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iTunes Sales Ban Does Increase CD Sales
Guinnessy writes "According to the New York Times, some music labels have deliberately stopped selling some new singles on online stories such as iTunes or Rhapsody while promoting songs on the radio, so that listeners will rush out to buy the CD album instead. The album appears in itunes at a later date. Not everyone seems to think this is a good idea. From the article: 'The labels are shooting themselves in the foot,' says Rhapsody's Tim Quirk. However, Ne-Yo's CD In My Own Words sold 301,000 copies using this method. Chris Brown's Run It, that was in the itunes store, sold 154,000 copies in its first week. Ne-Yo's So Sick was downloaded approximately 3.4 million times on the peer to peer networks during the week of his album release while the album Run It!"was downloaded approximately 5.3 million times in the same release period."
From the article..."Island Def Jam offered a discount to retailers who stocked the album, allowing it to sell at stores like Target for $7.98 last week" This is a great example of someone making up stupid numbers. The fact that more CD's were sold because there no downloads sold makes complete sense. If these people, who were going to legitimately buy a CD could not buy it online, then they would buy it in the store. If they were allowed to buy it online, would they buy it TWICE? The important figure (which are not revealed in this meticulously researched article) is which way did they make more money or which way did they move more units. The fact that they sell less CD's when there is another format to buy the media should not be a surprise to anyone (except for record execs, who can't count).
Nothing great was ever achieved without enthusiasm
One sample? You draw conclusions from ONE sample? Hire some statistician, would you?
There are SO many variables to be taken into account that could influence that. Do they target the same audience? To give a very drastic example, if you compare CD sales to download of a Techno song and a Country song, it does NOT matter when it comes out on which medium to predict almost flawlessly which one has a higher download and which one has a higher CD count.
Were they released at the same time? If it is released around Xmas, that would boost CD sales compared to downloads (it IS after all easier to wrap a CD in gift paper than a bunch of bits). What's the weather like on release day? Bad weather and I'd rather download it instead of going out in the pouring rain.
Do the CDs offer the same "goodies" that come with the CD? Do they both offer the lyrics in the booklet, for example, or some pictures of the artist? How about the CD cover?
So please, before drawing conclusion from ONE SINGLE sample, at least make absolutely sure that the results are comparable. Or, better, get a few 100 samples before jumping to a conclusion!
Aaaaaand, let's not forget: If it's not available from legal download... especially if the CD is DRMed into uselessness.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
... people turn to newspapers after leading news agencies refuse to publish new content and breaking news on their websites.
Nothing more statistically meaningful than a single data point! Their powers of extrapolation are mind boggling!
now that we've compared 2 artists we finally know the truth about music consumer habits!
-- lol pwned
And why should anyone care?
hey, folks, it's epiphany time! -- the default physical medium for music sales has changed. it isn't Edison cylinders, Brunswick 77s (all "78" record makers used a different speed), 3-3/4 IPS 4-track tapes, or CDs, it's become electronic transfer.
selling CDs promotes ripping without any content copy-limiting software system. if the pinheads in Big Music had their schytte together, they'd stop shipping physical media, and sell it all online through iTunes and the like.
but all they have together is their off-key whining....
if this is supposed to be a new economy, how come they still want my old fashioned money?
What they're obviously missing is that denying iTunes sales increases CD sales which translate into more piracy.
Good plan.
A feeling of having made the same mistake before: Deja Foobar
In scientific tests, one can take a solution, mix it in another solution, and observe the results. Then one can make a single change keeping all other variables identical and perform the same tests. Those results are (arguably), if not valid, then at least a decent indication of a pattern. This summary (and I presume the article?) attempts to use this methodology with music artists -- something that by its very definition stands itself apart from science. Just because one individual's CD sells a certain number of copies through one venue, while another does comparatively poorer through another does not mean that the results are valid.
First you are taking one individual CD's sales through a store and comparing them to another CD's sales through an online distribution. While this test is almost impossible to perform (release the song at the same time through both channels and see the online distribution win and people would say that it simply hurt the CD sales, or alternatively, vice versa), it might have been a better comparison to simply take one popular artist's newer album, release it exclusively online and compare it with previous releases. Even this is not an indestructable argument, but at least you would be comparing Granny Smiths to Red Delicious, and not fruits to vegetables.
Now I am by no means a scientific person (having a greater interest in history) but it astounds me (through every century) when one side tries to sound scientific by saying, look! ho! this way works better and one can see it conclusively because the stars are in the sky and not in the ocean! This was pretty much a complete red herring of an article.
"If you're buying a Picasso," he continued, "you can't just buy the upper right-hand corner."
This is a weird analogy... if I buy a single song... that's not like buying the upper right hand corner of a Picasso (though with some of Picasso's work I might enjoy it more). It's just like buying a single painting... you select the one you prefer and purchase it. You don't need to buy the whole body of work that an artist produces to appreciate the artist... a song I would equate to a single painting... meanwhile an album is just multiple paintings by the same artist.
At a buck a download... wouldn't they make more off of the album than at the 8 dollars they are selling the thing at Target for? How much does it cost to produce and distribute these CD's to each of the retail chains? How many of those CD's that are produced are in fact sold? So how many just sit on the shelves forever? Or... if you don't produce enough to meet demand... how much money have you lost opportunity costs?
Digital just seems so much more efficient... and this robbing peter to pay paul is silly... yes if you only sell a track in a single medium... of course the volume will rise for that medium... but in the end are you making more money or less? (Say you sold 300,000 tracks on iTunes... cost/benefit?)
Digital uptake is just ramping... if they start doing silly things like this to make it harder for consumers to get their content... either they'll go back to piracy... or it'll stop the whole legal digital distribution before it's even had a chance to become mainstream.
The only possible conclusion you can get out of this is "customers don't buy the same product twice".
------- "From bored to fanboy in 3.8 asian girls" ----------
This fails so many statistical tests for process control and would never even be eligible for something like an Annova (test for statistical difference) tukey-kramer test. They find one demographic of people, internet buyers. Split them in two. Offer the download to 33% of the group, deny the download to 33% of the group, and let the other 33% have the choice to steal/buy online/buy the cd ect. All the while exposing them to the exact same marketing, radio singles, and ensuring their purchasing habbits are the same. Only then can you even begin to test which group is statistically more likely to alter their purchasing habbits.
In other words, doing all of the above is hard and takes time and just coming up with bogus conclusions is so much easier.
I can't wait until the RIAA gets so much control over the music industry that they legally charge each user every time they listen to the song. Hell, they'll charge the user 1 cent per second the song is played. It wouldn't be fair to pay the same price for a 2 minute song and a 4 minute song would it?
When that day happens, and it looks like it might, the RIAA will finally implode and independant music will return in a blaze of glory. Or be outlawed as a potential communication medium for terrorists. One of the two anyway.
CDs are easier to pirate than DRM protected iTMS songs. At least at the same quality.
Search online before you rush out and drive 15 miles in your SUV to get that latest CD.
Message to the music industry:
The horse and buggy distro system of funny plastic disks has been superceded by an Internet. Tune in or drop out.
You mean when a band puts out a cd with one good song and a pile of crap that cd sales are higher when people are forced to buy the entire cd to get the one worthwhile song than when they can simply buy that song alone.
The real story here is not "Itunes hurts cd sales" its "Itunes promotes better music". The a-la-carte style of music downloading that itunes offers punishes crappy cds for sucking and rewards good ones for being good.
Here's my dilemma. I like music and I like my computer. I used to like CD's, but I like my computer more than I like CD's. I don't like the mixed-bag-of-root-kits-and-DRM that CD's want to put on my computer, so I don't buy them. I also don't like the DRM from iTunes, but at least from them I know what I'm getting. But, I've never bought from iTunes. So, where should I buy my music? The answer is, I don't buy it at all. I would pay for it. I want to pay for it. I used to pay for it. But, I don't like my toys to be broken by greedy strangers... Ok, extremely wealthy and greedy strangers. So, now, I still get my music, and I don't pay. If the record companies still sold a product that wasn't broken, or a risk, I'd like to pay them, or better yet the artist, for the music. But they are not offering something I'm comfortable with, so they get none.
Stick with me on this for a minute:
If my family wants to see Harry Potter [insert episode here] at the movie theater, we'll go see it so we can have a blast sitting in the dark listening to the overly-amped up sound and get a fun thrill from the big screen.
However, if the DVD were available at the same time, we'd still go to the theater to do the family thing, then buy the DVD if we liked it.
Means this: we go to the theaters to see the things in which we are interested - irrespective of DVD availability. We then wait with anticipation for the DVD for a release (and generally buy it on the day it is released) if we really liked the film. What I'm trying to say is, if we like it enough to patronize the film, we'll see it several times.
Enter the music industry: The industry is trying to figure out how to stay in business, and along the way, they're forgetting something critical: the fans. If the fans like it, the ones who pay for music will buy it (and some of us will buy the CD if we want to support the musician(s)). Those that don't buy music probably won't buy the downloads or the CDs.
Key point: If the artist makes the fans happy, they'll buy whatever makes the fan happy (CD or individual download). Preventing one of the means of purchasing is not helping the artist or the label. Truthfully, (this is a personal opinion, folks) if I really like a given artist, I'll buy the CD - even if there are some tunes to which I won't listen - so I can patronize the artist. If I like one tune of a given artist - but the artist doesn't generally float my boat, then I'll download the one tune and not buy the CD.
Cutting off means of distribution is not a smart business tactic.
A Passionate Independent Musician
Maybe they didn't consider the fact that maybe people liked one song/album better than the other?! Tomorrow in the news: Sales of online-ordered giant broccoli stumps plummeted today whilst store-bought beer flourished. Is this the end of online-ordering?!
Regardless of one's ability to draw meaningful conclusions from one datapoint, they also left out another key figure.
Ne-Yo's CD In My Own Words sold 301,000 copies using this method. Chris Brown's Run It, that was in the itunes store, sold 154,000 copies in its first week. Ne-Yo's So Sick was downloaded approximately 3.4 million times on the peer to peer networks during the week of his album release while the album Run It! was downloaded approximately 5.3 million times in the same release period.
OK, so how many downloads from "Run It" were sold in the ITunes store during that time period? If it was only about 50-100K songs, then they may have a point, but if it was something along the lines of 500K songs, then all they did was to give up some profits on CDs to make the same money on downloads. So, yeah, Duh, people are going to buy less CDs if they have the option to buy a CD or buy from iTunes than they will if they only have the choice to buy CDs.
It's like a deli that sells both ham and roast beef sandwiches complaining that they don't sell as many ham sandwiches as the deli down the street that only sells ham sandwiches. Big deal...
If I don't put anything here, will anyone recognize me anymore?
This attempt by the labels to push albums is nothing new. The last time we saw, which was only several years ago, was when they were trying to stop the sales of singles. The singles were cutting into sales of albums, and the theory was that if singles were not available, then the consumer would be more likely to buy an album.
I think the more likely aspect is the key. Wiithout singles, one might be more likley to record a song from the radio or just copy it from a freind. Even then there were albums that are so bad no one wanted anything but the same album. Not even the b-side was worht anything. With singles it was more likely all parties would be compensted for the product the consumer wants, and if we dig our heads of the artistic bigotry, when one is talking about selling a million albums, we are fundementally talking about providing a product that the student wants.
So, when singles were pulled, it was a statement that the labels would tolerate more copying in the hope they would end up with increased overall profits, even if the formula used to calculate royalties meant the perfomers and other parties recieved less. I wonder if this algebra will work out in the current climate of rampant unlicensed distribution of any hit track, not to mention much more sophiticated distribution channels for used albums. Frankly there have been way too many times lately when I have gone to iTunes hopeing to legally acquire a track, only to find it unavailable or only as an album. If it is an older album, I can get it used for much less than iTunes. If it is a new album, I soon will be able to get it used. Does this help the company bottom line?
Back to the original question. If the fast food joint only offered value meals, then a person with only a burger would cause a great deal of havok at the unfairness of the situation, disrupting bussiness. And such a person would have a point. The burger is seperate, you could sell it seperately, but you choose not to. It is simply not worth the effort, despite the clear benifits.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
When the DS was unavailable a couple years a go it sold like hotcakes, same with xbox360 this year. Special colors (my wife wants a Pink DS) are only released in small quantities and therefore are highly desired.
Making people listen to a song on the radio without making it available for purchase means that it will hit the charts hard when it does release. Is there anyone who could possibly be surprised by this?