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2007 Music Industry Review

I originally planned on starting a weekly blog at the beginning of the year. It didn’t happen, not even once. Thankfully Dylan Peterson picked up the slack and has been well representing the music section in my absence.

Now that the year is almost over I thought I’d crawl out from under my rock and give the whole blog thing a go. So here it is, a summary on the year 2007, as it pertains to music industry.

(Before I begin, be sure to check out our Top 10 Albums List for 2007 as well as the Relevantmagazine.com writers’ Individual List as well. Both can be found in the music section on Sunday, Dec. 23)

The big story in 2007 was that the entire music world has finally resigned to the fact that albums don’t sell anymore. At least they can’t be sold like they have for the past fifty years- in stores, for money.

Unprecedented marketing schemes abounded in ‘07. Independent labels like The Militia Group, Kill Rock Stars, and Sub Pop (to name just a few) have long made a part or all of their albums streamable/downloadable for free in order to get public’s attention and possible sell a few CD’s in stores. However, 2007 was the year huge artists like Radiohead and Prince resorted to giving their albums away in order create awareness. It was also the year an artists success on MySpace actually meant something, like…lots of greenbacks (Lily Allen, One Republic).

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It all began somewhere near the start of the new millennium when everyone was stocking their basements with Dasani and Chef Boyardee as they prepared for the coming apocalypse. The Y2K doomsday threats proved false for the majority of the world. However, the worst fears came true in the record industry.

Since 1999*, the total amount of album sales has plummeted from $14.5 billion industry to $11.5 billion. We’re talking about an industry that once enjoyed 25 years of 20% growth PER YEAR since 1968.

In 2000, the 15-25 age demographic was responsible for 30% of the albums being sold worldwide and the 40+ demo was responsible for 25%. Now, according to the RIAA, the standard for yearly reports on album sales, a role reversal has occurred. The RIAA states that the 40+ demo is now purchasing 35% of the albums bought in stores and the 15-25 demo is now only responsible for 23%.

Here’s where the problem lies –

40+ year old dad purchases 15 albums from his local retailer this year= dad enjoys listening to 15 new albums this year.

18 year old son purchase 10 albums from his local retailer this year= son listens to 10 new CD’s this year, along with the 300 albums he downloaded for a pittance, if not for free.

Have you heard of BitTorrent? All of you under the age off 22, I see you nodding yes. Those of you 30 and above, it’s okay, here’s a quick lesson. Bit torrents are the new Napster, back when it was illegal. Actually, Napster was your neighborhood mailman whistling down the lane to deliver you Grandma’s Christmas letter with that crisp 5 spot inside. BitTorrent is the freighter pulling into the port of Miami that can deliver 1 million tons of cargo to your backyard in an afternoon.

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How does it work? Ask almost any student in any dorm USA and they’ll show you how to download a hard drive’s worth of music, movies, and TV, all in the time it takes to sleep through a biology lab.

It’s been a decade since Napster was developed and there is still plenty of music getting stolen. The good news? Well, good music is getting to more people. Legitimate internet retailers are finally getting their act together as well, which helps the artist get back to making some money. No longer does your out of touch radio DJ need to give you the 411 on what’s good. You can find it yourself through internet research, streaming, and downloading.

As a consumer, I absolutely love the era we’re in. I’ve become a pickier, albeit smarter music fan. I get to preview what I purchase; never again will I blindly succumb to the hype of the latest “must have” album. Artists are getting smarter as well. It’s exciting to watch an artist kick the massive music label corporation to the curb because they couldn’t sell dirt to a worm.

Artists are realizing they can do things ridiculously cheaper than a big label, and through the internet, they get their music to the fans quicker and easier. Major success without a label is something that hasn’t happened since Edison invented the phonograph, basically never. These are strange times. However, a powerhouse industry like the record making biz isn’t going anywhere soon. In 2008, I predict they will try to take back what they think is theirs; let’s hope they don’t take the good music with it.

*All statistics provided by the RIAA (riaa.com)

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