Friday, March 21, 2008

The other reasons that CD sales are declining


The multi-billion dollar music industry has gone through wrenching change. Sales of compact discs, the industry's biggest product, continue to decline at an alarming pace. Correspondent David Faber sat down for a rare interview with Warner Music Group CEO Edgar Bronfman, Jr., and looks at a company, and an industry, struggling to reinvent itself.

The above quote came from this month's edition of CNBC's Business Nation. While the points made in the entry -- noteably record labels competing with "free" -- were on target, perhaps the more crucial fact glossed over is the form factor of the CD itself. While the comment was made that the CD is over 30 years old, the fact is that the form factor of the CD is its own worst enemy. Compact Discs are large, fragile, subject to scratching, and not the least bit easy to store in large quantities. Further, they just aren't that portable.

CDs also haven't changed much in price in years. Even the digital equivalents of 20 songs=$20 on popular pay-for music services defy logic for many who listen to music. It certainly isn't expensive in any sense of the word to provide music digitally. I imagine there's something to the effect of packing, packaging, etc for CDs on shelf, but anecdotal evidence suggests that the CDs have generally too little content worth paying for on a CD. Not all songs by one's favorite artist are going to be hits.

As I was preparing this blog comment, I was thinking seriously about SD Media as a music distribution media. SanDisk has already beat me to it, only in microSD format. And why not? (Except iPods can't use them, and they get lost very easily).

At that point, it is very clear that Apple itself has destroyed the physical music distribution method.

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