Music Industry Thoughts

Martin Brinkmann
Jan 5, 2008
Updated • Nov 30, 2012
Music and Video

I could not sleep well yesterday evening because I was thinking about the Music Industry which was directly related to the article I wrote on that day. I was to tired to pen it down but I would like to try and recap my thoughts. We all know that album sales are down and that it will most likely stay that way. I thought about the reasons for this and came up with the following.

The last big innovation for the Music Industry was the CD and that is where they are stuck with. They cling on that CD no matter what and fail to realize that there another revolution and a shift that has happened in the last years. It's called digital music. They do not want to accept that digital music will be the successor of the CD.

And digital music has it's own laws that you have to cope with. You can't just copy the marketing and business models that worked so well with the CD to digital music. Not working for several reasons. First is all digital music can be downloaded from the Internet without paying a cent.

That's a major competitor to online sales. Instead of fighting it they should find ways to compete with it and make their digital music more attractive. It is just not explainable why a digital download costs almost as much as a CD that you would purchase in store.

Second there are lots of sources for free music on the Internet. You can listen to Internet Radio which is probably the only source that is also available in the CD world. But, the Internet offers so much more and everything is just a click away.

You get personalized portals like where you can listen to any artist known to mankind, you can download free albums from sites like Jamendo which have some incredible works there, you can listen to personalized Internet Radio with Pandora, you can listen to all the music and view the videos on Youtube, you can rip most of the music without much efforts..

All of this is competition and the Music Industry has to face the facts. They can't just ignore what is happening and hope for the best. It's adapt or die in my opinion.


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  1. VintageP said on January 6, 2008 at 3:53 pm

    Yes, the business model is outdated. The industry thrived for decades selling a physical product. This is now a virtual product given the characteristics of the Internet.

    The problem for the industry is the physical product has a much higher profit margin due only to scarcity. You can only get it in a physical form from them.

    Digital (virtual) music does not have the limitations of the physical product as you do not need a distribution system; it is already there and called the Internet. Since digital is ubiquitous, they cannot charge a scarcity premium.

    Thus, the industry is left with defending what is still a cash cow until they can figure out an alternative.

    Music is still a unique product, just with low distribution costs. They have to find other ways of profiting from the unique product other than a scarcity premium.

  2. Josh said on January 6, 2008 at 2:01 am

    Being a musician this has been well known.

    but why stop selling CD’s when they still sell??

    the other option that has come into place is the USB stick. some artists have sold their recent albums as a USB stick format. and why not? its digital, but you still get the physical object when you buy. (which people still want.)

  3. Quasimodo said on January 5, 2008 at 3:36 pm

    This all has been said for the last 10 years over and over and over again.

    The fact is, the music industry DOES NOT LISTEN.

    They literally go over corpses to enforce their outdated business model on the world, no matter the collateral damage (privacy, democracy, freedom, due course of justice).

    Conclusion, they DESERVE to die.
    Let them …

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