Todd Martens at the LA Times writes A Brief History of the Album's Recent Decline in Value, if you can handle yet another article on music industry woes. It's actually pretty interesting, looking specifically at how the industry has determined price points in the past. It's a reminder that the majors really were getting away with murder in the 80s and 90s, upcharging at pretty outlandish percentages. Martens also makes a point I've made in the past--namely that the industry crippled itself well before Napster ever came along. He writes:
The effect of Napster and the rise of file-sharing on the music business is probably a bit overblown. If one wants to trace the recent woes of the music business to a starting point, 2000 is arguably as good as place as any. It was in 2000 that the Federal Trade Commission declared that consumers had paid about $480 million more than they should have for CDs over the previous three years.
The cause, according to the FTC, was minimum-advertised-pricing, or MAP, policies, which the major labels had adopted to put an end to heavy discounts at music retailers. With MAP in place, retailers that sold CDs below a certain cost, say $12.99, would not receive cooperative advertising funds from record labels (the practice of reimbursing a retailer for advertising costs, such as featuring an album in a Sunday advertisement distributed in newspapers).
With the FTC breathing down its neck, and consumers rightfully fed up at continually seeing $16.98 CDs, the major record labels acquiesced to the FTC, and abolished MAP. A large retailer could now receive funds for advertising a new Madonna album, and then use said Madonna album as a loss-leader, altering what a new album should cost in the minds of the consumers.
Bill Wyman at Hitsville elaborates:
That opened the door for the big box retailers to start using CDs as loss leaders, which was the first, crippling shot at the foundations of the nation’s traditional record store infrastructure, and ultimately saw the closing of everything from hundreds, if not thousands, of neighborhood stores to, in the end, mighty Tower.
Wyman also reminds us of the days, now one, two, three decades back, when list prices would rise steadily from year to year. Which makes me think that, in a way, the whole thing may just be starting over again. So we're at $.99 a song right now, and $1.99-$9.99 for a full-length. As the digital format continues to ascend as the format for music, I won't be surprised to see those costs start creeping up again. In the meantime the corporate labels will pare down considerably--in output, in staff, and perhaps in influence. While I don't wish layoffs on anyone, I think this will be a good thing in the end. Part of me feels like we're coming back around, in some sense, to the way things were in the 60s, when a guy like David Geffen lived down the street from the artists he was signing, and the number of cooks stirring the bands' pots was considerably smaller. Hearing stories of how bands would cut a 45 and in a small amount of time they'd hear it on the radio--something about that narrative really resonates with today's environment, whereas it seemed quaint or fantastical in the 80s or 90s. There's a part of me that suspects that part of the reason today's financial woes feel so crushing is because they follow the real abberration, which was the 90s zenith of record stores and big-box retailers and MTV and corporate-consolidated radio and a format (the CD) that was ideally suited to ripping off the kids (think CD-Singles, special packaging, baby boomer reissues, double albums released separately a la Use Your Illusion, and repackaged compilations like the NOW series). The further away we get from the 90s, the more insane the whole era really seems. It really was the height of the industry. Today's environment, conversely, could be the height of music. And in a few years time, perhaps the whole thing will even out to a more natural parity.
This is just a sketh of an idea, probably riddled with flaws, but: I think that kind of relationship between bands and their labels back in the 60s gets underplayed when we talk about "how great music was back then," how much creativity and experimentation was allowed by the labels at the time, at least in part because so few people really had stars in their eyes. It didn't last for long, I know. But I wonder if we're moving in that direction again; as the industry pares down and financial success--true jackpot-style success--becomes less and less realistic, perhaps the labels will take more and more creative and aesthetic risks with the artists they push.
Comments