Do not make the mistake of thinking that because my conclusion is the same as another person's that my reasoning is the same
File trading will undeniably have some effect on CD purchasing. Some folks will just get their music for free, some will get the one or two tracks they like. But the RIAA has been making certifiably insane claims that cause the average person to discount every complaint the industry has. Less denial from the industry is long overdue.
…But interviews with executives at record labels, Internet companies and research companies revealed a much more complex array of problems facing the music business than just digital piracy.
"It's not all file-sharing," said Andy Gershon, the president of V2 Records, home to the recording artists Moby and the White Stripes. "I do think that right now, the business is sick but music is great."
Other record label executives agreed. Among the problems they cited were the consolidation of radio stations, making it harder to expose new bands and records, and the lack of a widely popular musical trend like teen-pop, which relied on stars like Britney Spears and 'N Sync to drive young people to record stores.
They also blamed a poor economy and competition for the limited time and money of teenagers and young adults, their main customers, who often find that they prefer buying DVD's, video games, sneakers and more.
Indeed, thousands of music retail stores have closed recently, and the ones that are still open have given shelf space to competing products, like DVD's and video games.
In addition, the introduction of CD's in the early 1980's encouraged consumers to replace their vinyl records with copies in the new format, but that sales spike has since abated.
And as major record labels have become part of large international corporations, industry insiders say, less attention is being paid to discovering and marketing music properly.
"So many labels are in play — they're trying to be acquired or acquire another company or merge — so anything that affects their immediate balance sheet is slashed," one record-label executive said. "Money is not being put into marketing and A.& R. because people don't want to spend the money because it looks bad on the balance sheet."
A recent article I read states that Universal Music Group, the largest record company, plans to drop prices really soon. But the music industry can still thrive if it continues to follow models like Apple's iTunes store. People are just tired of being ripped off.
Whatever the industry can do to make the prices more appealing to the customers, they need to do it. I also agree with Lynne on following the Apple iTunes store model. I do not download music myself, but I know the concept is very appealing and Apple does it well. I like the deals I find at half.com as well.
We'll have a music industry because people want music. There's a level on which marketing and distribution is a added value service.
But the industry will evolve. The RIAA is in the position of a velociraptor to MP3's protomamals. Like everyone else, it's adapt or die.