Just Give It Away? Paid Downloads Still Declining

If “flat is the new up” these days, then paid downloads are doing okay.

But for many artists, simply giving it away now seems the better route.

Perhaps it depends on the perspective and position, though the numbers are showing decreased interest in paying the piper.  According to Nielsen Soundscan, paid downloads slipped a modest 0.2 percent to 597 million units during the first half in the US, a possible prelude to bigger declines ahead.

Actually, some other formats were popping – so to speak – including vinyl.  Wax gained 9.1 percent to 1.3 million, a meager amount by industry standards but certainly something for smaller stores and artists.  Digital albums, meanwhile, gained 13.7 percent year-over-year, to 42 million.

But those are mostly sideshows, and for a recording industry in crisis, the absence of a serious revenue-gaining format is troubling.  And for artists, the situation introduces a tricky decision between upfront profit and longer-term awareness.

7 Responses

  1. modelsandmoguls

    “And for artists, the situation introduces a tricky decision between upfront profit and longer-term awareness.”

    Are artist really “profiting” from music downloads?

    In the past 60 years of the recording industry, how much has the artist ever “profited” from recording sales relative to their primary revenue stream, live performance?

    The Internet is introducing the demise of the Record Label/Distribution Company not the professional branded musician…though the Labels/Distributors would have us believe otherwise.

    I say artist have never really “profited” from Record Sales and if anything, are now less encumbered by the Label’s racket to make money writing songs by having quick and self-directed access to their fans.

    • MisterSoftee

      I think that’s the point being made. That trying to make money up front gives limited returns. But awareness building (which gives $0 now) could give a better return later. I think it’s more about where to charge in the food chain, and when.

  2. Simon Adams - MyMusicSuccess

    Although the figures show a decline in physical sales, the successful independent artists that will continue to win will offer exclusivity, trust and 100% quality to a loyal fanbase in order to drive revenue. They’ll also look at diversification to bring in multiple streams of income, create partnership opportunities to act as a channel for other products, and rethink the way they do business. Those that change will succeed, those that don’t will fall by the wayside.

    I’ll be discussing how to embrace change in the music industry in my keynote presentation at the Future Music Forum 2010 organised by Icon Events International in Barcelona this September (www.futuremusicforum.com) – I hope you can join us there.

    Simon Adams
    Co-Founder
    MyMusicSuccess

  3. Anthony Martin

    Ever changing technological advances obviously open up new vistas for individual Artists but, in doing so it eliminates revenue channels to others. This is the nature of the beast. Attempts to resit it are usually futile. We have to accept and embrace the status quo and, move with the times.

    Accurate measures for sales and, the buying public’s intentions, are clouded by factors such as wealth in society and the negative affects of capitalisms migration of wealth to fewer people. The fact of freeloaders file sharing certainly does impact both financially on artists as well as the motivational desire to create music. This is a travesty.

    I can only speak personally of how I purchase music and why, ie. I only buy physical CDs because, it has great artwork, lyrics, song titles, I can copy it to use in the car, I can copy it to put on my iPod, I can show it off to others, I can lend it out and promote the artist. But, I refuse to make copies for friends who are only too keen to freeload on me and, derive their own financial gain at my expense. So, here I believe is the future of music. Hard copy CDs plus individual Mp3 digital downloads. But, who knows?

    Anthony Martin

    anthony.smartin@tiscali.co.uk

    http://www.youtube.com/topdoginuk

  4. GeoffW

    Most artists, especially those in the UK, make their money off of concert/venue ticket and merch sales, at least over the past couple of years.

    The decline in the US has a large part to do with digital album sales, something that’s not getting enough attention in most of the coverage. There’s a current policy to shift popular albums and their popular tracks to be album-only purchases, which results in some album sales but also results in some single purchase losses.

    This is especially true for recordings that are coming from compilations and soundtracks, as they are even less likely to sell their hit singles individually.

    I enjoy the news, thanks for the solid reporting.

    -gw

  5. berkleeguy

    Don’t give it away my friends, make it an impulse!!! 🙂

  6. David

    iTunes needs to update the stores. They need to stop variable pricing. They need to make the ‘music’ store a music store not a combination of music, films, apps etc…how it was in 2004

    The amount of content on iTunes is mind blowing and leaves kids confused.

    See ‘Spotify’ – simple and focused on the music. No promos is there policy. The new stuff is just that.

    It too simplistic to say downloads are declining, give it away. iTunes has got complacent and moved it’s focus away from sound recordings. That’s all.