boycott-riaa.com - Article: Time to Face the Music

Time to Face the Music

Posted by Bill Evans on December 29, 2002 at 5:32 PM (printer friendly)

Universal Music Group
* U.S. market share: 28.9%

Warner Music Group
* U.S. market share: 17%

Sony Music Entertainment
* U.S. market share: 16.5%

Bertelsmann Music Group
* U.S. market share: 14.8%

EMI Group
* U.S. market share: 9.3%

Independent Music (From Soundscan)
* U.S. market Share 13.2%

The LA Times ran an interesting article today on the state of the Music Business. The title is very appropriate "After a Rocky Year, Time to Face the Music"

The article discusses the state of the various major labels, their continuing declining sales, profits and market share for each. Once again piracy is listed as a major cause, and I'm actually prepared to admit that probably is the case. Before you freak out, hear me out. In the world before file sharing, you only heard one song from an album on the radio, if you wanted to hear the whole album you had to buy the CD. As a result there were a fair number of sales that took place "in the blind" so to speak. Now with filesharing, that is no longer the case, you can listen before you buy. Once the buying public hears just how bad, how over produced, and over engineered a lot of the major label albums are, they decide not to buy. That is how the buying public is using filesharing to lower the sales, and I suspect is probably a larger percentage of users, than those who decide to just download and never buy.

The bright Point is that Independent Music is now selling more than one of the big five. This is great news....This year EMI, 2003 Bertlesman.

LA Times Article (free registration required)

User Comments (These do not necessarily reflect the beliefs of this site)

airider
Date: December 29, 2002 @ 8:11 PM
WOW, after reading the details from this LA Times article, I can see the music industry is really being hard hit, not only from some decrease in sales, but also from poor management and bad deals coming up to bite them in the ass. Warner's the only one showing a profit, and low and behold did it by slashing costs and maximizing value from it's existing assests. Talk about business 101. I agree that the "try-before-you-buy" downloaders have made a dent in the sales, but the music industry has to realize that we're sick of "buying in the blind" as consumers. Lord knows I have plenty of CD's that I never listen to since they have only one good song. So what does this all mean. It means the Music biz will have to start putting out quality work, sell it for a competitive price, and cut the fat out of their business if they want to survive. Also, they'll have to live with lower overall sales since consumers are more informed about their purchases. This means they'll have to make more from less sales, which means cutting the fat again. Clearly good records by quality artists are selling well. Eminem (not necessarily quality) 7.4 mil, Puddle of Mudd, No Doubt, Sheryl Crow, Shania Twain, etc. all platinum sellers. Good products sell, bad ones don't and the internet consumer has the means to tell a good product from a bad one. Maybe it's time for the independents to take over. It'll be interesting to see independents take off. They have the advantage of controlling their costs more readily, can offer better deals to artists and still make money. Will open up the local radio market with new and more music (if the damn radio stations would give them air time), and could possibly open the distribution channel to other independents via the internet. A network of independents could all distribute each others work, yet still minimize costs by keeping their operations small an efficient since the distribution would only require one independent to send the music to another to handle sales in it's area (obviously for hard copy CD's only since the web would still be the main channel of distribution for consumers). I guess we'll just have to wait and see.

goldenpi
Date: December 30, 2002 @ 12:41 AM
The effect of downloads on music sales is hard to estimate. Its much easier to see that sales are now falling because of competition with DVDs and games. There is only so much money people will spend on entertainment.

The independants can try, but the problems the large labels have will affect them too.

(classic FM is doing a mozart special. Now this is music I would consider paying for.)

ChillinBuzz
Date: December 30, 2002 @ 1:19 AM
How well has independent music done over the last few years compared to the big guns? Was it a sudden leap or has it been building up slowly?

Mediamaster
Date: December 30, 2002 @ 6:12 AM
I agree with the article. I am also ready to accuse pirates. Obviously, they are not the only suspects of falling profits, beyond the major records attempt to make music look good rather than sound good, there is the fact that people will buy less if they no what junk is on a CD today. Also, the records have not recieved support from the public because of their constant law suits to individuals and their immpossible copy protections that have made buyers frightful purchasing CD's for fear that they may have to return it.

However, I have no sympathy for the Major Records because now it's time for us to scr-- them.

Hail Mp3!!!

StephenHinkle
Date: December 30, 2002 @ 12:29 PM
Reasons I think the music industry is suffering. In many cases, I think the reasons are a lack of consumer confidence in them, and the real truth of the labels greedy business practices:

1) Internet created a demand for indepedent and unsigned bands

2) Not very much variety of music on the radio, especially with radio giants such as Clear Channel dominantaing everything.

3) Alienating consumers with high CD prices, the truth about artists not getting paid hardly everything for their record sales.

4) Very bad handling of online music. By filing huge lawsuits against Napster, Scour, MusicCity, KaZaa, Grokster, and AudioGalaxy, it caused more outrage and backlash from consumers. Instead, they should have worked with these companies, to put their entire catalog on the web in MP3 format at a reasonable price, like a dime per track, or something.

5) Threats and shutdown of Internet Radio. With the demand for high webcasting fees, it caused a backlash from consumers. Many companies were threatened and sued because of this including AM/FM Simulcasts of numberous stations, xAct, Launch, MTVi, Live365, college stations, just to name a few. In my opinion, webcasting was helping to promote artists.

6) Lobbying to take a users "Digital Rights Away". This is scaring most computer users. Some of the proposed laws would severly restrict what users can do with content on their computers (such as requiring hardware DRM). In addition, many of the labels subscription services use encrypted formats that are copy protected, and not CD burnable without paying extra fees. This makes consumers feel like criminals doing their everyday things, they used to be able to do.

7) CD Copy Protection. People do not want to buy CDs that will not even PLAY on high end CD players, DVD Players, Personal Computers, Macintosh Computers, and Digital Video Game consoles. In addition, most people like to make "fair use copies", and be able to load the music on their computer. What's worse, is the labels did not even warn the consumers that these copy protected disks are not standard CDs.

8) News of investigations into big companies. When this "corporate fraud" news came out about Enron, people started to investigate other companies too.

9) The downturn in the US Economy. I bet the economy in a downturn drove down sales, because wages are being cut, and there have been job layoffs at many companies, and a lack of confidence in the stock market.

Ramamageesh
Date: December 30, 2002 @ 12:31 PM
I have a point to make with respect to airider's comment that "try before you buy" downloaders have made a dent in sales.
One other thing that has come to light in the last few years is being able to preview albums at the store before you buy them. This is something that is also relatively new, but may also contribute to the record companies' downward spiral.
I agree, airider that the music business will start having to market quality music again because with either piracy via the net, or free previews in the record stores themselves, we are no longer "buying blind".

kevos
Date: December 30, 2002 @ 2:56 PM
the bands have also gotten worse (in my opinion), there are a lot of 'one - hit wonders' now. maybe they should sign some better and real bands/singers

goat1974
Date: December 31, 2002 @ 10:12 AM
My music buying is down this last year because of the following.

1. out of work for five months

now that I am working...

2. overplayed, overproduced, no talent, copycat, so-called music.
3. threat of copy protection.
4. overpriced CD's

Since the first item has been taken care of I have bought a few CD's, but not any mainstream "top-40" ones. Get rid of items two and three, which deal with my iterest in purchasing the music and my ability to listen to the music and the music industry may get more sales from me. Lower prices to reasonable levels and you may get more sales from me. Shania Twain's new CD for under $10US at Wal-Mart is a good example.

raiders757
Date: January 4, 2003 @ 3:24 PM
It really never proved that pirating is the cause. It only showed me thier not making the money they expected. Maybe if they put some decent music out, it would change. Maybe if they stopped alienating rock, jazz, real metal(not that wrapmetal or hair crap),blues, real country music,and classical music fans, things would pick up a bit. There's more out there than just **it Hop, crossover bands, R&B, and wrap metal. I stopped buying music long before any Napster existed. I stoped buying music because I thought the record industry was turning thier backs on the bands and the fans of the music I most enjoyed. I was, and still am, tired of seeing no talent dance school stundents, and wannabe actors prancing around on my TV, calling them selves musicians, shaking thier asses, and destroying peoples true perception of what musical talent really is. Sick of seeing country music, even though not at all my fav, being turned into toned down flashy rock acts with a twang. Tired of morons like Eminim(and all those like him) influencing are kids into being ignorant hoodlums. Why should I line thier pockets with my money, if all thier going to do is go and invest into the dumbing down of America. Untill the RIAA starts supporting MUSICIANS, instead of wannabe actors, models, and dance instructors, I won't be buying any music any time soon. A lot of people feel this way, not just me. Enouph of the bubblegum and Hip Hop already! It's being forcrd down our throats to the point of madness. More people listen to rock music than any music, yet it is the least promoted of all. Rock stations have been turned into top 40 wrap metal stations. Rock music fans used to purchase more music than any other genere of fans, so why the kick to the curb? I guess they fooled themselves with that phoney billboard chart crap, and now the payoff is starting to begine. The RIAA abandoned us, and we will abandon them.

Mookrit
Date: January 5, 2003 @ 6:14 PM
This is so complicated.
My head hurts.

Mookrit
Date: January 5, 2003 @ 6:16 PM
They should just take it as competition, now we are ensured of having high calibre artists because they have to make the cut, after being heard by the Internet bootleggers. Even after that, if they manage to sell millions, then we know they rock majorly.
Regardless, most of these "artists" have so much commercial backing they would manage to sell anyway!

dom4
Date: January 8, 2003 @ 1:00 PM
Why is it so hard for the 'pirates' to see that thanks to their theft- in 5 more years the ONLY music in stores
will be Britney Spears and Pdiddy-
REAL musicians and bands will no longer get ANYTHING for all their hard work-since as soon as they sell a single album- some little a***** will put it on the web for everyone to steal! Its hard enough already to make ANY money, and now somehow, THEFT has
become....'o.k.?

here4evr1
Date: January 25, 2003 @ 2:44 AM
Everyone has a special talent for SOMEthing. I see absolutely NO reason why composers should feel that THEIR talent is worth millions. The only difference is that the public tends to idolize people in the entertainment industry. This,in turn, creates a system of false/inflated demand. Yet, I feel "ripped off" when I buy a $20 CD and find out that it has only one decent song. Maybe if the record companies would "pull their heads out" and lower the prices, I would buy more CD's. I imagine Ford makes more money selling "Escorts" than Lamborghini makes selling "Diablos".

here4evr1
Date: January 25, 2003 @ 3:11 AM
This is for dom4. Don't expect to "snow" me into believing that "exploiting" a musical talent that you already have is hard work. I believe that musical production should be thought of as a "side" job...not a career choice. I work for a living, so should you.