THE GOLDEN YEARS – ARE THEY OVER?
For those who created intellectual property during the golden years of the 90’s, that time is a distant memory. Yet the music, book publishing and photography industries are still reeling from the changes digital and instant internet access have made to their pricing models. Witness Border’s bankruptcy if you want to see the carnage.
Here’s a graph generated for music sales from 1973 to 2009. CD sales have been plummeting. Not shown are recent vinyl sales which are up 40% for the first half of 2011, although LPs remain a niche market. Digital downloading seems to be the answer for those who prefer not to have a physical format. Yet even this intangible non-asset isn’t a big money maker (yet). Here are some comments by Bob Lefsetz on the subject:
“We’re never going back to high prices, that paradigm is dead.
We’re still dazzled by technology, but we expect it to be cheap soon, if not immediately. Now it’s all about mass adoption out of the box, and then the price goes down to commodity level.
The odds of a new expensive music format coming down the pike are nil. But we can learn from the computer and mobile phone industries, everyone needs to consume/pay for music, it’s just about making the proposition attractive and cheap enough.
In other words, we shouldn’t be talking about driving the price up, but down, to gain instant and mass acceptance. As for MTV breaking acts… Ratings were always horrific, but the cumulative audience and the channel’s monopoly in a limited music universe are not easy to replicate, but not impossible. It’s about building a music exhibition/discovery site that features thrilling music.
At the advent of the eighties, the dawn of the MTV era, music was exciting, as it was at the dawn of the twenty first century, with Napster, everybody was talking about music, it was on the cover of “Newsweekâ€, now everybody’s on Facebook and young kids want to grow up to be Mark Zuckerberg instead of Boy George or Simon Le Bon, because Zuckerberg does it his way, by inventing something new we didn’t know we wanted. How long has it been since music has delivered this?
In other words, the CD era was an anomaly, not to be replicated, and to continue to try to prop up this paradigm is economic death. They just have to look at Kodak to see the fallacy in this game. Everybody said digital photography was coming, and finally it did, killing the film business, killing Kodak. But people are shooting more images than ever, we’re living in the midst of a photographic explosion, we’re living in the midst of a music explosion, just because there’s presently less money in the sale of recorded music than previously doesn’t mean there’s not a ton of money to be made in music.”