04/28/2004, 11:00am, EDT
Wednesday, April 28th
Online music stores signal the return of the single
Selling singles online can still be profitable, stores contend. "Essentially, they send us spreadsheets, we send them money," said Sean Ryan, head of music services at RealNetworks, illustrating how inexpensive online transactions are for the record labels. Customers of Real's Rhapsody service spend an average of $150 a year on music, far above the American average.
Some analysts and record executives believe the shift towards singles again is inescapable. "Consumers have moved on," said analyst Josh Bernoff of Forrester Research. "The idea that they have to consume music by the album is something that many music consumers have left behind." And regardless how the situation is analyzed, music purchases of any sort always trump the free downloads that continue to run rampant on peer-to-peer services.
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Of course offline people buy more albums. Singles in the stores aren't 99 cents each, they're like $3 or something (if you can find them at all). Why spend $3 when for $8 more you can get the whole album (if you're lucky). Its just not fiscally sensible. (Plus, some songs which aren't being pushed as the 'next big hit' aren't available on singles, just on albums, whereas you can get whatever songs you want from on-line, not just what the record companies want you to get).
Oh, and based off the above, I think its even more likely they're going to raise prices for singles (esp new singles) and doing the whole "group songs for a price" thing.
Translation: Most albums we put out have only one or two good songs on it, but we want people to buy the whole thing to get those songs, so we can line our pockets with extra cash. Now, if we want to sell albums, we'll actually have to find less 'one-hit wonder' bands and look for artists with real talent.
I have been screwed by album purchases based on hearing one song too many times. I like picking and choosing.
The future is here but most of the industry is in the past.