Santa Helps Digital Music Sales
Christmas helped push digital download sales to their best week ever,
reports Billboard. Sales of iPods and other music players were a big part, and music execs said sales of gift cards were also behind the spike. How big of a week was it? Four tracks exceeded the previous one-week record set in October by U2’s “Vertigo.” Ciara’s “1,2 Step” took the number one chart position with just under 50,000 sold.
Sales Up, Stocks Up
After a few down years, the U.S. music industry finished up the year in positive territory. CD sales for 2004 were up 1.4%. The stocks of the major music groups, however, fared much better. The stock of Universal Music Group’s parent company, Vivendi Universal, was up 32% in 2004. Sony’s stock was up 12%. EMI’s stock increase, fueled in part by speculation of a merger with Warner Music Group, was 66%. All of this, of course, isn’t quite in the realm of some tech stocks’ meteoric rise (Apple was up 201%, Napster was up 95%) but it shows that investor believe that record labels’ worst is probably behind them.
Vinyl’s Will To Survive
The New Zealand Herald’s
article on vinyl’s resurgence
as a music format was all the more interesting because it pointed out that the country’s last vinyl record-pressing plant closed in 1987. Still, the country is seeing that many others around the world are also seeing: Digital music can’t kill music lovers’ enthusiasm for vinyl records. The Internet is a godsend for vinyl lovers. eBay is basically a worldwide garage sale, and at online stores like
a shopper can find all kinds of rarities that used to be found in those local record shops that are dropping like flies these days. Digital music is the future, no doubt about it, but old habits die hard, don’t they?
The annual Consumer Electronics Show (CES) in Las Vegas ended the other day, and digital music fans got to see the next line of gadgets and services.
Engadget has a CES section
that groups together all its posts from the trade show. For a more Mac-centric view of the show, see
MacCentral’s CES news archive.
Renting vs. Buying
The future of digital music is all about accessing more songs for less money. The storage surplus, brought by increased hard drive capacity in both computers and personal music players, has consumers in a fix. How does one fill all those empty gigabytes without breaking the bank? One option is to subscribe to a service that allows you to download “tethered” files. (Read
this article at AlwaysOn
for a good overview.) These services are predicted by some analysts to overtake a la carte models, but there will be some issues for consumers to deal with. First of all, when the subscription is canceled, so are the songs. Interoperability is another issue. And consumers will want portability, and these subscription services will need to accommodate that wish. Allan Hoffman, a technology writer for the Newark Star-Ledger,
warns consumers to think twice before subscribing. But critics like Hoffman approach these services as if consumers can’t both rent and buy their music.
Think about it: the DVD market is full of consumers who both subscribe to NetFlix
buy DVDs. Music doesn’t have to be any different. A subscription model allows music fans to rent some songs and buy others—probably the songs closest to their hearts. Napster’s tethered music plan, Napster To Go, costs $15 a month. Some,
like Brad Hill of the Digital Music Weblog, think $15 is too much. For serious music fans, I think that’s a good value. For others, it may be best to wait for competition to bring the price down and/or introduce new innovations. Besides, since it’s going to take some time to get consumers used to the idea of renting music, subscription models should have a year or two before they really start to blossom.
Glenn works in the music industry in New York City. He writes about the industry and music in general at his blog,