Music News: Is Music Sales Dead?

kawaii-music-biz-2015-billboard-650Is music sales really dead? well, it all depends on who you ask. If we look at CD sales, well it is definitely on it’s last breath, but when we turn and look at the streaming sales it like a new born trying to figure out what’s going on in the world. Check out this great article written b of and come up with your own conclusion. 

The talk of death often follows a double-digit decline in a music format’s sales. The latest example is an article from The Atlantic titled “Death of Music Sales.” Its origins can be traced back to the 2014 Nielsen Music U.S. Report. Most anything related to purchasing had negative growth last year, the exception being vinyl. Anything with the word “streaming” had positive growth — usually in mid-to-high double digits. In aggregate, the numbers tell the familiar story of a content-based industry in transition.

But what does the word “dead” really mean? Here, The Atlantic plays both sides of the fence. First it puts “death” in the title — the handiwork of an editor fine-tuning an online article for maximum traffic. Author Derek Thomspon provides a working definition a few paragraphs down: “a formerly popular thing [that] is now withering at a commercially meaningful rate.” That’s actually a solid definition, and one that’s common in business journalism.

However, the numbers still show a pulse. CD sales withered at a commercially meaningful rate of -14.9 percent last year. The rate of digital sales’ decline was almost as substantial: -9.4 percent for digital albums and -12.5 percent for tracks.

Music purchases aren’t dead in the sense that they’re at zero, or soon going to be zero. Music purchases are dead in the sense that consumers are moving to different formats and ways to experience music. Physical sales are being replaced by digital sales and online access to vast catalogs of music.

Transitions often result in strange predictions. Just a few years ago, there was a warning that sales of downloads and CDs “will fall off a cliff” in “two to three years,” as Bob Lefsetz wrote at the end of 2011. Those two-to-three years have passed and the cliff hasn’t arrived. Nor did major labels decide to abandon the CD by the end of 2012, a claim that was briefly passed around the Internet in November 2011.

People in the music industry that closely follow sales and trends, who understand retail dynamics and have at least a slight grasp on consumer behavior, don’t believe music purchases are dead or anything close to dead. They instead believe music consumption in the future — roughly 10 years out — will be a mix of new platforms and old habits. They understand that some consumers — like country fans — still prefer to buy CDs. As long as retailers don’t ditch the format, the CD can continue to hang around.

The trend in download sales is more complicated. The download sales leader also happens to be the company that’s making a big push into streaming. Apple will need to figure out a way to balance its old role as a download seller (with iTunes) with its new role as a streaming service provider (with Beats Music and iTunes Radio). The runners-up in download sales have also made a push into streaming. Amazon launched Prime Music last year. Google is rolling out YouTube Music Keyand already has Google Play and the Internet radio service and editorial recommendation engine it acquired last year, Songza.

There’s a bright side in the event death is a frightening concept. That same Nielsen report shows overall music consumption dropped only 2 percent last year. Add album and track purchases to streaming activity (converted into album sales) and music consumption almost broke even. Purchases may look dead, but other parts of the music business show is filled with life.

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