Media Research Exec Says Music Industry Is On Its Last Legs

Ponca City, We Love You writes "For years, the major record labels have fought a pitched battle against the MP3 format. Although major labels like EMI and the Universal Music Group have embraced MP3s in recent months, a story from the Mercury News says early returns from those moves indicate they've had little impact on the industry's fortunes — for better or for worse. 'These are ailing businesses on their last legs,' said Eric Garland, chief executive of BigChampagne, a market research company focused on digital media. The question of copy protection on song downloads 'matters a whole lot less to them than it once did.' The industry has a bigger problem. Consumers used to buy CDs for $10 or $15 a pop. Increasingly, they're buying songs at about $1 apiece instead. So, even if transactions continue to increase, the industry is seeing far less money each time consumers buy and it's having a difficult time making up the difference."

Comments

Bah

[JMZero]

My understanding is that, for a $1 iTunes download, the breakdown looks something like this:

$.75 - Label
$.20 - Apple
$.05 - Artist

If the middleman (who provides neither the content nor the bandwidth, and takes 3/4 of the money) can't make a profit here then I think perhaps they're doing something wrong.

The party's over

[Dachannien]

Witness the power of the free market at work. When you've been fixing prices for decades to shore up your profits, you shouldn't be surprised when that system comes crashing down, once an innovation comes along that turns your industry on its head.

This is how OPEC will feel, if ever we get off our asses and start making commercially viable electric cars.