Record labels' bigger issue is replacing CD sales By Troy Wolverton Mercury News San Jose Mercury News Article Launched:11/17/2007 01:37:25 AM PST
In the end, the long battle by the record labels against unrestricted digital music may have been little more than sound and fury signifying nothing.
At least, that's how it's starting to appear now that two of the major labels in recent months have embraced in some fashion the MP3 format, which has no copy protection. The early returns from those moves indicate they've had little impact on the industry's fortunes - for better or for worse.
Instead, the moves highlight a bigger problem. And that is how the labels are going to replace sales of CD albums, which constituted the core of their business and have plummeted in recent years.
"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."
For years, the major record labels fought a pitched battle against the MP3 format. The format doesn't allow for any copy restrictions, which made it a popular choice for songs swapped on illicit file-trading sites such as the original Napster and Morpheus.
To combat such piracy, the major labels insisted online stores that sold music had to wrap songs and albums in digital rights management (DRM) technology, which can restrict the number of copies users can make of a song or the number and types of devices it can be played on.
But online music and electronics vendors complained that such restrictions were limiting sales, in part because not all formats worked on every type of player.
In the past year, the music labels have become increasingly receptive to those arguments. In April, EMI announced it would make its entire catalog available for sale in DRM-free formats. In August, Universal Music Group, the world's largest recording company allowed the sale of a significant portion of its catalog in the MP3 format.
The labels' moves have opened up competition in the digital music space. In September, Amazon.com launched a digital music store, featuring only MP3 tracks. Meanwhile other, older digital music vendors, including iTunes and Wal-Mart's Web store, added DRM-free tracks.
Because those songs lack DRM, they can be played on just about any digital music device.
Although it's still early, DRM-free music seems to have had, at best, a slight positive benefit to the music industry.
Sales of DRM-free music to date have "outperformed" EMI's expectations, and Wal-Mart has seen its MP3 sales grow "considerably" since August, when its Web store made them available, representatives for the two companies said. However, neither they nor other labels or Web stores disclosed specific sales results.
Overall, the number of digital songs sold each week seems to have been unaffected by the launch of the major DRM-free stores since May, according to data from Nielsen SoundScan. Digital song sales - both of tracks with and without DRM - are in the same range after May as they were in the weeks before DRM-free sales started.
But that's small consolation for an industry whose wholesale revenue in the United States was down 11 percent in the first half of this year, according to IFPI, the industry's global trade group. That's on top of declines in retail sales in six out of the past seven years, according to the Recording Industry Association of America.
Even if the effect has been questionable, some analysts think that eventually all the labels will sell DRM-free music.
"The writing on the wall, for the most part, is here for DRM," said Michael Gartenberg, a vice president and research director for Jupiter Research.
But not yet. Universal and Warner are still just experimenting with DRM-free music, and Sony BMG isn't even doing that much, analysts note.
Commander Keen had this! If you remember, there was strange writing throughout all of the series. At some point, there was a stage that if you waited at one spot long enough, you could climb of the back of a sea monster that takes you to a secret island with the translation of their alphabet.
Your kidding me?
This is the same guy that wanted to put "The Preacher" on the big screen with BEN AFFLECK as Custer and Cameron Diaz as Tulip.
C'mon! BEN AFFLECK! Christ, when will their love affair end already!
"Please note, however, that we will continue our review of the issues you raised and we reserve the right to refile the complaint against Mrs. Ward if and when circumstances warrant," Colin J. Zick, the Foley Hoag lawyer, wrote to Beeler.
Huh? This is equivalent to saying "Sorry I pushed you down the stairs, but I reserve the right to do it again!"
This is complete and utter lack of respect to Beeler, but tells you alot of what it thinks of its own customers!
Slashdot Mirror
In Poland, it would be asian chick, white woman, and a photoshopped white guy with an odd looking hand....
(For the sensitive or ignorant types see this)
I've wondered before, what would happen if you dropped one?
Am I the only one that have seen this? This is EXACTLY how I pictured it at least.
Jedi Butter Fingers
(Note: put the volume up and listen to the yelling in the background)
Wrong!
Please hand in your geek card to the nearest admin, thank you.
Record labels' bigger issue is replacing CD sales
By Troy Wolverton
Mercury News
San Jose Mercury News
Article Launched:11/17/2007 01:37:25 AM PST
In the end, the long battle by the record labels against unrestricted digital music may have been little more than sound and fury signifying nothing.
At least, that's how it's starting to appear now that two of the major labels in recent months have embraced in some fashion the MP3 format, which has no copy protection. The early returns from those moves indicate they've had little impact on the industry's fortunes - for better or for worse.
Instead, the moves highlight a bigger problem. And that is how the labels are going to replace sales of CD albums, which constituted the core of their business and have plummeted in recent years.
"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."
For years, the major record labels fought a pitched battle against the MP3 format. The format doesn't allow for any copy restrictions, which made it a popular choice for songs swapped on illicit file-trading sites such as the original Napster and Morpheus.
To combat such piracy, the major labels insisted online stores that sold music had to wrap songs and albums in digital rights management (DRM) technology, which can restrict the number of copies users can make of a song or the number and types of devices it can be played on.
But online music and electronics vendors complained that such restrictions were limiting sales, in part because not all formats worked on every type of player.
In the past year, the music labels have become increasingly receptive to those arguments. In April, EMI announced it would make its entire catalog available for sale in DRM-free formats. In August, Universal Music Group, the world's largest recording company allowed the sale of a significant portion of its catalog in the MP3 format.
The labels' moves have opened up competition in the digital music space. In September, Amazon.com launched a digital music store, featuring only MP3 tracks. Meanwhile other, older digital music vendors, including iTunes and Wal-Mart's Web store, added DRM-free tracks.
Because those songs lack DRM, they can be played on just about any digital music device.
Although it's still early, DRM-free music seems to have had, at best, a slight positive benefit to the music industry.
Sales of DRM-free music to date have "outperformed" EMI's expectations, and Wal-Mart has seen its MP3 sales grow "considerably" since August, when its Web store made them available, representatives for the two companies said. However, neither they nor other labels or Web stores disclosed specific sales results.
Overall, the number of digital songs sold each week seems to have been unaffected by the launch of the major DRM-free stores since May, according to data from Nielsen SoundScan. Digital song sales - both of tracks with and without DRM - are in the same range after May as they were in the weeks before DRM-free sales started.
But that's small consolation for an industry whose wholesale revenue in the United States was down 11 percent in the first half of this year, according to IFPI, the industry's global trade group. That's on top of declines in retail sales in six out of the past seven years, according to the Recording Industry Association of America.
Even if the effect has been questionable, some analysts think that eventually all the labels will sell DRM-free music.
"The writing on the wall, for the most part, is here for DRM," said Michael Gartenberg, a vice president and research director for Jupiter Research.
But not yet. Universal and Warner are still just experimenting with DRM-free music, and Sony BMG isn't even doing that much, analysts note.
"The marketplace wil
Thank you, Captain Obvious....
I think the worst thing Bush's done is turning most of the US's population against the US.
Ah yes...
Commander Keen had this! If you remember, there was strange writing throughout all of the series. At some point, there was a stage that if you waited at one spot long enough, you could climb of the back of a sea monster that takes you to a secret island with the translation of their alphabet.
Ah yes, good times...
Your kidding me? This is the same guy that wanted to put "The Preacher" on the big screen with BEN AFFLECK as Custer and Cameron Diaz as Tulip. C'mon! BEN AFFLECK! Christ, when will their love affair end already!
I was under the impression that this was something already available as evidence by this:
http://sidetalking.com/Images-General/3650ps2.jpg
Seriously though, why not make better phones instead of some half-assed jack of all trades?
"Please note, however, that we will continue our review of the issues you raised and we reserve the right to refile the complaint against Mrs. Ward if and when circumstances warrant," Colin J. Zick, the Foley Hoag lawyer, wrote to Beeler.
Huh? This is equivalent to saying "Sorry I pushed you down the stairs, but I reserve the right to do it again!"
This is complete and utter lack of respect to Beeler, but tells you alot of what it thinks of its own customers!