The Major Labels Are Crying Wolf

Spotted on: The Long Tail

Chris Anderson deserves a parade in his honor.

This brilliant post completely uncompresses the major label view of the music business with the actual music business.

“…it appears that every single part of the music industry except the sale of compact discs is up.

• Concerts and merchandise: UP (+4%)
• Digital tracks: UP (+46%)
• Ringtones: UP (+86% last year, but probably just single-digit percent this year)
• Licensing for commercials, TV shows, movies and videogames: UP (Warner Music saw licensing grow by about $20 million over the past year)
• Even vinyl singles (think DJs): UP (more than doubled in the UK)
• And, if you include the iPod in the music industry, as I’d argue a fair-minded analysis would: UP, UP, UP! (+31% this year)”

With statistical data to back up the claim, it’s clear that all the hoopla around the death of the music industry is a death cry form major labels. They could revamp their business models, and in fact they could have ten years ago when they knew this was coming. It’s as if these major companies have absolutely no relationship to reality.

The end of Chris’s article seems almost directed to this blog: “…for those who say that this avenue [giving away all music free] is only available to artists at the head of the curve…I’d point out that the other group poorly served by the labels are those at the bottom of the curve…”

As the major labels fail and become some new form of entertainment companies (most likely a clearinghouse for content or booking agencies), music will lose almost all of its value. Once we (the audience) are no longer pressured to buy, or told we are criminals for our actions, music will begin to regain its value.

While touring and swag are viable outlets for artists to generate revenue, the question becomes: where can smaller artists play, and is gigging still viable?

What is your take on the state of music sales, given this exciting and inspirational update on sales figures?