As We Head into Fall, What’s the State of Music Streaming vs. CDs?
An email from Matt popped in last night:
The answer is both “yes” and “no,” depending on your definition of death. Yes, CD sales are in a death spiral, but only in the sense of their position as the most popular format for disseminating music. While CD sales still account for the vast majority of music sales, their primacy is being destroyed by digital downloads and streaming music services. Fear not, however. There will always be a market for physical media for music. It’ll be a long, long time before the CD joins the ranks of the 8-track and the 78.
CDs couldn’t kill vinyl. And despite the rise of streaming music services, look at how well vinyl is doing. And there is the tiniest inkling that people are beginning to realize that MP3s don’t sound very good when compared to CDs and vinyl. I have a feeling that we’re slowly moving back towards and era of high fidelity, a world where listening to music through cheap earbuds and laptop speakers just won’t do. Apple, Deezer and others are looking closely at hi-res music streams.
And there are plenty of other things that streaming music services need to address. Mark Mulligan addresses these in an article called “The Three Things Streaming Needs to Fix Next.”
- Deciding what streaming’s main role is
- What happens to the middling majority of artists
- How to monetize the relationship between artists and fans
As I’ve said many time in the past, streaming is the next big thing for music distribution and consumption. But we’re nowhere near certain on how it’s all going to play out. Best keep your CDs close–for the time being, anyway.
We are in a market very similar to 1971. Sam’s was a two store operation. There were no national chains, the stores were populated with people who wanted to sell music to people and fidelity in peoples house was just starting to take hold. The customers for recorded music were people who valued listening to music at home or about 20% of the population. Does this sound like today. The similarities cannot be avoided. Fidelity is out the window. Yes HMV is a national chain but are dominated by chart, gold and platinum and greatest hits comps. The indie stores are populated by people who want to sell music to the 20% of people who value listening to
music. Compact Discs have pulled back and making a living is tenable for all of us but I am convinced that they are not going away anytime soon.