As a nice follow-up to my sequence of posts on the recording industry and the Performance Rights Act, there’s an interesting finding by Peter Kafka at All Things Digital today which reports that CD sales make up about 65% of the music industry’s per unit sales, which would still mean that CDs account for a vast, vast majority of industry revenue – in fact, anywhere from 10 to 20 times as much, since CDs retail for around $14.99 or more.
In theory, this would seem to squelch my earlier insistence that the music industry should return to a single or EP method of record production, for if the CD is still alive, who’s to complain? Yet if we follow the earlier supposition that “album sales are about half of what they were in 2000,” Kafka’s finding makes the state of full-length albums all the more perilous. Apple’s iTunes Store wasn’t created until 2003. If 35% of current per unit sales are attributed to digital downloads (read: singles), with a whopping 25% of that owed to Apple alone, that 50% decrease in sales is owed almost entirely to the encroachment of new forms of music distribution (note that the New Yorker quote says that “sales” are down from 2000, not that revenues are). Where the RIAA and its affiliates find room to complain is that a drop in sales is still a drop in sales, and here it’s a drop in the industry’s single most profitable source of revenue. This would be like if a bakery made cookies, but people only wanted to buy the chocolate chips. Sure, the store could still find a price tag to stick on individual chocolate chips, but they’d still have to go through all the effort of making whole cookies for that minority of customers who weren’t Atkins acolytes or whatever.
What I’m proposing is that the supplier just leave out a bowl of chips and let people make their own damn cookies.
[Later – Also, for anyone interested, you can track further permutations of this story by following http://twitter.com/Free_radio]