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The author quotes Tim O'Reilly and shows why he isn't necessarily correct. > Don’t need to take my word for it. Just look at all the other industries that have

The author quotes Tim O'Reilly and shows why he isn't necessarily correct. > Don’t need to take my word for it. Just look at all the other industries that have gone digital. Take music. Physical music sales have been declining steadily for more than a decade, and while digital sales rise, they make up only a fraction of the loss. (They’re not even rising much anymore either.) Revenue from Pandora, Spotify, YouTube ads and the like are loose change next to CD sales declines. > What’s the shortfall? All told, the United States recorded music industry is worth less than half of what it was a decade ago, and the downward slope is only getting steeper. Outside of the big markets, the declines are greater. The Spanish music industry fell 55% in the last five years alone. In China rampant CD copying and file sharing have left a nation of 1.3 billion people with a $75 million recorded-music industry. As a recent Economist report put it, the “worst-case scenario has already come to pass.” Sales are not doubling everywhere. The industry has shrunk to a fraction of its previous size.

DennisP 16y ago
He says "obscurity is a far greater threat to authors and creative artists than piracy." The industry is another matter. Its main contribution is file distribution, a function which we can perform for free now. I expect the industry to ultimately shrink to zero, while authors and creative artists do just fine. Over ninety percent of the money we pay for music used to go to the industry, and we thought that was fine because they were pressing all those vinyls and CDs. Now the industry thinks they still deserve that ninety percent, just because they used to press all those vinyls and CDs. Free markets don't work that way.
- NickPollard 16y ago
  Exactly. Many musicians are doing better than before, due to getting a larger portion of income through live performance than recorded music. [1] The recording industry might be shrinking, but the music industry is growing. [1] http://www.economist.com/node/17199460 http://www.economist.com/node/17199460
pmichaud 16y ago
I don't think those figures are really meaningful. What about the mushroom cloud of new and different bands who are all unsigned, all selling CDs and shirts, and booking shows, etc, while the giants fall? Those are the growth areas, not the giants. It's easier to measure the downfall of the giant and say that's what's happening to "music," but really what we're looking at is corporate revenue. We need a better way to measure the actual music industry, instead of just the dying players who used to dominate it.
RyanMcGreal 16y ago
> The industry has shrunk to a fraction of its previous size. And by "the industry" you mean the large corporations that don't create art (the artists do that) but extract most of the value of the art products that are sold by acting as gatekeepers to the market.
tel 16y ago
There's no doubt at all that the music market is transforming. I'm not sure why people are so surprised that it will probably transform into something smaller. The power shifted from music executives to musicians who always wanted something more genuine. It's necessary to consider that the number of music listeners who genuinely like some bands is a smaller market than anyone with a radio/tv/ear who could be pumped full of American Idol promotions and Top 20 Lists. I think there will probably be oscillations, though. As whatever the new form of music takes more cohesive shape, musicians learn how to monetize it, consumers learn how to invest in it, the market will probably grow again. Not to it's previous towering height, no, but perhaps to a more efficient structure that actually does have bands making money relative to the value of their work. I'm definitely pretty optimistic. Then again, I've also learned to love music in the middle of this transformation and have invested thousands of dollars over many years buying music from artists. I'm only tempted to search for torrents when I see people signed to bigger labels. After all, they're cushy right?
hxa7241 16y ago
But whether the industry is shrinking, or sales are down, is not really the question. That is really what the industries themselves care about. The important thing is whether we, the public, have sufficient production, which is a somewhat different thing. And various measures show production has not fallen, in fact it has risen, significantly. One example: http://www.unifr.ch/controlling/seminar/2009-2010/oberholzer_harvard_File-Sharing_and_Copyright_2010-01-12.pdf http://www.unifr.ch/controlling/seminar/2009-2010/oberholzer... . And does it seem like we have less music, films, books now? It seems quite the opposite to me. If we are currently living through 'the worst case scenario' and an industry 'a fraction of its previous size', we seem to be doing pretty damn well.

DennisP 16y ago

He says "obscurity is a far greater threat to authors and creative artists than piracy." The industry is another matter. Its main contribution is file distribution, a function which we can perform for free now. I expect the industry to ultimately shrink to zero, while authors and creative artists do just fine. Over ninety percent of the money we pay for music used to go to the industry, and we thought that was fine because they were pressing all those vinyls and CDs. Now the industry thinks they still deserve that ninety percent, just because they used to press all those vinyls and CDs. Free markets don't work that way.

NickPollard 16y ago
Exactly. Many musicians are doing better than before, due to getting a larger portion of income through live performance than recorded music. [1] The recording industry might be shrinking, but the music industry is growing. [1] http://www.economist.com/node/17199460 http://www.economist.com/node/17199460

pmichaud 16y ago

I don't think those figures are really meaningful. What about the mushroom cloud of new and different bands who are all unsigned, all selling CDs and shirts, and booking shows, etc, while the giants fall? Those are the growth areas, not the giants. It's easier to measure the downfall of the giant and say that's what's happening to "music," but really what we're looking at is corporate revenue. We need a better way to measure the actual music industry, instead of just the dying players who used to dominate it.

RyanMcGreal 16y ago

> The industry has shrunk to a fraction of its previous size. And by "the industry" you mean the large corporations that don't create art (the artists do that) but extract most of the value of the art products that are sold by acting as gatekeepers to the market.

tel 16y ago

There's no doubt at all that the music market is transforming. I'm not sure why people are so surprised that it will probably transform into something smaller. The power shifted from music executives to musicians who always wanted something more genuine. It's necessary to consider that the number of music listeners who genuinely like some bands is a smaller market than anyone with a radio/tv/ear who could be pumped full of American Idol promotions and Top 20 Lists. I think there will probably be oscillations, though. As whatever the new form of music takes more cohesive shape, musicians learn how to monetize it, consumers learn how to invest in it, the market will probably grow again. Not to it's previous towering height, no, but perhaps to a more efficient structure that actually does have bands making money relative to the value of their work. I'm definitely pretty optimistic. Then again, I've also learned to love music in the middle of this transformation and have invested thousands of dollars over many years buying music from artists. I'm only tempted to search for torrents when I see people signed to bigger labels. After all, they're cushy right?

hxa7241 16y ago

But whether the industry is shrinking, or sales are down, is not really the question. That is really what the industries themselves care about. The important thing is whether we, the public, have sufficient production, which is a somewhat different thing. And various measures show production has not fallen, in fact it has risen, significantly. One example: http://www.unifr.ch/controlling/seminar/2009-2010/oberholzer_harvard_File-Sharing_and_Copyright_2010-01-12.pdf http://www.unifr.ch/controlling/seminar/2009-2010/oberholzer... . And does it seem like we have less music, films, books now? It seems quite the opposite to me. If we are currently living through 'the worst case scenario' and an industry 'a fraction of its previous size', we seem to be doing pretty damn well.