Prior to the Grammy’s last night, NBCs Lester Holt, co-anchor of NBC’s “Today,” Weekend Edition, introduced a report concerning the state of the music industry called “Off Key.” Tonight in Los Angeles,” Holt reported, “the music world’s best will be honored at the fiftieth annual Grammy Awards. While the faces will be familiar, the music industry itself is undergoing some of its biggest changes in years. They’re due in large part to new ways that we listen to our favorite songs and how the big labels are struggling to adjust.”
“Having a number one album isn’t what it used to be,” states NBC’s lead reporter Peter Alexander. “Just ask Alicia Keys. Her latest disk topped the Billboard’s music chart last week with 61,000 copies sold – nearly a historic low for a number one album in a single week. She’s not alone. Across the board, albums sales fell 15 % in 2007, the sixth drop in the last seven years.”
Gary Stiffelman, a music attorney, cut to the chase with his comment that “No artist is immune to the reduction in sales. You have superstars that are creeping their way to a million units that used to sell 10 to 15 million.” To the question why, Peter Alexander simply added, because “with 120 million iPods sold since 2001, digital downloads of individual songs are through the roof – Soaring 500% in the last three years. In that same period, CD’s sales of declined dramatically, as listeners prefer hits over to entire albums.
Tamara Conniff, Co-Executive, Billboard Magazine added that “The music business has been completely turned on its head because of the advent of new technology – And it is not easy for anyone to adapt [to] new technology, especially when it’s been moving as quickly as it has been.”
Major record labels such as Warner Music Group and EMI have suffered massive layoffs. Last year’s best sellers included the soundtrack for ‘Kids’ – and the Eagles come back CD collection went straight to Wal-Mart, bypassing the labels altogether. The slump in CD sales is even changing the way major retailers do business. Peter Alexander pointed out that retailer Wal-Mart had even changed their floor space by putting more profitable DVDs and video games where CD’s once were.
To the question, “Where will the industry be in five years from now? Peter Alexander states that “Industry analysts say it’s unclear.”
“While our interest in music may be as strong as ever,” Alexander concludes, “consumers have changed the way they buy.” The report ends with the image of an iTunes Gift Card being handled by an Apple Store Genius Bar representative (shown).
NBC’s report was obviously suggesting that Apple’s iTunes was and is the leading force behind the downfall of the music’s industry’s cash cow known as the album: An unfair marketing gimmick that had been forced on consumers for decades. On that note, Apple is guilty for championing the sale of the 99 cent tune: Long-live Apple.
But is the downfall of the music album what’s really behind the music industry’s ongoing malaise? – Of course not. Is it behind the massive layoffs at Warner or EMI? – Once again, of course not. The real culprit behind the music industry’s malaise rests with pirating. The Timesonline recently reported on U2’s manager Paul McGuiness striking out at music pirates by stating that “Music fans who indulge in widespread illegal file-sharing should have their web connections cut off by internet service providers.” Paul McGuinness, who has guided the Irish group to 150 million album sales during their 30-year career, said companies such as Yahoo! and AOL, should be prosecuted if they fail to prevent illegal file-sharing. Mr. McGuiness was speaking at the Midem music industry convention in Cannes in January.
In that same address, Mr. McGuinness managed to drag Apple’s CEO Steve Jobs into his speech by stating that “I wish he would bring his remarkable set of skills to bear on the problems of recorded music. He’s a technologist, a financial genius, a marketer and a music lover. He probably doesn’t realize it, but the collapse of the old financial model for recorded music will also mean the end of the songwriter.”
Now that’s a problem.
Written by Neo
8 Responses to “NBC Points to the Leading Killer of Album Sales: Apple’s iPod/iTunes”
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February 12th, 2008 at 11:46 am
Yeah…by all means let’s fix this so people have have to buy a whole CD with 70% crap just to get the few songs (or even one song) they want.
And, while we’re at it, let’s force people to buy milk, yogurt and cottage cheese when they just want a half-gallon of milk.
And forget about “stripped down” cars–all cars should have every bell and whistle so that people will be forced to pay top dollar for a new car.
Actually, the next target should be the cable TV and satellite TV industry–both of whom force customers to buy “packages” instead of pricing each channel separately.
February 12th, 2008 at 12:05 pm
Yes, and we don’t ride buggy carts, we don’t listen to radio, we don’t use typewriters, and we don’t buy lp records.
I have no sympathy for these greedy moguls or the unfortunate artists they’ve taken with them. They chose early and vehemently to be unwilling to either accept or cooperate with what the future was bringing.
Sure Napster and iTunes were the instruments used for this downfall, but make no mistake, the labels were the makers of their own destruction.
/
February 13th, 2008 at 10:04 pm
“the collapse of the old financial model for recorded music will also mean the end of the songwriter.”
What a load of crap. The quality of lyrics in general has taken a giant nosedive since the onset of the album. In the day of the ’45, lyrics were better. And since iTunes came out, more obscure artists than ever are getting the chance to be known b/c they don’t need to depend on a label, whose prime concern is coming up with the next pulp Brittany act they can foist on legions of 15 yr olds. iTunes is probably the best thing to happen to music in 30 years. What would be a step better would be an online market place where anyone could post a song and sell it for .99 and get a .60 split off the deal, something easy to use, something like, well, an expanded itunes.
February 14th, 2008 at 4:14 pm
How does Yahoo get given responsiblity for file sharing? Anyway, anyone thinking they might be swayed by thse silly arguments from industry dinosaurs would do well to read up on how the big labels treat their artists.
In particular, the idea that people will stop writing songs is utterly ludicrous. These business people have a very bloated opinion of their role in music. Music is older than civilisation itself, older than money, and people will continue to make it, indeed we will thrive all the more once these parasites have been vanquished.
Here are a couple of links to start with;
http://www.negativland.com/albini.html – A detailed essay about how the industry operates, and how it cons artists into signing bad contracts.
http://archive.salon.com/tech/feature/2000/06/14/love/Courtney Love redefines music piracy and blasts the RIAA
For the overwhelming majority of musicians, who barely can make a living any more, there is now a chance to get a slice of the pie that has been locked up by a few giant corporations. Foe music lovers there will be the opportunity to easily find a huge variety of music, pay only for what they want, and not have to pay stupid prices for it.
February 14th, 2008 at 4:15 pm
Very sorry, sloppy typing:
http://archive.salon.com/tech/feature/2000/06/14/love/
February 14th, 2008 at 9:46 pm
Paul McGuinness is one to talk. He and U2 in essence didn’t pay taxes in Ireland for 20 years on the majority of their income due to a tax law that was intended to help, to quote zek “(an artist) who barely can make a living.”
As soon as the Irish tax law was changed capping the tax-free exemption, they moved their base of operations to Amsterdam where they would receive a similar tax exemption.
How many tens of millions of dollars were stolen from the people of Ireland by their hometown heros?
Sir Bono, a three time Nobel prize nominee, Time’s Person of the Year, Humanitarian and thief.
“U2 Ltd. said it paid nearly $1.1 million in 2006 tax to Ireland, compared to just $46,500 in 2005.
The increased tax bill in 2006 reflects U2′s sudden exposure to taxes on royalty income in Ireland. Last year the government — stung by criticism that its traditional tax-free status for artists was not intended to support multimillionaires like U2 — capped the tax-free benefit at $360,000 annually.
Within months, U2 relocated its corporate base to Amsterdam.”
http://tinyurl.com/3be8k3
Whose worse, a college student stealing a ninety-nine cent song from a few millionaires or a few millionaires stealing ninety-nine cents from ten million college students?
February 25th, 2008 at 8:58 am
I wonder if the focus is in the right place. Take the excellent ‘U2′, one of my favorite bands, as an example. Why do they still get royalties for something they did 30 years ago? As any other creative person: an artist, an architect, a landscape architect, all of whom work in a commercial world, and all of whom are paid one time for their efforts. No residuals, no music industry barons.
It’s a deeper issue than first appears.
February 28th, 2008 at 3:30 pm
An architect is paid to create the design of a structure and generally oversee that project through to ensure it is built to their specs/design. Then they are done. If a book writer or music artist prepares their material for sale I see no reason, if their contract was to receive a portion of every sale of that work, why they can’t receive that portion 30 yrs later when it is bought. I’m still on the shelf on the radio airtime residuals as part of me feels its like they are getting paid to advertise. How is it different than me creating the next best comb and selling a whack of ‘em but end up sitting on a warehouse full of ‘em for 10 years then finding I have a new group of consumers to buy my comb. Am I supposed to say too much time has passed it’s now free?