Music Sales Are Up ... But Look Closer
March 9, 2012
"The quality of pop music been better recently, from Adele to Lady Gaga to Katy Perry to Susan Boyle, and people are responding to that. And 10 years after the advent of Apple's iTunes, far more people buy CDs than downloads."
-- From 'Music Sales Stage Comeback; CD Buyers Up For Second Year' on The Wall Street Journal's Marketwatch ( Read it here: http://tiny.cc/b4Tf2b )
Yes, the music industry is showing signs of renewed health, and from the above article, it's in part due to the surprising resilience of the CD format, according to a new study by The NPD Group.
But, a closer look can reveal much more.
From the article: "After years of losing buyers, caused by many consumers who simply stopped buying music, the total number of CD buyers increased for the second consecutive year, growing 2% to 78 million [in 2011]."
Anytime there are exceptional sales in the entertainment industry (whether at the box office, concerts, music sales), it's usually because certain events in that year were the primary reason versus the fact that sales increased in general due to people having more discretionary income. For example: Films like Jurassic Park, Titanic and Avatar all drove record box office years because each one was responsible for extraordinary revenues.
This past year, Adele has been the event that has caused so many people to once again buy CDs and spend more money on music. Anytime such an event sparks such big retail, it carries with it a ripple effect, and more people buy more music. It's always been that way. Michael Jackson's Thriller sparked a burst of music retail as more people went to buy the album and picked up other music at the same time. It happened whenever The Beatles and any music superstars reached multi-Platinum success. That's why the industry is always rooting for "a big retail event item" every year.
Of course, there was no Avatar the year after it came out, and there might not be another Adele "21" next year or the year after. So the eight to 10 million units Adele alone sold here in the U.S. (and still going strong) will have to made up by somebody else, or by a rash of multi-Platinum releases to fill in the unit sales. Adele's album is also filled with multiple hits, all great songs, and that's the reason why currently "far more people buy CDs than downloads."
I've said it before (and repeatedly), if the industry wants to regain market share, all it needs to do is continue to put out better albums. Great albums have always sold in quantities. Mediocre albums with one or two hits end up selling song downloads and many of those songs eventually end up on one of the "Now That's What I Call Music" volumes. (Or as I call them, the "When You Have Lemons, Make Lemonade" series.)
The article even states, "In our rapidly changing world, it is perhaps odd to suppose that a physical medium would still resonate with people. However, Crupnick said, there are still plenty of Baby Boomers and other listeners who just enjoy the CD experience in the car, and there remains a core contingent of consumers who find CDs to be the best way to enjoy the album format, which offers an assortment of songs from a favorite artist tied to a unifying theme." (Can I please get a big Homer Simpson "DUH!" here)
The article also states, "One other thing has clearly helped the music industry claw its way back to growth - a decline in piracy. The NPD report also noted a decline in unpaid music acquisition, such as P2P file sharing and trading music on hard drives. NPD estimates that 13% of Internet users downloaded music from a P2P site in 2011, down from a peak of 19% in 2006. In addition to giving customers more legitimate sources to find music, the industry has worked hard to crack down on file sharing sites."
Anybody with the knowledge of what's REALLY going on globally in technology knows that piracy is still rampant, and the ONLY thing that's declined is the number of P2P websites they can track. What the industry cannot (and will never be able to track) are the offline intranets (prevalent among high school and college students), and darknets that fly below the radar screen. Then there's the number of P2P sites that exist and pop-up all over the globe everyday somewhere. Piracy isn't going to go away, but if the industry wants to succeed in light of that fact, they need to hope more artists like Adele will deliver those big sales numbers.
As I said in the newsletter two weeks ago, "The album (Adele's "21") is now over 18 million sales globally. Yup, songs are powerful when sung by artists with real vocal talent. It means that people are actually LISTENING to the SONGS and they don't care about the flashy videos when the songs engage them emotionally. It means that people are very willing to open their wallets and PAY for great music in huge quantities while piracy and illegal file-sharing are still rampant...Yeah. The MUSIC and the SONGS."
THE 'A-SIDE' - TRACK 2
APPLE READY TO CONTINUE TO "BLOW YOUR MIND"... AND WHY NOT WITH GREAT PRODUCTS?
Apple, the company that proves it's still ready to wow consumers -- even without the leadership of Steve Jobs, is still thinking big and looking forward.
Plying some of the salesmanship for which Jobs was known, CEO Tim Cook boasted that Apple has a pipeline of products that will blow consumers' minds. "You can be assured we are working as hard as ever this year to deliver an incredible year and some products that will blow your mind," Apple's CEO said this week at the company's annual shareholder meeting.
Not breaking with traditional, however, Apple isn't saying much about what it has in store. "When a shareholder asked if he should return his new 60-inch television set -- in a nod to recent reports that Apple may be entering the TV business -- Cook laughed, declined to comment and said everyone should consider buying an AppleTV set-top box for $99," Forbes reports.
Read about it on Forbes here: http://tiny.cc/8e4nu
AND...HERE'S THE NEW iPAD
After much anticipation and ballyhoo, the new iPad has arrived.
No, it's not the iPad 3 or the iPad HD, just "the new iPad" (and no, we don't know why they decided to call it that).
Regardless, it's a significant step up from the iPad 2. Forget all of the minor tweaks and incremental updates Apple has made to its third-generation tablet. The faster processor, the upgrade to 4G data, the improved camera -- that's all housekeeping. The real wow factor is the Retina Display, which increases the iPad's screen resolution to 2,048x1,536 pixels, exceeding any current tablet or laptop.
Read CNET's comprehensive First Take and see if it's right for you here: http://tiny.cc/mo9f2b
Apple's new tablet isn't yet ready to push aside the PC, but steady improvements mean ever more computing work will get done on iPads. The tech industry had better jump on board.
Read more here: http://tiny.cc/0bUf2b
THE 'A-SIDE' - TRACK 3
TV VIEWING HABITS (AND SOURCES) ARE CHANGING
According to the latest Nielsen Cross-Platform Report Americans spend more than 33 hours per week watching video across the screens, but how they're consuming content, traditional TV and otherwise, is changing.
Consumers are increasingly making Internet connectivity a priority, 75.3% pay for broadband Internet (up from 70.9% last year):
* 90.4% pay for cable, telephone company-provided TV or satellite
* Homes with both paid TV and broadband increased 5.5% since last year
* The vast majority (90.4%) of U.S. TV households pay for a TV subscription (cable, telephone company or satellite), while roughly three-quarters (75.3%) opt for broadband Internet. That's a lot, and the percentage of homes has remained stable despite a poor economy and a multitude of entertainment options available to consumers. In fact, since last year, the number of homes paying for both a TV subscription and broadband has increased 5.5%.
* Nearly a million more homes are subscribing to broadband while skipping a traditional paid TV subscription. There are 5.1 million broadcast-only/broadband homes, compared to 80.8 million cable-plus/broadband homes and 22.3 million homes that subscribe to cable-plus and no broadband. Though broadcast only/broadband homes comprise the smallest subscriber group, the number of these homes has increased by 22.8% since Q3 2010.
* Though less than 5% of TV households, homes with broadband Internet and free, broadcast TV are on the rise, growing 22.8% over last year. These households are also found to exhibit interesting video behaviors: they stream video twice as much as the general population and watch half as much TV.
* Changes are afoot, however, as consumers seek out the subscription service that makes the most sense for them, says the report. The number of homes subscribing to wired cable has decreased 4.1% in the past year at the same time that telephone company-provided (telco) and satellite TV have seen increases of 21.1% and 2.1%, respectively.
* Whether they're cord-cutters or former broadcast-only homes that upgraded to Internet service, these homes represent a very small but growing group of U.S. consumers. Interestingly, roughly the same percentage of consumers in broadcast-only/broadband homes watch traditional TV, stream or use the Internet as in all cross-platform homes; the difference between these groups falls to time spent on these activities. Even broadcast-only/broadband homes spend the majority of their video time watching traditional TV: 122.6 minutes, compared to 11.2 for streaming on average each day.
For more data from Nielsen, and access to the PDF file of the Cross-Platform Report, please visit here: http://tiny.cc/auTf2b
THE 'A-SIDE' - TRACK 4
WHAT HATH THE iPAD WROUGHT? A GLOBAL PHENOMENON
A new Forrester report projects 112.5 million U.S. adults -- one-third of the adult population -- will own a tablet by 2016, up from a prior forecast of 82.1 million.
On the eve of the expected release of the iPad 3, the report also showed that 61% of people surveyed said they're considering buying the Apple tablet. (There goes their stock again!)
Read the rest here: http://tiny.cc/pl9f2b
THE 'A-SIDE' - TRACK 5
MICHAEL JACKSON'S SONG FILES STOLEN BY HACKERS
Hackers have stolen more than 50,000 music files from Sony Music, including Michael Jackson's entire back catalog and a large number of unreleased songs from the late King of Pop.
Read about it here on Billboard: http://tiny.cc/rj9f2b
THE 'A-SIDE' - TRACK 6
THERE'S JOBS IN THEM THAR CLOUDS
Whether it will happen or not, a new research from IDC predicts that cloud computing will create nearly 14 million new jobs globally by 2015, with revenues related to innovation in the field reaching more than $1 trillion per year.
Download the PDF report here: http://tiny.cc/Bg9f2b
THE 'A-SIDE' - TRACK 7
'TV EVERYWHERE' IS STUCK
"Nearly three years after Time Warner and Comcast Corp. kicked off a drive to make cable programming available online for cable subscribers, the idea of TV Everywhere remains mired in technical holdups, slow deal-making and disputes over who will control TV customers in the future," writes Sam Schechner and Shalini Ramachandran in The Wall Street Journal.
Cable companies also face competition from entities like Netflix -- meaning "a new content garden is growing up outside of cable TV's walls," according to Schechner and Ramachandran. They discuss other problems with implementing TV Everywhere -- "which is a concept, not a specific service" -- in this post, which reports on two recent industry conferences where the topic was on the agenda.
Read the rest here: http://tiny.cc/9e9f2b
THE 'A-SIDE' - TRACK 8
GOOGLE PLAY NEEDS TO DO SOMETHING SPECIAL TO CATCH-UP WITH iTUNES & iCLOUD
The Android Market has been rebranded and redesigned as Google Play. The one-stop media hub mimics much of the multimedia integration and cross-platform access features that Apple promotes through iTunes and iCloud.
Read the rest here: http://tiny.cc/5c9f2b
THE 'A-SIDE' - TRACK 9
THE UNCERTAIN FUTURE OF THE PC
Is Apple right about the post-PC era? Well, in 2011, worldwide PC shipments totaled 352.8 million units -- which translates to a 0.5% increase from 2010 -- according to new data from Gartner. According to Gartner, last year "redefined the landscape of the device market," with more people turning to tablets and smartphones to do things they've traditionally done on a PC, such as e-mailing and Web surfing. But don't count the PC out, writes The Seattle Times.
Indeed, Gartner is forecasting worldwide PC shipments to reach 368 million units by the end of 2012 -- a respectable 4.4% increase from 2011. What's more, Gartner forecasts even more growth by the end of 2013, when shipments are expected to reach 400 million units. "That's good news for a PC industry that's seen its growth slow to a crawl, buffeted by the weak economy and shifting consumer demands, especially in mature markets," The Seattle Times writes.
Still, as Ranjit Atwal, research director at Gartner, warns: "PC shipments will remain weak in 2012, as the PC market plays catch up in bringing a new level of innovation that consumers want to see in devices they purchase." Adds Atwal: "The real question is whether Windows 8 and ultrabooks will create the compelling offering that gets the earlier adopter of devices excited about PCs again."
Read the rest here from The Seattle Times: http://tiny.cc/lOPf2b
THE 'A-SIDE' - TRACK 10
GET READY FOR THE ABILITY TO DOWNLOAD AND TRANSFER DATA AT LIGHTSPEED
IBM said this week that its scientists have developed a computer chip that can move a trillion bits of information a second. (Yes, that's a trillion!)
Read about it here: http://tiny.cc/DHUf2b
THE 'A-SIDE' - BONUS TRACKS
* I told you previously about the coming of the George Harrison Guitar Collection app; now it's here. George was born on February 25th, and one of his favorite guitars was nicknamed "Lucy." If you knew that already, you're probably going to want a new iPad app by Bandwidth Publishing with the George Harrison Estate. Check it out here: http://tiny.cc/xBPf2b
* From The New York Post comes this story about when Steve Jobs first tested Siri: "On the same day Apple unveiled its new iPad HD, Steve Jobs biographer Walter Isaacson revealed Jobs' reaction when the tech whiz was shown a finished version of Apple's voice-activated assistant, Siri. Isaacson said in a conversation with The New Yorker's Ken Auletta at the Core Club yesterday that when Jobs' staff introduced their famously prickly boss to Siri, he "was trying to stump it." "He asked, 'Do I need an umbrella tomorrow?' Siri said, 'Yes, it's going to rain.' Jobs finally asked, 'Are you a man or a woman?' Siri responded, 'They have not yet assigned me a gender,' and Jobs said, 'Yes!' The boss had found an answer that Siri, despite its female voice, hadn't quite figured out yet." (Source: http://tiny.cc/qDPf2b )
* Time to upgrade your ear-buds. Watch the video on CNET here: http://tiny.cc/Ia9f2b
* Read a great article about Bruce Springsteen, why he is still "The Boss," why "The man seems to be picking up momentum in his 60s," and why he still does BIG business: http://tiny.cc/FY8f2b
Short News Items ...
ADELE DIGITAL CHAMP NOW AS WELL:
Adele's "Rolling in the Deep" has become the biggest-selling digital song of all time by a woman in the U.S., and the second-biggest overall. "Rolling in the Deep's" cumulative sales are now past 6.68 million, surpassing Lady Gaga's "Poker Face" (6.62 million) to become tops among all female-led tunes." Rolling in the Deep" is now second among all digital songs, only to the Black Eyed Peas' "I Gotta Feeling" (7.82 million).
LIL' WAYNE SIGNS LIMP BIZKIT:
Lil Wayne says Cash Money has signed rap-rockers Limp Bizkit.
In the iPhone version of a lottery, Apple was ready to celebrate when it reached 25 billion apps downloaded. That milestone was reached when Chunli Fu of Qingdao, China, chose to download the free version of Disney's "Where's My Water?"
HAPPY BIRTHDAY TO FM RADIO:
Say happy 71st birthday to FM radio. The very first commercial FM radio station was W47NV in Nashville, and it began broadcasting on March 1, 1941.
AN ALBUM TITLE THAT DOESN'T EXACTLY ROLL OFF YOUR LIPS:
Fiona Apple has revealed that her long-delayed fourth album will be titled 'The Idler Wheel Is Wiser Than the Driver of the Screw, and Whipping Cords Will Serve You More Than Ropes Will Ever Do.'
JAY-Z FACING SAMPLING LAWSUIT:
Jay-Z is facing a serious legal challenge over the rights to a hook sampled on his 2000 hit "Big Pimpin'." The nephew of Egyptian composer Baligh Hamdy is close to taking the rapper to court, claiming that he ruined his uncle's song, "Khosara, Khosara," and that his family has not been fairly compensated for its use as the lead instrumental motif in the hit.
CEE LO HEADS TO VEGAS:
Cee Lo Green is heading to Vegas, paying homage to another hyper-flashy performer, doing a stint in the Sin City production "Cee Lo Green Presents Liberace" that will keep him busy through September and then after a short hiatus, through much of December.
MONKEES ALBUM SALES UP AFTER DAVY JONES PASSING ...WHAT A SURPRISE ... NOT!
Following the death of the Monkees' Davy Jones on Feb. 29th, the pop group returns to the Billboard 200 albums chart for the first time since 2003. "The Best of the Monkees" re-enters at No. 20 with 17,000 (up 7,808% according to Nielsen SoundScan) while "Flashback With the Monkees" debuts at No. 125 with 5,000 (a gain of 252%). Collectively, the group's albums sold 29,000 in the week ending March 4 -- a gain of 1,265% over the 2,000 copies sold the previous week.
THE VOICE DOES 2 NIGHTS IN APRIL: NBC
Having started its battle rounds this week, NBC's The Voice will expand to two nights for the live shows starting on April 2nd.
EVERY MOTHER COUNTS VOLUME 2:
Model Christy Turlington Burns is teaming with Starbucks to release "Every Mother Counts Vol. 2," the second album to benefit the organization she founded of the same name. The new collection, available at Starbucks exclusively from May 1st to May 29th to celebrate Mother's Day, features a slew of A-list acts, including David Bowie, Sting, Faith Hill and Lauryn Hill. In addition, there are several previously unreleased tracks, highlighted by Coldplay's acoustic "Yellow," Bono and the Edge's acoustic "Origin of the Species," Eddie Vedder's "Skipping" and husband-and-wife team Paul Simon and Edie Brickell teaming on "Pretty Day."
Metallica have tapped NimrÃ³d Antal, the director of 'Predators' and 'Vacancy', to helm their first 3D live concert movie.
The number of U.S. smartphone subscribers for the first time surpassed the 100-million mark in January, according to new figures from comScore
Laura Kaufman, longtime veteran music publicist with more than 35 years in the business, passed away this week. A memorial is being planned for this week.
Robert B. Sherman, half of a fraternal duo that penned "It's a Small World" and won a pair Academy Awards for "Mary Poppins," died Monday in London. He was 86.
Guitarist extraordinaire Ronnie Montrose fought courageously but lost his battle with cancer last week. He recently celebrated his 64th birthday.
Billy Strange, who played guitar for Elvis Presley and Nancy Sinatra and on the Beach Boys' Pet Sounds album, and was a member of the great L.A. session group known as the Wrecking Crew, died last week in Nashville at age 81. Strange had writing credits on many songs, including Elvis' "A Little Less Conversation" and Chubby Checker's "Limbo Rock." He was a member of the Musicians Hall of Fame and the Rockabilly Hall of Fame.
The Music Industry Past, Present & Future, And The Internet I answer questions on EconTalk
I did an interview about the industry and the Internet at EconTalk with host Russ Roberts. Russ is also a professor of economics at George Mason University, blogs at Cafe Hayek, and has written three novels that teach economics. He's also the co-creator of the Keynes-Hayek rap video. (And if your understanding of the economic meltdown that occurred needs to be enlightened, this video will do it)
In the interview we talk about the evolution of the music industry, the impact of the digital revolution, and I give my reasons for believing in the virtues and potential of the Internet in enhancing the music industry. I point out, as I have many times here in the newsletter, that the internet allows numerous artists to make money from their music and it can enhance revenues from live performances by expanding an artist's base. We also discuss the challenges facing record companies and I suggest that the full potential of the Internet as a distribution channel has yet to be fully exploited. There's a lot of ground covered, but based on the comments already posted of those who have tuned in, they've enjoyed it.
Read more about it by clicking here.
Quotes of the week
"Losing Clarence was like losing the rain. You're losing something that has been so elemental in your life for such a long time."
-- Bruce Springsteen, talking about the passing of "The Big Man" Clarence Clemons
"For me David was The Monkees. They were his band. We were his side men. He was the focal point of the romance, the lovely boy, innocent and approachable. Micky was his Bob Hope. In those two - like Hope and Crosby - was the heartbeat of the show."
-- Former Monkee Mike Nesmith, talking about Davy Jones in Rolling Stone
"The older sibling followed the Beatles and Stones and the sophistication of a burgeoning new world order - the younger siblings were still playing on the floor watching television. The older siblings sang and danced and shouted and pointed to a direction they assumed the Monkees were not part of and pushed the younger sibling into silence. The Monkees went into that closet."
-- Michael Nesmith, in Rolling Stone
The B-Side - 'Blips'
THE ONION (www.theonion.com) STORY OF THE WEEK:
Entertainment Writer Has Knack For Making Complex Pop Culture Concepts Accessible To Lay Readers
LOS ANGELES-Lauded by colleagues and readers alike for his lucid reportage, entertainment writer Paul Veist has an unparalleled knack for taking even the most complicated pop culture concepts and making them accessible for those with little or no technical understanding of celebrity matters, sources said Thursday.
"Paul is a master at distilling the essence of convoluted topics such as stars' fashion faux pas and making them comprehensible without using a lot of esoteric, hard-to-follow mumbo jumbo," said People magazine reporter Tia Nadel
Read the rest here and laugh: Click Here.
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