Many things have happened in the world of music this month, most notably the passing of Steve Jobs – a technology innovator and music revolutionary. The iPod changed the face of how we get and listen to music, bringing digital formats to the forefront. This, of course, has left physical distribution channels, though strong, largely ignored. That’s where we come in! While we plan world domination of the smart, yet forsaken stepchild that is physical distribution, here’s some musings on the latest in the industry:
According to Nielsen Soundscan, the system created to track sales of music and music video products in the US and Canada, total album sales are up this year, reaching more than $228 million in revenue so far. This bump in album sales can be partially attributed to digital format albums, which are up 19.7%. Physical album units still account for around 70% of total industry album sales. Physical sales have dropped anywhere from 18%-20% over the past few years, but the last three quarters of 2011 have marked a 3.6% increase, which is significant in an industry segment that has been characterized as outdated and on the decline.
CD Baby, the self-proclaimed largest indie music store in the world, is an online music distributor that has just recently introduced MusicStore for Facebook which is meant to create customizable storefronts for independent artists’ right on their Facebook pages. CD Baby’s music store would include customized banners, direct links to purchase the band’s music, relevant music reviews, and YouTube videos by the artist all integrated into one easy to use app. There is no need to upload any music, as it pulls all the information from the artist to your CD Baby account. MusicStore is completely free, and doesn’t require any music to be uploaded…but you have to be a CD Baby member to use this service.
Oh EMI, it was bad enough that one of the largest majors was being paraded around the industry for the highest bidder, but now it seems almost a sure thing that the company will be broken down and sold separately, as predicted by many. Now the list of potential buyers, which was around 10, is getting smaller and smaller, with many pulling out thanks to the weak markets as well as the lengthy bidding process. Of course Citi hasn’t given up hope, but they should be prepared for a much lower valuation then they hoped for.
Rhapsody has just bought Napster from BestBuy, bringing the two most popular streaming services together to create a new streaming superpower. BestBuy will receive a minority stake in the company, but giving up Napster seems like a mistake move on their part, as they are essentially taking themselves out of the digital music arena. Rhapsody and Napster’s synergies are mostly likely aimed at dominating the rising competitors in the industry such as Spotify, MOG, and Rdio.