The Death of The Album?

chart/analysis Michael DeGusta

Before we leave the music industry alone for the weekend, I thought I'd leave you with 2 pictures from the article "The REAL Death Of The Music Industry" by Michael DeGusta. As you can see, traditionally the album floated the music industry's financial boat making up a large % of overall music sales. The trend is obviously shifting.

chart/analysis Michael DeGusta

While overall music sales were strong in 2011 where even complete album sales showed a 1% rise over 2010s numbers (mainly buoyed by Adele’s “21” which sold 5.82 million copies), the bad news is album sales are down from their all-time highs and album sales are where record companies make their highest margins. On the bright side, single sales and digital downloads which appear to be becoming synonymous are soaring to all-time highs (for more on the rosy music sales picture, see "The Sky is Rising").

But if we step back from looking at things from a Music Industry perspective in the USA, things could not be better for music lovers. The Gracenote database has ballooned from 11 million tracks in 2001 to over 100 million in 2011, vinyl sales were up 41% in 2011 and while they still remain tiny as a % of sales, what this number really translates into from a music lover's perspective is there's more new vinyl coming out each week than anyone has the time or money to keep up with. And all of these numbers including the Gracenote database and the ubiquitous Neilsen/Soundscan charts do not represent all music production and sales on a global basis (Neilsen/Soundscan restrict their metrics to US and Canada sales and they do not include many independent record labels who are releasing the most interesting new music especially on vinyl, imo).

And there's more. Sites like Kickstarter, the fan-funding site, has raised $16.5 million, funding more than 3,000 music-based projects since their launch in 2009. While that doesn't seem like much, we're talking about a new means for independent musicians to fund their music and an entire segment of the music business that does not show up in any of the usual metrics. Neither do sites like Bandcamp where independent musicians sell their music directly to fans.

There's more music being made and consumed today than ever before. The real issue in terms of the Music Industry appears to be the fact that all of this growth is not ending up as profits in a few companies pockets. And to answer our initial question, is the album dead?, I'd say no, it just went underground.

COMMENTS
Vade Forrester's picture

Seems like if you wanted to talk about music industry sales in recent years, you wouldn't use graphs whose last data was from 2009.

 

Vade Forrester

Michael Lavorgna's picture

I wanted to talk about music industry sales...And I did. Yes, the graphs only include data from 1973-2009 but you'll notice I talk about music industry sales up to and including 2011.

I also wanted to point people to the article containing those graphs, “The REAL Death Of The Music Industry” even though its from Feb 2010 because it still raises valuable and relevant points.

But thank you for pointing out that out, Vade.

Vade Forrester's picture

Pardon me if I came across as grumpy, but I'd really like to see similar data for 2010 and 2011.

 

Vade Forrester

Michael Lavorgna's picture

I'll look around and see if I can find more recent data on single sales v album sales. My guess is the trend we're seeing up to 2009 will continue but I hope I'm wrong.

One important and related milestone – digital downloads exceeded physical sales for the first time ever in 2011.

From a report on CNN:

According to a Nielsen and Billboard report, digital music purchases accounted for 50.3% of music sales in 2011. Digital sales were up 8.4% from the previous year, while physical album sales declined 5%.

Vade Forrester's picture

I'm guessing most digital music sales were some form of compressed files. 'Twould be interesting to know what percent of downloaded files were at least CD-equivalent quality FLAC, ALAC, WAV, or AIFF files. I'd wager those amounted to less than 5%, if that much.

 

Vade Forrester

pulsetsar's picture

I was in college during the Napster and early mp3 days. Once people could download individual songs and create playlists with the click of a button that they could take with them anywhere, they stopped listening to albums.  It happened very quickly and most people never looked back. 

 

Not that this was a completely new way to consume music and I'm not just talking about mix tapes - when was the last time you heard a radio station play an entire album. Heck, if they play 2 songs in a row from the same artist it's a big deal. 

I love buying and listening to whole albums and this is primarily how I consume music and has been since I was young, but I'll be the first to admit that it's not a common way any longer and never was for many people. I only hope artists still feel there is value in the effort that goes into constructing an album despite this new reality. I'll certainly be listening. 

deckeda's picture

I'm guessing most digital music sales were some form of compressed files.

In terms of reduced sound quality from a "baseline" of LP or CD, it was the rising popularity of prerecorded cassettes that's attributed (in large part) to the LP's demise as the norm. What I'm proposing here is an argument that consumers' willingness to spend money for crappy formats is historically nothing new. I think I need a hug.

 

Albums have been dead for many since the [early?] 1990s.

 

I noticed singles taking over from the graph as well. Why'd I change what you typed? Because I'll never forget when I first saw cassette singles for sale. To me it was the epitome of so-not-caring about the artist or the music that you'd put up with a weaker format AND wouldn't venture a few more bucks to explore what else might be on the album.

 

What did people do? Carry a basket and swap them out in their Walkmans every few minutes? At least with 45s you could get a stack of them (i.e. your playlist) to play automatically with a changer. (Eh, I'm proven wrong again.)

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