Today I’m handing over the reins to one of the smartest folks I know: the effervescent and effortlessly au courant Ehren Gresehover. After hearing him articulate a major frustration I’ve had with digital music, I asked him to wax analog. With less ado:
No doubt Ian and I would’ve become friends even if we’d tried not to. I’m a proud Tarheel, a staunch lefty, based in Brooklyn and Facebook friends with his mom. But I’d like to think that even had I been a Dookie, our twin obsessions with A) pop music and B) throwing a toddler tantrum whenever somebody tried to shove a piece of conventional wisdom down our throats would’ve found us ranting over a dram of single malt anyway.
And what he’s asked me to talk about today is probably exactly the sort of thing we might have been talking about over good scotch, namely my refusal to feel sorry for the current plight of the music industry. The music executives have so far been pretty successful at controlling the narrative of the abysmal state of their business. Sales of CDs and cassettes have seen double-digit declines in sales year after year for most of the last decade. Digital sales have increased, but are nowhere close to filling the gap.
And the villain, of course, is a legion of evil teenagers, using increasingly sophisticated pieces of software to rip, burn, mash, post, pirate and steal the valuable product put on store shelves by dedicated music industry professionals.
As a music writer and a social media consultant, I’ve spent a lot of time thinking about the music business. And while I’ve got my problems with copyright law in the 21st Century, let’s keep it simple: The music industry would have you believe that every downloaded song — even those pilfered in giga-chunks on the torrents or boosted en masse off of your ex-boyfriend’s ipod — is a missed sale, an idea I find preposterous. But undoubtedly people do get some things for free that they would otherwise have bought, so let’s just take that as a given.
But as I contemplated both the purchase of a Wii (to play Beatles Rock Band, natch) and the DVD of recent genre mash-up masterpiece DOOMSDAY, it seemed to me that something else might be going on. The Ehren of 1998 spent zero dollars on his “home video library” and didn’t have much use for video games. Not because I didn’t like movies or video games, but just because I didn’t really see the value in owning movies or playing the sort of video games that were available.
But these days, buying a movie on DVD is a much better experience, with lots of nifty bonus features, higher fidelity and no need for a separate rewinder shaped like a Corvette. And video games are approaching the sort of immersive real-life experience that Tron (the movie) promised but Tron (the video game) fell far short of delivering. Is it possible the reason people are buying less music because they’re buying more movies and video games? It seemed like an interesting question.
A quick Googling of the relevant info gave me enough to paint an interesting picture. I decided to use data from two years:
1999: Napster’s summer launch and the beginning of widespread fired sharing, the beginning of the DVD player as a must-have add-on for high-end home theater systems, and just before the video game console wars that saw Playstation 2, Nintendo’s Game Cube and the XBox try to blast each other apart… and
2005-2006: when all of these things had all matured to more or less the point we’re at now. I took the figures from a variety of sources, and while they’re not rigorous enough for publishing in The Economist, I think they’re good enough to show an interesting trend.
music sales $14.2 Billion
dvd/vhs sales+rental $12.8 Billion (dvd sales only $0.8 billion of this total)
Console video games + units $9.6 Billion
music $10 Billion
dvd/vhs $24.3 Billion
console games + units $17.1 Billion
So while the music industry lost $4 Billion, or something like a third of its business in that time frame (and has lost more since), the total amount of money people spent on take-home entertainment has almost doubled, from $32.6 billion to $55.6 billion. Interesting, huh?
So there’s no question that the music product has been devalued as a result of file-sharing. And I think the same thing will happen more and more with movies and video games as time goes on. But imagine – if you will – that the music, movie and video game industries are actually just three giant companies competing for the home entertainment market, in the same way that the big car companies compete for the personal transportation market.
When you look at it that way, “Music Inc.” just looks like a dinosaur that can’t keep up with two hungry innovators with fancy new products to sell, and a flagging demand for their own. Not unlike GM in the mid-80’s, with gas prices and maintenance issues opening up the market for more nimble companies from Japan.
So I’ll toss down my cash to relive Beatles’ early gigs at the Cavern Club, and I’ll probably buy 13TH WARRIOR on DVD to have swordfights to watch while I toss down a slice of pizza before going out, but until the music industry finds a way to sell me a higher-value product, I’ll probably continue to download most of my music from the blogs — for free.
Ehren explains it while we’ve both been drinking, May ’08