Friday, March 30, 2007

Can Apple Save The Album?

Apple is going to try to save the album, but will they be able to?

Will they be able to single-handedly raise album sales when in this day and age people simply aren't buying albums anymore?

Probably not, but what they're doing is a small step for them, that will bring some results in the short term.

They've finally decided that if you have purchased a single off iTunes, and then wish to purchase the whole album (within 180 days), they will credit you 99 cents for each song off the album you had already bought. So for instance, if you had 3 songs already, you'd only be paying $7.02 rather than 9.99. This offer is also retrospective to songs that have been bought in the last 90 days. The "Complete My Album" part of iTunes will remind you of the deadline so if you decide to take advantage of it, you don't have to do the math on when 180 days is up.

As someone who likes to save money, this immediately strikes me as a good thing...until I then also think about how I'd much rather listen to a playlist I've put together than buy and listen to a whole album.

The New York Times puts it well when they title an article "The Album, A Commodity in Disfavor". “I think the album is going to die,” said Aram Sinnreich, managing partner at Radar Research, a media consulting firm based in Los Angeles. “Consumers are listening to play lists,” or mixes of single songs from an assortment of different artists.

Much like my previous blog article mentioned though how album sales in particular genres such as latin music are not declining at nearly the same rate as pop music, rap, R&B, and much of country, where success is related to radio airplay of singles and their popularity. Fans of jazz, classical, opera and certain rock will demand album-length listening experiences for many years to come.

So for those not-as-popular genres, Apple's idea is fantastic. For everyone who likes mainstream music, I don't think it will make much of a difference.

Tuesday, March 6, 2007

Not All Record Stores Hurting..

Sure, record sales are declining across the board for all physical record stores, but there are some that aren't declining as fast as others.

Those would be Latin record stores.

Jose Jimenez from Mexico is one who frequents them. "You listen to the music and start to believe you're back in your country," he said, adding that the lyrics speak about what is going on in Mexico these days and he can relate as well as keep in touch with his home country.

For many Latin Americans like Jimenez, the source for their music -- a cultural bridge between their lives in the U.S. and their homelands -- is the neighborhood Latin record shop. These stores have proliferated in New York's immigrant neighborhoods in recent years and have survived even as the retail music industry that caters to English speakers faces grim prospects.

Digital downloads, piracy, big-box stores and a lack of support for emerging artists on radio are transforming how music is bought and sold, industry experts say. But so far, Latin record shops seem to be holding their own against many of the negative trends -- at least for now. Only time will tell exactly what will happen, and the predictions are not currently in favor of any record store, including Latin ones.

"Latin Americans still have not gotten into the habit of downloading music," said Enrique Reyes, founder of one of the largest Latin music distributors in the country, Miami-based Reyes Musica. The industry isn't complaining about that!

A lack of high-speed Internet connections, unique collections of music and movies unavailable online and a preference for hard copies have kept many Latinos going back to their neighborhood record shops, according to distributors and music retail experts.

Many of the independent Latin record shops also cater to specific nationalities. In the Brooklyn neighborhood of Bushwick, for instance, it's easy to find retailers focusing on Ecuadorian music. Jackson Heights is where many get the latest in "grupera" music from Mexico.

Clark Bensen, the founder and CEO of the Almighty Institute of Music Retail -- which tracks retail sales for independent shops -- said that while his organization didn't specifically focus on Latin music sales, it does appear that consumers of the genre are more CD-friendly. "Latin consumers haven't shifted their listening behaviors as quickly as consumers of other music genres have," Bensen said. Of the 32.6 million albums digitally downloaded in 2006, only 293,000 of those were in the Latin American genre, according to recent numbers from Nielsen SoundScan. Alternative music, in contrast, accounted for 9.6 million of those digital downloads.

Some distributors and experts, though, think the future of independent Latin record shops is bleak. "In general, the sales in what you are calling mom-and-pop are going down," said Leila Cobo, the editor in chief of Billboard Latino. But she said there may be pockets of health among smaller record shops in different cities.

"Not everybody has a credit card, and not everybody has access to high-speed Internet," she said, adding that the future of music sales belongs to digital downloads. "It's a very small percentage of Latin sales," she said. "But I see this as the big growing area." Still, she said if people are looking for a song popular back home, their best bet would be to go to a neighborhood record shop.

Obviously this is a unique advantage of the Latin record industry, but it will be interesting to see just how long they can keep in business.

Sunday, March 4, 2007

More RIAA notices?

The first time around, in 2005, people were sued, people paid, mistakes were made (an 83 year old grandmother being sued for allegedly downloading rap music). The RIAA scared everyone, but ended up shooting themselves in the foot when everyone developed these feelings of hate and the want to download just to spite them.

Last week a list was posted of the 25 universities that most often violate the no-free-downloading policy.

It's not that anyone doubts 14,000 people broke the law, especially now that they're using new software that makes tracking so much easier.

Did USC make the list? Nope. Did they get 20 letters anyway? Yes.

The Recording Industry Association of America (RIAA), on behalf of the major record companies, last week sent 400 pre-litigation settlement letters to 13 different universities. Each letter informs the school of a forthcoming copyright infringement lawsuit against one of its students or personnel. The RIAA will request that universities forward those letters to the appropriate network user. Under this new approach, a student (or other network user) can settle the record company claims against him or her at a discounted rate before a lawsuit is ever filed.

The initial wave of this new initiative launched today will include letters in the following quantities sent to Arizona State University (23 pre-settlement litigation letters), Marshall University (20), North Carolina State University (37), North Dakota State University (20), Northern Illinois University (28), Ohio University (50), Syracuse University (37), University of Massachusetts – Amherst (37), University of Nebraska – Lincoln (36), University of South Florida (31), University of Southern California (20), University of Tennessee – Knoxville (28), and University of Texas – Austin (33). The RIAA, on behalf of the major record companies, will pursue hundreds of similar enforcement actions against university network users each month.

Is this the right way to go about things? Might it be easier and more effective to warn greater numbers of people, as opposed to actually going in for the kill on a tiny, tiny percentage of people? Or even better, quit focusing on something that can't be stopped and put the money and energy into making themselves look better.

They still think they're doing the right thing, even though record sales haven't exactly skyrocketed since they started doing this.

Friday, March 2, 2007

Record Industry, FIGURE IT OUT!

It's really not that difficult, but they aren't getting it. Yes, everyone used to be all about buying CDs because the internet wasn't anywhere where it is today. They used to want and need a physical copy in hand, but earth to the record industry: look around.

Look at what's being marketed and catching on these days. On demand, internet, TV shows like American Idol where the public gets to vote. Right now the public loves concerts and YouTube, not Tower Records.

They say piracy is a HUGE deal, but that's only a small problem. By fighting piracy they are just making the problem worse, the problem that they're failing to recognize that we've all changed and that they need to change if they expect this relationship to work.

Let's compare music with water. Sales of bottled water continue to grow, up 60 percent from 2001 to about $11 billion in revenue last year. Sure, water is essential to life. But you can live without bottled water. You could turn on the tap or stand at a drinking fountain. Sles of bottled water continue to grow because marketing has created a need and filled it the way consumers want.

Those are many things music companies haven't been doing well. The Internet has made distribution easy and yet they fail to accept that fact. Music companies can lower their distribution and manufacturing costs to next to nothing, worry less about order fulfillment or marketing programs for retail-store placement, and focus more on releasing music that people like and keeping the artists happy.

Jobs said the DRM systems are hampering sales because maintaining the systems requires a great deal of investment in technological know-how. His proposal to get rid of DRM is a gutsy one, considering his company has figured out the way to work the current DRM system to its advantage. These new digital retailers that might pop up to sell DRM-free music would be Apple's competitors.

We all realize that the sooner the music business gets healthy as a business, the better, and that we're not trying to be enemies. Figure it out!