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What about artists like Kid Rock and AC/DC who are actually making a ton of money by staying away from digital music? It's a big surprise, but the albums released by those artists this past year have surpassed what anyone expected, as far as sales go.

To be honest, I was surprised by the figures myself - I tend to support digital music over the CD. But there's apparently still a large market out there of people who prefer having a tangible (CD) product in hand.


hypebot, please stop quoting biased sources - Gartner is an IT firm that stands to make more $ if labels believe this .. and I wonder if Lil Wayne would agree with this business model, as it's hard to believe that the 1 million + CDs that he's sold would all have been downloaded if no CD was available

Bruce Houghton

bestman, Gartner is a research firm that covers many areas, but most of all I did not mean to imply that I agree with them. In fact I personally think its a silly notion by an analyst who is not based in reality.

I was simply reporting what the study said and tried to politely say so with "McGuire is not clear what "online distribution alternatives" record labels are failing to fully invest in. But if it followed his advice and embraced the inevitable digital future today, the music industry would be sidelining a format that still generates 75% of its revenue. "

I'm curious if you and other readers think I should have been even more forceful in condeming the study?


Completely digital or completely physical can work for artists in apecific circumstances. Kid Rock did extremely well without iTunes, and was it Maroon 5 that had 40% of it's sales on digital? Either way it's irrelevant. The goal should be to keep physical sales going at some level, you have plenty of people who are dedicated to it (just go to www.grimeys.com to see why physical isn't dead) but adapt the business model and probably aim to have a higher amount of sales in the digital realm. Between the major labels still screwing this up and the RIAA still being ridiculous I am banging my head against the wall in frustration.

@robin- Digital sales are at least close if not surpassing CD sales in numbers. iTunes is the number one retailer (including physical sales) for a reason. The 75% revenue coming from CDs is the fact that you have a much higher profit margin from CDs (as long as majors don't pay artists, that is).

And Bruce, I kinda got the impression you agreed with the article too. I believe you stated the report very concisely, but being that you are reporting it, I would say you have a right to either state that you agree/disagree/neutral :). This is a one-sided study in my opinion, but a good article to debate on.

Matt James

There is a transformation going on, and each format has it's place at each point in time for sure. There is a strategy for each artist to present music to maximize value for their listeners. Labels, however, are way behind the curve on this and so are destroying value for their shareholders. Why? That's the real question, of course.


LOL, it's not the CD that is evil or has killed the recorded music industry. If one compares 1:1 true iTunes album sales to true physical album sales, physical sales get the nod. When individual track sales are included or the "funny math" is done (i.e. 10 tracks = an album)as has been the case, then yeah, the numbers are going to be skewed. Deal strictly with album sales straight up. Physical is still 75% of the album sales business so it's not going anywhere anytime soon. It's also likely any changes seen in physical sales also vary by genre. Funny. There are also a good deal of fixed and or ancillary costs attached to physical units such as manufacturing, freight, CO-OP, that can be minimized, but not avoided. If one wants to press and sell those physical units, there it is. The current and existing digital distribution and sales models give the recorded music industry an opportunity to test market its new products and services (new artists) with consumers and fans and engage them, virtually at many different steps. The days of recording and releasing an album first, then seeing if fans, 1- will take time to listen, 2- like it and 3- purchase it, are long gone. Fans choose which artists and songs they want to give their time, attention and ultimtely support to be it physical, digital, bootleg, P2P or otherwise. Not vice versa. That's really the problem here. Label's cannot dictate or control how folks choose to spend their money except in one way. If an in demand product isn't available, consumers will find a way to get it. The examples of AC/DC, Kid Rock and even Lil Wayne, are exceptions, not the norm. Their situations are unique to them and cannot be applied to the other 5.97 million artists on Myspace that have recorded albums and are trying to be heard, so let's dead those comparisions altogether. Labels whether intentionally or by choice, still don't really know who or where their customers are, instead relying on onestops, distributors, chains, indies, soundscan etc. to tell them. One can now begin to see where the CD went? Album sales are but one part of the revenue stream, equation or model. It's size and impact are consumer,configuration and demand dependent. In the big picture, digital track sales can be viewed as an improved form of marketing, promotion and even A&R. Digital has its place in the process, but is not a THE substitute for the process. Much like the CD. As long as artists continue to release records, the CD will always be found hanging out in the corner booth in the bar.

Happy Holidays


There is no physical future for NEW & YOUNG artists. But that's not something you can expect old people who run old labels that sell old music to embrace. We already know this: they think youth and youth culture are only good for cooking and eating.

Vinyl will survive in pockets, but if you are a new artist and you have a young audience then physical is a waste of money and time.

I'm not talking about Disney acts. I'm talking about real music for people who have begun to think, work and spend their own money.

Unless you are old, or aiming for old fans, physical is a waste....It's also TERRIBLE for the environment. I don't care how many Eagles CD's or Kid Rock Skynyrd/Zevon covers sold last year and if you care about the FUTURE of music then neither should you.

No Physical Future,
brendan b brown


I'm making music. Real music. And I think, that digital music distribution and everything doesn't throw a fit. At least I did never purchased an album of Elliott Smith or Tool online. I need a REAL booklet, I need a REAL CD. And as an artist I wouldn't want to get my album distributed online. What about the times you go to a record shop and say: "Can I buy the new Oasis record, please?" And a guy went to a rack and put it in a bag. I don't want an album on my computer with stupid Mp3 files and shitty quality.


Digital does not have to be poor quality...the labels have insisted on it starting with REDBOOK 44.1K, 16 BIT.....The CD has always sucked and been a significant downgrade from analog....MP3's, AAC's are worse. Why would an industry reduce quality and increase price unless they WANTED to fail or were miserably ignorant?

I listen to vinyl almost exclusively but..physical is over...

......What about the times you go to a record shop and say: "Can I buy the new Oasis record, please?" .......

Those days are over, unless quality goes up, WAY up!...And I'm not just talking about the resolution.

DSD iPods/iPhones NOW
brendan b brown


As you read this thread it is obvious an argument can be made for both sides. There are styles of music and pockets of listeners that will thrive in the CD world. However, the music industry as a whole is slowly being killed by the CD. The revenue figures are VERY clear. The original Gartner study is correct in that if the music industry is to thrive again it must abandon the CD business model. Agree or not, but inform yourself with the major label sales figures since the CD format matured. Like it or not the CD will slowly go the way of the pay phone. There will be a few here and there but only for the last holdouts and the simpletons.


do some people really think that music sales will eventually be 100% digital ? not in our lifetime... and wheatus is WAAAYYY wrong thinking an MP has better sound quality than a CD..


lastchance...In our lifetime?!... you must be over 90.. speak for yourself.

Do you even know what DSD is? I'l give you a hint...It's not MP3. Did you actually read my post or just glance and then spew fail?

Some of us have our lives and livelihoods riding on this and cannot afford your particular brand of half a$$ epic ignorance.

brendan b brown


Hey! Thanks for posting as me, genius!

Thanks for posing as me, you moo cow!

Never touch my computer again, you dope.

You may be right about this stuff, though. What do I care?


...and that's what happens when you blog rant using your best friends computer....

brendan b brown


I wonder the same thing, lastchance. I just can't imagine a world where distribution is 100% digital. And I'm waaaaaay under 90. I am slower to figure technology out, and I guess I value the physical product more than some, but isn't there some value in an artist being able to put out something that's actually tangible?


CD's are all 100% Digital too but I get what you mean.

Absolutely...Vinyl is the only music I buy...but that's never going to account for the majority of sales again. I wish I was wrong about that.

I too was a physical product guy...I'll never forget walking up to the counter at Tower with my Highway To Hell tape, proud to be who the tape said I was, an AC/DC fan. So you see, I could be pushing 90 myself...But I know that music is a youth culture thing....That's how it stays vital....currently it is not vital, rather a Baby Boomer Nostalgia Puke Fest.

That said we are knee deep in the 2nd generation of kids who don't buy or value physical. Digital has an upside for the environment too ...I say let these kids lead the way. What's the alternative, more Streisand Box set reissues?

If your not servicing kids you are not servicing the future....show them all the beauty they possess inside.

brendan b brown

Mic Lowrey

Listen people

The digital vs tangible thing is great, first, most of the country, this country, does not have high speed internet, most of the world, this world, does not have high speed Internet, so the thought that, physical CD's are going anywhere is nuts, it is about how you get your music after all, when more CD players becasme available, more people, bought cds, you think people are buying music on their phones and than sending wirelessly to their computers, you are nuts, people on the coast have no idea how people in middle live, Kentucky, Iowa, Montana, places with open spaces, there is not a lot of high speed bandwich, DSL whatever, if we changed the way we went online (electric maybe) than we can have this argument, for now, it is just not relevant

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