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For The Record (Music Downloads Feature)
Wednesday, 16 February 2011 Written by Rob Burns
For The Record (Music Download Feature)

In December 2010 a second HMV store opened in Cardiff city centre. My limited understanding of big business is based on watching the ‘Who shot JR?’ Dallas episode so this new store opening made me think that HMV was an expanding business. However, in the following January HMV announced that it would be closing 40 of its stores in 2011. In the last few years high street record shops have been threatened by a combination of Internet downloads, supermarket chains selling cheap CDs and online shops like Amazon. This leads me to ask a number of questions: What will be the future for the music format? Is downloading killing the beloved CD and ultimately the high street record shop? Why did it take so long to axe ‘Last of The Summer Wine’ from the BBC schedule? Ok, maybe not the last question.

Former Warner boss Rob Dickins recently suggested that record sales could be boosted by the simple act of slashing the price of albums to around £1. In 2007 Radiohead initially released their album ‘In Rainbows’ on just a digital format and allowed their fans to choose how much they would pay for the purchase. It turned out that many fans chose to pay nothing for the album. However, the initial digital release made more money for the band than the total income generated by the band’s 2003 album ‘Hail to the Thief’. Clearly only an established, affluent band could get away with such a project. It’s worth mentioning that the publishing company and the band’s management were monitoring the average daily price for the initial digital only release and they were prepared to cancel this process if the average price became too low.

ImageSome artists have been very critical about consumers using downloading to buy their music. Rock legends AC/DC will not allow their music to be bought on iTunes because consumers don’t have to buy a whole album; they can choose to buy specific tracks from the album. There is some evidence to support their case: by September 2008 Katy Perry had sold 2.2 million downloads of her hit ‘I Kissed a Girl’ on iTunes but only 282,000 copies of her album. Guy Garvey, lead singer of Elbow, has also argued that an album is a piece of art, not just a collection of separate tracks to be cherry-picked.

However, just like Chuck Norris’ position of king of the action heroes was threatened by Steven ‘Buddhist Policeman‘ Seagal, downloading has a new challenge in the form of music streaming. One of the most popular music streaming applications is Spotify. The application works like iTunes but you stream the music over the Internet instead of keeping the tunes on your computer (even though Spotify does give you the option to download the tunes). This difference means you don’t need to clog up your computer with downloaded tunes. The Spotify application is also portable because it can be used on a number of leading mobile phones (interestingly the list includes Apple’s iPhone). Spotify’s threat to downloading was apparent when its introduction coincided with a 13% decrease in paid downloads.

Still last year’s BPI (the voice of the UK recorded industry) report made interesting reading. In 2009 recorded music revenue went up by 1.2 % from the last year. The report acknowledged a decline in CD sales but it showed that the Amazon, Play and HMV websites still took over 30% of online spending. It also revealed that 3600 supermarkets sold CDs (as opposed to none in 2003) and this is a huge number when you consider that the end of Zavvi and Woolworths led to the closure of 900 record stores. Unfortunately, the supermarkets only sell hit records and this leads to a lack of diversity when it comes to buying music in the high street.

It is beyond doubt that the Internet has changed the music industry and the way in which we can obtain music. Radiohead’s Ed O’Brien has argued that the music industry has got to accept the technological advances in their business model and you’ve got to make music cheaper (for example, using websites and music streaming) in order to compete with the peer-to-peers. However CD sales are not the only form of revenue for music labels because money can still be made through ticket sales and merchandise. For example, in 2002 Robbie Williams signed a contract with EMI in which the company would take a 25% stake and share of profits from DVD sales, tours, as well as the music sales. The record market may be competing with other interests (such as computer games and mobile phones) but the BPI’s 2009 report shows that the public’s appetite for buying music is still out there.
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