs started out pretty expensive. I think my first CD was about $30 or so. In the early 90s, new CD prices were going down on a regular basis, to the point where they were making it harder for the used CD shops to stay in business. A lot of large and medium sized labels were able to get their releases out for $9, which made buying a new release a lot easier to swallow than deciding to wait a few weeks for it to show up at the used shops for $6-8.

After a lot of the better used markets started to dry up, what I noticed is that new CD prices kept creeping back toward $20, and some of the shops that used to exclusively sell new CDs started selling used CDs as well... for $12-15.

The Harmony House chain used to be a big deal in southeastern Michigan. As the industry changed, they stopped expanding locations. Eventually, they started closing a few stores, then collapsed to one store for classical and one for everything else. Then they just went to one location. I started making a regular trip to start buying some previously expensive niche label stuff that used to be well over $20 - Mille Plateaux, Forcetracks, Mute, etc. because now they were dumping everything at half price or less.

When I read the articles covering Harmony House's woes, the company spokesmen blamed it on the internet. While there's some validity to that, it wasn't the internet that kept most people away. It was the fact that their stock was regularly overpriced. If CD priced had continued to go down from their low, they should have reached the $5 mark by now.

In retrospect, I wonder how much piracy $5 CDs would have avoided, because I know my purchasing habits started to change from the most expensive releases before reaching the less expensive. Maybe it would have gotten to the point it is today anyway, but I doubt you'd see the level of wholescale consumer rebellion the labels are dealing with now.

The Elephant in the Room (0, Insightful)

Anonymous Coward | more than 6 years ago | (#21534185)

I am a musician and have been for 30 years. Never had a major deal but understand enough about the industry to conclude the end is near.

No one wants to admit it but filesharing is the primary reason the industry is experiencing declining fortunes. When I say primary I do not mean to ignore other factors contributing to the decline of the industry.

      Yes they failed to embrace the technological revolution until too late
      Yes they put out a signifigant quantity of inferior product or coddle losers like Britney
      Yes they are a fat and bloated bureacratic bunch of bungling psychophants
      Yes the ala carte offering on download sites is a factor

        But hands down, the sheer amount of lost revenue to illegal downloading and offshore piracy is surely bankrupting the industry as a whole. The Digital revolution made this possible wheras before, analog inferiority and generational audio loss was the major hindrence.

        The current generation of "fans" if you can call them that feel a sense of entitlement to download anothers property freely. They reason its just a song so whats the harm and if we multiply that times hundreds of millions of downloaders over the course of their lifetimes and what economic model does this serve?

      Ultimately it serves to kill whats good about the music industry as evidenced in its history of discovering, nurturing and supporting/marketing artists worthy of our attention. I am fortunate to have been born in the 60's and to not have been subjected to the drivel that passes for music today. I came of age in the 70's, a decade when the long playing LP was more than just a collection of singles.

      The future (if things remain as they are) will be filled with more of the current crop of talentless music pimps and ho's shouting and wriggling with a microphone and rendering lackluster musical pornography and I dont have problem with that as long as there is more to choose from but I predict there wont be and I prefer true pornogrpahy to the lukewarm tittilation that you find in todays music. I say to britney or beyonce etc. go to porn already!

      The future for music is a Randian nightmare where creativity goes unrewarded and eventually dies on the vine.

      Its happpening now, expect more of the same


Album Experience (2, Insightful)

vacantskies9 (1190171) | more than 6 years ago | (#21534269)

I miss the days when listening to an album was an experience. This was because the artist carefully crafted the album to create a mood or feeling. Many artists would write 40 songs and turn 10 into an album. Now they write 2 songs and fill in the others with generic three chord rock songs about how they once knew a girl and something happended.

I am hoping that the death of the album is a good thing. The last thing we need is another Nickelback album. The death of the current market structure and format can only give the artist more freedom to be creative and that's what I really miss about mainstream music.

Until then, I'll keep looking for those indie bands that get it and keep listening to my King Crimson albums on my headphones.

Put another way (1)

overshoot (39700) | more than 6 years ago | (#21534299)

The"industry" is producing less music that people are willing to pay for. For a while they compensated by bundling music that people weren't willing to pay for, effectively selling a single for $15. Now that customers have alternatives, that isn't working.

Here's a clue: in the long run, you have to give the customers their money's worth. Either charge less or deliver more. ("Dark Side of the Moon," anyone?)

Music isn't on MTV anymore (2, Insightful)

largetalons (986402) | more than 6 years ago | (#21534301)

I grew up in the 80's and 90's when MTV's focus was music and music videos. If they weren't playing a video, they were playing something about a band or the music. They promoted new artists all the time. This is where I heard of all the new artists, along with a lot of other people. MTV was on basic cable, so just about everyone with cable got it. This was great promotion for the record companies. In the last decade (maybe more) MTV started to focus on reality tv. Some has been entertaining, but the more they focused on this, the less people found out about new music. Sure, they'll play videos on their other stations, but not too many people get those. The record companies seem to have lost a great source for promoting new artist. Your local clear channel station is not going to take a chance on a new artist/band like Arcade Fire or LCD Soundsystem.

Here we go again (3, Insightful)

Rik Sweeney (471717) | more than 6 years ago | (#21534311)

"No more albums", "No more filler tracks"

Not all bands write their singles and then pad the rest of the album out, some actually write about 20 songs, select the ones they like the most, and release an album. THEN they choose what songs to release from the album.

It's only the American Idol and other reality show winners that choose the singles prior to releasing the album (most likely because they're covers) and then pad the rest with crap.

I'm sure I'm not the only one who thinks that there are better songs on the album...

Dont hold your breath (3, Interesting)

nurb432 (527695) | more than 6 years ago | (#21534329)

They have a lot of cash, and a lot of strings to pull in washington that will prolong any death to long after we are all dead and gone.
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