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Record Label Thrives Selling CDRs
n3hat writes "'The major music companies may fret over falling revenue, but one label saw its business jump 33 percent last year -- thanks in part to the recordable compact discs that the industry says are hurting its sales. The label, Smithsonian Folkways Recordings, is using recordable CD's, or CD-R's, to ensure that each release in its extensive catalog is always available'."
Link
Smithsonian Folkways Recordings ordering information
The solution that has worked best for me...is to avoid public discussion. -- CmdrTaco
I don't need the karma, but people might find this useful, which is why I'm leaving the bonus on.
Smithsonian Folkways Dusts Off Titles With New Technology
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Oh my bad. They had 13,467 sales of music on CDR. The items the article listed were TIMELESS classics such as:
The Folkways inventory includes 2,168 titles dating to 1948. Some of those are collections by familiar troubadours like Pete Seeger and Phil Ochs. But many more are obscurities like "Music From Western Samoa: From Conch Shell to Disco" (1984) and "Folk Songs of the Canadian North Woods" (1955).
Most of the people would were alive when those were popular are thankfully dead.
Some folks seem to be "getting it". This is a great way to make older material available without running a huge batch of CD's and liners. There was also a recent story (can't find a link!) about concert venues making burned CD's of live performances available while people are on their way out, which is a fantastic idea.
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Pressing CD & DVD Discs
Stampers are used to create replicas by moulding, but there is a lot more to making CDs and DVDs than just moulding.
CD and DVD discs are made by first moulding using stampers produced during mastering and then metallising and lacquering (CD) or bonding (DVD). The steps are:
* Injection moulding of the clear polycarbonate discs using a hydraulic moulding machine
* Metallising to create an aluminium reflective surface
* Lacquering to protect the reflective surface of CDs ready for printing
* Bonding of 2 substrates to produce a DVD disc
* Printing of the disc label on top of the lacquer.
for more info, try this Google Search
"I'm probably being cynical, but I wouldn't be surpised if the tax deductions were more valuable to the company than the money spent pressing and storing the extra CDs."
:) There is no wrangling involved, just normal accounting. The cost to produce your product, regardless of how many items you sell, is your cost of goods sold (CGS). It's all tax deductible. That's how it works for any business that sells things. For a service business, CGS is typically the salaries you pay to your professional staff.
Just a bit cynical
When it's all said and done, excess inventory means your costs were too high and you won't make as much money, so I don't think they would like it.
Bill Clinton: Pimp we can believe in. - The Shirt!!!
The quoted lifespan of a good quality CD-R is 100 years. I'm always suspicious of number like that, since they obviously haven't had a chance to leave one sitting around for that long, but they are supposed to be one of the best digital media in terms of lifespan. I wouldn't be at all surprised if the discs lasted long enough that they were still good long after it was no longer possible to buy a player that could understand them.
There's no point in questioning authority if you aren't going to listen to the answers.
There's another big advantage to this sort of just-in-time manufacturing. There was a Supreme Court decision in 1979 that changed the publishing industry, known as Thor Power Tools. In brief, it makes it more expensive (taxwise) for publishers to keep books (or CDs) in a warehouse. So they are motivated to pulp them much sooner than was the case before Thor.
So print-on-demand schemes like this are probably the future of publishing, and it'll likely happen quicker with music than with books, because the traditional CD is a less-entrenched cultural artifact than the traditional book.
Also, other economies are possible. It would be much cheaper to send the files out to music stores and burn the CDs at the store. Much more efficient shipping model.
For example:
http://www.nytimes.com/auth/login?URI=http://www.n ytimes.com/2003/02/17/business/media/17FOLK.html
becomes:
http://archive.nytimes.com/2003/02/17/business/med ia/17FOLK.html
Alternatively, click here
Modest doubt is called the beacon of the wise. - William Shakespeare
February 17, 2003 Smithsonian Folkways Dusts Off Titles With New Technology By CHRIS NELSON
he major music companies may fret over falling revenue, but one label saw its business jump 33 percent last year -- thanks in part to the recordable compact discs that the industry says are hurting its sales.
The label, Smithsonian Folkways Recordings, is using recordable CD's, or CD-R's, to ensure that each release in its extensive catalog is always available. And in doing so, the label best known for dusty recordings by Woody Guthrie and Lead Belly is taking initial steps toward creating a 21st-century "celestial jukebox," where nothing recorded ever goes out of print.
The Folkways inventory includes 2,168 titles dating to 1948. Some of those are collections by familiar troubadours like Pete Seeger and Phil Ochs. But many more are obscurities like "Music From Western Samoa: From Conch Shell to Disco" (1984) and "Folk Songs of the Canadian North Woods" (1955).
Most recording companies, if they would ever release titles like that to begin with, would let the master tapes languish once a first pressing was sold out and initial interest had waned.
The notion of any recording falling into history's dust bin was said to gall Moses Asch, founder of Folkways Records. Dan Sheehy, director of Smithsonian Folkways, recalled that Mr. Asch used to ask if Q would be dropped from the alphabet just because it wasn't used as much as the rest of the letters.
When the Smithsonian Institution bought Folkways from the Asch estate in 1987, the museum agreed to keep every title in print. Initially, requests for rare, out-of-stock albums were fulfilled with dubbed cassettes.
Now, music fans hankering for "Burmese Folk and Traditional Music" from 1953 can pay $19.95 and receive a CD-R "burned" with the original album, along with a standard cardboard slipcase that includes a folded photocopy of the original liner notes.
The Recording Industry Association of America, a trade group representing the major music corporations, worries that CD-R technology aids music piracy. Rather than buy new CD's, the theory goes, people will burn downloaded music onto CD-R's or burn a copy of a friend's CD.
In 2002, 681 million CD's were sold, down from 763 million the year before, according to Nielsen SoundScan. But Smithsonian Folkways Recordings has been using the CD-R technology since 1996 to sell its obscure titles, essentially creating a just-in-time delivery model for record companies. Every time an order comes in, a Folkways employee burns five copies, one for the customer, and four for future requests.
Last year, the company sold 13,467 CD-R's, accounting for 6 percent of its CD sales, said Richard Burgess, director of marketing. Over all, Smithsonian Folkways had net album sales of almost $2.9 million in 2002, up 33 percent from 2001, despite its cutting its advertising budget more than 50 percent.
Interest in Smithsonian Folkways has jumped since the bluegrass-flavored soundtrack to "O Brother, Where Art Thou?" (2001), from Universal, won a Grammy for Album of the Year and went platinum six times over.
But it is not just rustic American music that Smithsonian Folkways is selling.
A 2002 double-CD set of Middle Eastern and Asian songs called "The Silk Road: A Musical Caravan" has sold 7,800 copies, according to Nielsen SoundScan.
Though that is just a fraction of the sales for Eminem in a single week, it is a respectable figure for a museum label that makes no videos, places few ads and deals primarily in music recorded by artists long dead, or in foreign languages, or from locales most Americans will never visit.
"Getting rid of inventory, which is what this custom on-demand stuff is about, is a huge step in the right direction toward making even low-selling albums into a business," said Josh Bernoff, principal analyst at Forrester Research.
Industry analysts say it is also a step toward making all music forever available, one the record business has yet to take successfully.
In 1999, Alliance Entertainment's RedDotNet subsidiary unveiled kiosks that would burn discs in retail outlets while customers waited. But that program failed, in part because the company was not able to secure licensing agreements with major labels, according to Eric Weisman, president and chief executive of Alliance.
Echo, a new consortium of retailers including Best Buy, Tower and Wherehouse, is considering development of in-store stations that would allow customers to download music onto portable digital music players like Apple's iPod.
While the Smithsonian Folkways CD-R operation allows the company to fulfill its obligation to keep everything in print, it is a labor-intensive solution that would be inefficient for the higher-demand catalogs of the major labels.
But Smithsonian Folkways is also venturing into just-in-time delivery for more popular titles. Last fall, the company enlisted the print-on-demand company Americ Disc to manufacture CD's, which are expected to sell significantly more copies than typical CD-R's, but fewer than full-blown retail releases. These Collector's Series discs come with full-color booklets and are identical in quality to commercial releases, but are sold only through the Smithsonian Folkways Web site (www.si.edu/folkways).
The first CD in the series, "Bells & Winter Festivals of Greek Macedonia" proved so popular through mail order that the company quickly made it a regular retail release.
It is hard for some to ignore the irony that as Smithsonian Folkways uses CD-R's to further its business, much of the industry hopes to limit the technology's use.
"It's almost like a little bootlegger's operation going on," said Dean Blackwood, owner of Revenant Records, an esoteric Americana label.
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The labels don't own the copyright in perpetuity. IIRC, the record labels usually get a deal where they have exclusive rights to a recording for some time, like 30 years, but the copyright on both the music and the specific recording still belong to the writer and performer, respectively. Thus the labels don't have the right to give the recording away, even though they have the power to ensure that it stays out of print until their original contract rights for it expire. There was actually a big stink on this topic a few years ago when the record companies tried to have albums legally declared to be "works for hire", which would have legally transfered all rights to the labels, rather than just giving them temporary exclusive rights to publish the work.
There's no point in questioning authority if you aren't going to listen to the answers.