For the First Time Ever, Older Albums Are Out-Selling Newer Albums

If albums are still worth billions of dollars, then a majority of those billions are now going to older releases.  According to US-based data just released by Nielsen Music, older, ‘catalog’ albums outsold newly-released albums in 2015, the first time that has ever happened.

 

Catalog vs. New Releases

 

Nielsen categorizes an album as ‘catalog’ when its release date is more than 18 months ago.  In almost all cases, an album has exhausted its new-release sales energy after that point, and becomes an older selection.

 

Catalog vs. New Releases

The shift is surprising given the extremely-heavy sales of Adele’s 25, solidly a ‘new release’ given its late-2015 release.  But albums are typically purchased by older consumers, a demographic that responded very positively to Adele.  Indeed, Adele’s album-heavy success has been partly attributed to heavy participation among older buyers, many of whom are less price-sensitive and less dialed into streaming platforms.

Outside of the specifics of 2015 and Adele, the broader trend makes sense.  If older people are buying albums, then it makes sense that they’re also buying older music.  But the trend raises serious questions for a music industry that is struggling to recover, and spending heavily on newer acts.

Maybe that’s foolish.  Dave Goldberg, a former Capitol Records and Yahoo Music executive, strongly advocated for a greater emphasis on catalog releases, especially since the initial costs (artist development, recording, marketing) have already been paid.  “Catalog provides 50% of the revenue and 200% of the profits of recorded music,” Goldberg (now deceased) explained in a recently-leaked email.  “With catalog providing the base profits, new releases need to be cut back dramatically to the point where the new business either breaks even or loses a small amount of money (justified by the long term catalog income stream of those songs).”

This fact is inescapable: newer artists (and their newer albums) cost a lot more money to produce, and their failure rate is obviously higher.  Younger artists also have younger fans, a group that is far less likely to buy albums (or pay anything at all).

But the argument goes beyond physical: Goldberg also pointed to heavy catalog listening on streaming platforms, including Spotify and Pandora, not to mention other revenue sources.  “In addition, streaming revenues tend to be more heavily weighted to catalog. Pandora and Spotify are probably 65% catalog [defined as releases older than two years old],” the proposal continued.

 

“Licensing and synch revenue are mostly catalog as well.”

10 Responses

    • Remi Swierczek

      Nope, just older, CD addicted folks, buying their their favorite OLD tunes!

      Reply
    • GGG

      Or the fact that music tastes are so all over the place now because you can find exactly what you want, as opposed to the 50s-90s where there was a fraction of the amount of music able to gain any notoriety.

      Think about it; through those 50 years, maybe there’s 500 artists (a very arbitrary number I chose for sake of argument) people still care about in a meaningful way, or at the very least that still sell any meaningful amount of music. Today, there’s probably 500 new artists releasing music every couple months. So if there’s five THOUSAND new acts in the last ten years that people are spending money on, they all still go back to those 500 acts of old. There’s far less range in taste, as there was far less music becoming known.

      Reply
      • FarePlay

        You mean there’s more music than ever? Now we have 500 new acts a year that work part time at Wal-Mart and I guess that’s just fine. I know you’ve got all these successful acts that are finding their way in this new age of music.

        Reply
    • mr.mojo

      Exactly!!! Today’s music is uninspired and monotonous. Rap? What the hell? There hasn’t been any Rock since the 70s. Today’s youth are brainwashed/brain deadened by garbage lyrics and looped beats.

      Reply
  1. Musicservices4less

    Catalog has always been the backbone of all solid record label business models throughout the generations, big and small. And it will continue to be. Dave Goldberg summarized it perfectly. You want to have a record label that can withstand almost anything the record business throws at you? Better have a catalog with at least a few “evergreen” masters and many other masters that businesses/consumers want no matter what generation they are. I should know, I have been running one of the oldest truly independent record labels in the U.S. for over 30 years now and that label started 15 years before me.

    Reply
  2. Name2

    “In addition, streaming revenues tend to be more heavily weighted to catalog. Pandora and Spotify are probably 65% catalog [defined as releases older than two years old],” the proposal continued.

    But, but… windowing is the answer!!~!

    LOLz.

    New industry business plan: No streaming of new stuff. No streaming of old stuff. Just keep the checks coming. Somehow.

    Reply

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