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  • irishtimes.com - Posted: May 21, 2010 @ 10:25 am

    New sales figures reveal an industry in perilous shape

    Jim Carroll

    We knew things were bad in the record business, but this bad? Last weekend, the National Association of Recording Merchandisers (NARM) had their annual shindig in Chicago. Music retailers of every stripe schmoozed, supped and sang their hearts out to Cyndi Lauper, Taylor Swift and Melissa Etheridge.

    But it wasn’t all fun and games. Over the weekend, Nielsen Soundscan, the company who collate US sales figures, gave what amounted to a state of the nation address to the gathering.

    Per Soundscan’s numbers, 98,000 albums were released in 2009, with only 2 per cent selling over 5,000 copies. Yep, that’s right, most albums racked up less than 5,000 sales. There was also a sidebar that three-quarters of sales are still physical, but let’s concentrate on the marquee statistic.

    While there is much headline focus on mainstream frontloaded acts like Lady Gaga, Susan Boyle and Justin Bieber, the bulk of album acts just aren’t getting off the block. It was always a given that the majority of acts signed to major labels never went into the black, but most of them could at least shift 5,000 copies even on their very worst day.

    Of course, there are caveats to all of this. There are, for instance, sales which are not counted by Soundscan (ie albums sold at a band’s gigs) and there are also many bands who can quite happily survive and thrive on 5k sales.

    But such a low number means it’s high time for the record (and live) business to realise that there are problems aside from the net slippage in sales. After all, if acts can’t get over the 5,000 sales mark, where are the breakthrough acts and venue-fillers of tomorrow going to come from?

  • 15 Comments

    1.
    May 21, 2010
    11:06 am

    I don’t think it’s necessarily a bad thing that a small number of big acts blend into a generic showbusiness part of the industry through links to TV shows, movies, and gossip mags, while the remaining 98% operate in a cottage industry.

    Breaking a big act these days involves a punishing and exhausting schedule of touring and promotion that invariably ends in tears. Touring musicians are different to movies stars in that they have to present their product in person; attempting this on a global scale, with all the attendant travelling and PR is not sustainable, especially when, in business terms, the unique selling point of the act is supposed to be their creative edge. That’s before you factor in the naive and fragile mindset of the types of people who try to become famous in the first place.

    Comment by Mumblin' Deaf Ro
    2.
    May 21, 2010
    11:06 am

    but on a happier note music is the cheapest it’s been in 20 yrs. Nearly all new release albums are 13.99 or under. maybe once in a while we should highlight the positives and not just the negatives eh?

    Comment by billy lyons
    3.
    May 21, 2010
    11:22 am

    In case you missed all the online hoopla, Arcadefire.com has the new single steaming-ish as a taster. Heard to make anything of “The Suburbs” but “Month of May” is a punk/Springsteen belter.

    Comment by Ivor
    4.
    May 21, 2010
    11:32 am

    Billy – but lower prices still aren’t helping to shift those albums

    Comment by Jim Carroll
    5.
    May 21, 2010
    12:48 pm

    there was an interesting article a few weeks back about beggars group I think it was, in London and how they were actually thriving and selling about 100k of each release with their umbrella of labels, 4AD, XL etc.. but this is a label that had its roots in the late 70s i.e its been established for 30 years. What about labels that have come up in the last 10 years since the genie was let out of the bottle with napster. Is there a relatively new label that is selling this much that doesn’t have stealth funding?

    As jim has said in the past for bands like radiohead that were established over 15-20 years by the muscle of a major label, they have a huge fanbase but more recent bands that have come up since are lost in a fractured, balkanised scene where there is great music but the punter just isnt aware of it.

    Comment by patrick
    6.
    May 21, 2010
    12:50 pm

    Its a ‘perfect storm’ for the music industry: global recession, illegal downloading, kids preferring to spend their pocket money on games or DVDs instead of CD’s. In some ways I have very little sympathy for the record companies. If I look at the prices on the front of the albums in my attic, I was paying 10 and 12 pounds back in the 80’s for albums, a fortune by current standards. People will always listen to music, but it will never be the cash cow for the majors that it was in the last century. Maybe we will see less quantity and more quality.

    Comment by mclovin
    7.
    May 21, 2010
    1:27 pm

    that’s because most people are not aware that music is so cheap. you also have to put things into context – out of the 98,000 albums released last year how many were actually good? How many of the albums would be looked upon in ten years times as classics? the biggest problem this industry has is champion the mediocre – and that’s everyone involved from labels to journalists.

    Comment by billy lyons
    8.
    May 21, 2010
    2:26 pm

    Jim I don’t buy it. You’ve heard the expression “Lies, damned lies, and statistics”? Well I think this is another case in point. What is Nielsen’s agenda here? I say show us the raw data and let us reach our own conclusions.

    Have you seen the increase in new releases, that doesnt suggest the end of the music business..

    2000 = 35516 new releases
    2007 = 79695 new releases
    2009 = 98000 new releases

    Comment by fanning sessions
    9.
    May 21, 2010
    2:29 pm

    Interestingly enough the market that’s sinking most at the moment is the US.
    The UK seems to have generally bottomed out…………..for now anyway.
    I think it is fair to say though that most of the news relating to music sales is very dishearting.

    That said the endless stream of bad news wont stop me (and many others I presume) from releasing records.
    Whether its stupidity or just sheer bloody-mindedness I dunno but fuck it.

    Comment by Bren Jacob
    10.
    May 21, 2010
    2:44 pm

    MDR @ 1 – yeah, “cottage industry” is a good way of putting it and I’ve no problem with acts who see it in those terms. But the point above is to ask if sales are so low, how does this impact on other sections of the business in the future. Less sales now equals less revenue all round in the future for all parties.

    patrick @ 5 – yes, that piece on XL was the spark for this blog post – http://www.irishtimes.com/blogs/ontherecord/2010/04/15/running-a-record-label-in-2010/

    mclovin @ 6 – Billy Lyons above is putting fwd the point that music today is CHEAPER than it was – you obviously don’t agree

    billy @ 7 – I made that very point in the original piece – ie one of the other caveats is that the bulk of the 98k releases are not v good – but it was subbed out.

    fanning sessions @ 8 – increased quantity, sure, doesn’t mean the end of the music business but – and this is the point i’m making above – where will the venue-fillers of tomorrow come from is the vast majority are selling less than 5k a release?

    bren @ 9 – it’s called passion!

    Comment by Jim Carroll
    11.
    May 21, 2010
    3:37 pm

    Does anybody know if there are any stats on the ratio of purchases to illeagal downloads these days?

    For example if i’m in a band that have sold 5,000 albums is there any projected figure on the amount of people who have illeagilly downloaded the record (and hence heard it)??

    I think that could give a clearer picture on the venue filler arguement Jim.

    Comment by Shane
    12.
    May 21, 2010
    4:11 pm

    (I had a long post which i think i lost but never mind.)

    Jim – from the companies’ point of view it is profit rather than sales that matters. A big selling act can still lose plenty of money. The companies looking for venue filling will still be happy to live of the fat of heritage acts playing their greatest hits around the world at incredible prices.

    The point I was making in the post I lost was that they need to be more discriminating in their signing policy, focus on reducing costs and find new markets.

    I should also add that the four main record companies are big boys that have extensive interests in their rival entertainment media. Universal are owned by Vivendi (canal+, NBC, Universal studios, telecoms, computer games like guitar hero); Sony owns MGM, United artists, playstation, sony online entertainment (games); Warner were with Time waner until about five years ago, with HBO, Catle Rock (movies) and made games like Tomb raider; and EMI has extensive interests across the music industry.

    Comment by Mumblin' Deaf Ro
    13.
    May 21, 2010
    4:28 pm

    The point I was making in the post I lost was that they need to be more discriminating in their signing policy, focus on reducing costs and find new markets.

    MDR – I think we’re seeing the first of your points to an increasing degree – the majors now operate more and more like Real Madrid and “buy” in the talent who’ve already built an audience on indies. The reduction of costs is ongoing (as with any business) via decreased headcount, less tour support, cutdown on promo budgets etc. But it’s the “finding new markets” one which will flummox them. The problem is that the agenda setters at the labels have only ever known one way to operate – sign acts, treat ‘em mean and sell the product at the highest price the market will take. Now, that this policy does not produce the same results, they’ve NO IDEA what to do next. They’re looking around at how the indies operate and seeing if they can adopt some of those ideas – and they’re willing to hawk the family silver to any two-bit chancer with an idea which involves various buzzwords (this season’s favourite: “social media strategy”).

    Comment by Jim Carroll
    14.
    May 21, 2010
    9:45 pm

    @Jim ‘where will the venue-fillers of tomorrow come from is the vast majority are selling less than 5k a release?’

    But isn’t it just the consumption habits have changed, it’s not that declining sales means that suddenly there’s less music fans to fill venues.

    Comment by colly
    15.
    May 24, 2010
    8:40 am

    colly – if you have acts who can’t sell over 5k albums, they’re unlikely to become acts who can fill the bigger venues worldwide, regardless of the number of music fans out there. After all, a poor-selling album band don’t suddenly become a best-selling live band.

    Comment by Jim Carroll

    Comments on this article are now closed.


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