The music industry at least the part of it that records and sells music is in a depression.
Tower Records shut its doors a few months ago. The Wall Street Journal last week reported that sales of legal music downloads the supposed savior of the industry did not increase fast enough to offset the surprising 20 percent slide in CD sales in the first quarter.
I haven’t shed a single tear. The recorded music industry has operated with that special brand of hubris that comes from those who rig a monopoly and think the resulting riches are their birthright.
I’d bet a pristine “Meet the Beatles” album that just about 100 percent of music consumers always hated the fact that they had to spend $19 to buy a CD to get one or two good songs buried among the unlistenable tunes in the rest of the album.
When Napster came along in 1999, music consumers finally had a way to get individual songs. And they were free, to boot (or to bootleg).
The record industry could have responded in a positive way. It could have recognized that technology obliterated its old business model. It could have put out individual songs. It could have chopped its prices. It could have embraced the new technology and found a way to profit from it. But no. The Record Industry Association of America declared war on Napster and its customers. Sure, the RIAA had some initial successes, essentially killing off the early version of Napster. But the industry should have recognized that it could not put the genie back in the technological bottle; what Napster did is relatively easy to replicate. Indeed, replicas have proliferated in recent years.
And the RIAA, having persecuted kids who downloaded in their bedrooms, hasn’t exactly endeared itself to its customers. (Early this month, one student blogged about the difference between the RIAA and the Ebola virus: “I’d rather have Ebola in my dorm room than anyone who works for the RIAA.”)
There’s a conclusion the industry should draw from the new numbers that show legal downloads haven’t been as great as hoped: Customers still find the prices too high, even at a buck a song and $10 an album. Especially if they can still download a lot of music for free.
Once again, the industry could respond in a positive way. It could chop prices for downloads. A quarter a song and $2 for an album might be more in line. Heck, they could sell CDs for a buck each and still make a profit. Don’t bet on that happening anytime soon. Although I would bet that it will happen eventually.
The RIAA claims it represents the interests of the recording artists against the deleterious effects of the new technology. Funny, but many recording artists are doing just fine, thanks to the new technology. Interest in music has been heightened and new and lesser-known artists are more able now to connect directly to customers. They should be able to thrive so long as they think creatively. Maybe their music is a loss leader, a portal that compels fans to buy their merchandise or concert tickets and the like.
The ones more likely to be hurt are the ones in the middle, the ones who fought a rear-guard action against onrushing technology and the ones who keep roughing up the customers. To them I say, good night and good luck.
Charles Crumpley is editor of the Business Journal. He can be reached at [email protected].
