Is the record business changing?

Warner Music Group has announced they will begin experimenting with three-to-four song albums, abandoning the long-play record format altogether for the first time.  The goal is to stop the ever-growing (at least in the mind of record company executives) piracy of songs via services like Grogster and others.

Unless Warners in particular and the industry in general has smartened up quite a bit in the last month or so I don’t really think this is going to work or do much of anything to restore the lousy reputation the industry has. The experiment will likely be in limited markets and the CDs will probably still cost at least $9.99, even if they only contain four songs. Why? Because that seems to be the price-floor the companies have put into place, if only unofficially. The CD singles that replaced cassettes (which replaced 45s) contain the single, a B-side and then maybe two or three re-mixes of the single. And those are priced at $6-7.

Oh, and is this experiment backed up by any sort of market research? None is mentioned in the article, only that they are trying out different business models.

The article also states the shift if an attempt to shore up CD sales in light of the increasing popularity of legal internet purchases. Here’s where I think the music label is so entrenched in their current thinking that they will never be able to pull themselves out. Unless it’s because of the massive margins on CDs there is no reason to shore up the CD format. It’s been around for the better part of 20 years, an unheard of lifespan in today’s world. The CD has also become somewhat of an anachronism, something that only a select few buy as opposed to a mainstream product. Even more specifically it seems to be older demographics, the ones that either grew up with records or came of age alongside CDs that are holding on to the shiny silver disc.

If Warner Music really wants to go down the path of small “clustered” releases they would be wise to price it competitively against internet download sites such as iTunes. Reach out to the potential consumer base by selling the disc at concerts. Do something to alter the image of soulless corporations shilling the next pre-teen diva to the masses at the expense of more talented musicians.

I’ve bought music exclusively from iTunes for about four months now and plan on doing so almost exclusively. There are still some records I want to own physical copies of, but I’m right on the cusp of that demographic line. Don’t count on me or my contemporaries to keep your CD production houses in business. In fact, don’t take any group for granted. Market share is gained by innovation and kept by a mix of innovation and outreach.

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