Digital Music Sales Decline
According to the Wall Street Journal, Apple’s iTunes digital music download store will report a decline in sales of between 13 and 14 percent in 2014. What has been the 800-pound gorilla in the music distribution business is slowing losing out to streaming services like Pandora and Spotify. The central question in this latest trend is whether enjoying music requires “owning” the music. If a single album download from iTunes costs around $10 and you can get access to virtually any song you want for $10 per month, why would anyone opt for digital downloads? Tim Cook and the managers of the music side of Apple’s business must certainly be pondering the same question. After all they provided an opportunity for their own iTunes customers to listen to music for free with the introduction of iTunes Radio last year.
The decline in download sales started in 2013 with the gaining popularity of streaming music services. With Tidal and Deezer on their way, the idea of music ownership is under increased pressure…except among audiophiles and those of us who appreciate having the music that we want in the quality that we want it. I’m going to sign up for a Tidal account (one of their representatives reached out to me offering a free account). If it truly does deliver lossless CD spec audio of millions of tunes, doesn’t drop out like satellite radio, and is easy to use, then their model will only up the ante for Apple and Ian Rogers, the executive that helped develop Beats Music. Word has it that he’s now been put in charge of iTunes Radio.
In a perfect world, owning music shouldn’t be that important. If you’re a collector of rare albums on vinyl, then maybe having the 12″ cardboard sleeve, liner notes, and foldout photos is essential. It’s simply not the same to look at images on your SmartPhone, big screen TV, or computer monitor. I get that. But for the rest of us…the music enjoying masses…isn’t the idea to get the music you want and like, easily, and at the best fidelity possible? And we’re getting there faster than you might think.
It is certainly true that music downloads are declining in mass-market digital music stores like iTunes. But they’re not declining at iTrax.com, the world’s first and only exclusively high-resolution audio digital music site (and the first to offer multiple surround music mixes). And they’re not declining at HDtracks and the other high-resolution music sites…and if you include the Pono initiative that is about to roll out, more “high-resolution” (actually CD res) will be downloaded than ever.
But consider this…if Neil Young’s Ponomusic web service does deliver allow us to “rediscover the soul” at CD specs, then Tidal and Deezer will be providing all of the “soul” through $20 per month streams. It hardly seems like a fair fight. One album at Ponomusic will be $15, enough to power your streaming device for 20 days or more. Unfortunately, the Pono player doesn’t allow you to stream music. There are plans for Pono 2.0 to have that capability but the new version won’t be available until the middle of next year. By that time, the marketplace will be sorting itself out…and Pono may be gone.
People are consuming and enjoying more music than ever before…at reasonable quality. The next jump will be to CD spec streams and ultimately to high-resolution, “lossless” streams. Look out a little further and you’ll be able to hear “virtualized” rooms including surround systems in your headphones.
The decline in digital music sales is nothing to worry about…the future will be full of music at better fidelity. But it will be streamed.
I know I’m in a minority but I want my media on a physical disc that I can play on demand, duplicate, rip, etc. i want to be able to play the music I want to hear where ever I am, at home, at work, in a car, in a boat, on a plane, anywhere. Nothing else lets me do that. Streaming music is blocked at work, I’m not going to pay for satellite music in multiple vehicles (my boat is in storage 11 months out of the year). I don’t even like satellite radio, I can’t control what they are playing. Even Pandora pisses me off when I create a station but they keep putting in some artist they are getting paid to push this month.
I don’t want just a download. I’ve never had a CD, DVD or Bluray fail. I’ve had lots of hard drives and portable drives fail.
I feel much the same. Even though I’m ripping albums losslessly, the physical discs and artwork/notes are of value to me.
The public may be consuming more music, but ‘enjoying’? I fear that much of it is used as “sonic wallpaper”.
The explosion of streaming culture could have a real negative impact on musicians.
Yes, CD, DVD and Blu Ray.
I’ve had dodgy CDs (usually caused by scratching) and Blu-rays (poorly manufactured). Bear in mind also that optical media has a shelf life, although not as short as magnetic media. Recently, I had one of my earliest CDs, purchased in the 90’s, fail the AccuratRip tests on a couple of tracks – the CD had been treated well and looked in perfect condition, the hardware was relatively new.
Oh yes, optical discs may degrade: CD-R much more so than glass-mastered CD. However, they can be backed up in various lossless formats now, and direct playback of these still has certain advantages over streaming.
Incidentally, the M-DISC is supposed to have a lifetime of 1000 years, and though the company now has a Blu-ray version, it’s unlikely that any mainstream records will be issued on that!
Hi Mark,
Your blog today is very thoughtful and resonates with me. This year I purchased a few pieces from SONOS and I have added several more pieces since my original purchase. Streaming internet radio and subscriptions now play throughout the house. Lots of music genres, moods, international radio stations, etc. to choose from. I like high resolution audio and still pay for carefully selected HD discs from from time to time. I am hoping that HRA music streams from the internet will become the order of the day sooner rather than later. In the meanwhile I do enjoy these minimal quality internet feeds as background music and then If I want the highest quality level I revert to discs for serious listening. Ownership of discs for easy listening is not as important to me as it once was. Robust and wireless streaming throughout the house is paramount. I am enjoying the no cost factor of listening to wonderful playlists of any type of music that is out there.
Jack.
HRA in all its forms,…. yes, it’s coming.
This does not have to be ‘either this OR that’.
I still buy regular CD’s. – but far less since I started streaming from WiMP (Tidal) in lossless qualty.
I now go for certain editions with a DVD or something special added to it. Or for the things, that you can’t find on the streaming service (it is quite a lot – depending on your preferenes in music). I buy hings I want to listen to more often, or if I (this way) want to support the musicians a bit more.
Being able to stream music has given me the opportunity to listen to music, which would cost a fortune to buy. Most of it I listen to only once or twice..
Digging into a whole catalog of a musician/group – just imagine what that would cost, if you had to buy all CD’s.
I buy some music/concert Blu Ray’s, Pure Blu Ray Audio discs and physical discs from Aix Records… as well.
One thing I don’t buy, are the ‘socalled highres downloads’ unless I know the exact origin of the files.
I have given up on SACD’s – cost too much for what they are!
And I never bought stuff from iTunes – why should I buy cripled files, that cost as much as a normal CD?
I would say – get the best of all.
Don’t let old habits keep you from exploring the world of audio.
Not surprising about iTunes. They did an update to their iTunes online, and it became a problem to get onto the iTunes radio after that. So, yeah,… of course I’m going to jump to Pandora or Spotify for internet radio,… or any other internet radio that works on whatever computer I’m using at that moment.
Keep up the good work Mark,… HiRes is the way.
It’s no coincidence that so many major artists are touring so extensively these days. This is the new music industry business model – offer flat rate streaming of everything In the hope of widening audience reach and charging ludicrously expensive ticket prices. It’s the reverse of the old logic of packing them in at concerts as a promotional tool. A 360 degree volte face.
The drop in iTunes sales may also be due to the rise and rise of vinyl, which undoubtedly is enough to raise eyebrows at the at best mediocre quality iTunes offers. Suddenly hi-res is kind of mainstream and it will be interesting to see how new services like Tidal influence thinking at Apple. As I said on another post here recently, it’s only a matter of time before Apple offers lossless. The combo of falling download sales and innovative new streaming options may just have moved the inevitable to the top of Tim Cook’s list.
Hi Mark,
I think the comment on the ownership of the music we like is missing the point here. The music we download isn’t really owned by the consumer. The CDs, LPs, Blurays, etc., that is, the physical formats, are those we still own, although with very different conditions as in past decades. I can legally sell my physically supported media, but not my downloads. I’m technically not the owner of them, and also not in the sense of being able to re-sell them.
This is a copyright – and copyleft – issue, not a question of the mere fetichism of ownership and collectors. The streaming services may seen like the future, but they are certainly no good future for artists, whose revenues are reduced even further than the abusive deals they get from labels. The real development of the industry is the development of the artists freedom and control of their production and creation, and eventual independence from middlemen and an industry which is largely a parasite.
Ownership is important from a consumers right perspective, and the currently abusive and draconian copyright laws that partly establish the limits in this area have to be reformed, and there’s a long battle ahead in this field.
Technology, that is streaming and the expedite ubicuity of music reproduction, is a question that has to be viewed from the artists perspective. Technology has to be at the service of the music and the musicians, not at the service of abusive and exploiting business models. The consumer will have more for less, the the artists will do more for less, and the intermediaries, the parasitic industry will get the most of the business.
If streaming technology is to become the future of music distribution and the ultimate consumer format, it has to play in favor of the artists, offer the alternative of ownership – having a physical format that I can lend to friend, make copys of and share, and sell – and limit the profits of the industry, who are largely intermediaries that take advantage of creative work they have no part in. The engineers and labels have to charge fair amounts for their services, and the large cuts have to go to the musicians – not the parasites.
If it comes to the ultimate value of HRA, I prefer a future of artist’s self produced and home recorded albums of imperfect recording quality, and a business model in which they control the full chain of their creative work and distribution, vs HRA and HRA streaming services on a plane, in the middle of the ocean or on a remote beach.
Also consider the enviromental impact of ubiquitous HRA streaming capacity; we know the damage cellphones are causing to our kids who use them the most and all the time. Not just living your life on a ridiculously small screen and not having a real life, but the brain cancer cases that have been confirmed as a result of constant exposure to cellphone towers within less than 600ft and widespread wireless technologies.
Cheers
While this is tangential to the subject of your post today, I felt emboldened by some of the information to offer my opinion that Pono Music will ultimately fail once Neil Young’s hype begins to fade when faced with reality. A strange and non ergonomic player, at a price that far exceeds what it offers, along with a music service that is over promising and almost assuredly going to under deliver. I applaud Neil Young’s effort to raise awareness of the quality of music, however his execution is misguided and that is a disappointment when he is capable of so much more.
I signed up to get updates from Tidal and look forward to the possibilities their service may bring. I was an early adopter of Slim Devices (purchased by Logitech then they discontinued the product line) for listening to my music with a flexibility and ease that allowed me to re-enjoy music I hadn’t bothered with for many years. With a minor amount of effort I am able to play 5.1 music through my SqueezeBox Touch and, if I recall correctly, my Slim Devices SqueezeBox SB3 also, though I gave that away to a buddy when the Touch was released.
I enjoy the daily read Mark and still enjoy the 5.1 system in my 2004 Acura TL, especially the sampler that came with it.