Digital Audio Insider -- the economics of music and other digital content


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Digital Audio Insider is David Harrell's blog about the economics of music and other digital content. I write from the perspective of a musican who has self-released four albums with the indie rock band the Layaways.

My personal website has links to my LinkedIn and Google+ pages and you can send e-mail to david [at] thelayaways [dot] com.

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If you enjoy this site, please consider downloading a Layaways track or album from iTunes, Amazon MP3, Bandcamp, or eMusic. CDs are available from CD Baby and Amazon.

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June 27, 2008

The Long Flat Tail
by David Harrell
Chris Anderson points to an in-depth look at the Long Tail concept by Anita Elberse of Harvard Business School. Elberse touches on one of my pet themes -- that the ease of online distribution for virtually any piece of recorded music is resulting in increasingly fierce competition for the attention (and dollars) of listeners -- and provides some stats that spell out the improbability of meaningful digital sales for most "long tail" musicians:
My research suggests that the tail is long and flat, and therefore that content providers will find it hard to profit much from it. It remains to be seen whether the new media environment will indeed make many previously unprofitable niche products profitable. Online channels lower the barriers to market entry for such products, and thus introduce the possibility of additional sales -- but they also lead to a flood of products all competing for consumers' attention. In my most recent correspondence with managers at Nielsen SoundScan, I learned that of the 3.9 million digital tracks sold in 2007 (the large majority for 99 cents each through Apple iTunes), an astonishing 24% sold only one copy, and 91% -- 3.6 million tracks -- sold fewer than 100 copies.
related: The Flat Tail, Even More Content, The Long Tail, the Fat Middle, and Tiny Slices

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June 25, 2008

Wednesday Odds and Ends
by David Harrell
Jason Kottke wishes he could pre-order Amazon MP3 albums. Not sure why you can't -- it's an option for some albums in the iTunes store. Maybe it has to do with the availability of bonus content -- you usually get something extra (bonus tracks or videos) if you pre-order an iTunes release. Amazon does allow the pre-ordering of CDs before the release date.

An updated speakers list for the Bandwidth Conference includes Alexandra Patsavas from Chop Shop Music Supervision (Grey's Anatomy, The O.C., Gossip Girl, etc.)

And on a related note, in his list of measuring sticks for music success, Bob Lefsetz doesn't mention the lucrative option of licensing tracks for T.V. or films. But he's definitely not fond of up-and-coming acts selling their songs for commercials:
As for developing acts... You don't have an identity yet. You'll be forever linked with the brand. Feist...isn't she the iPod girl? It can be a shortcut to success, but can also damage your long term career. You get notoriety and... Well, sometimes you don't even get that notoriety. The blip tends to be momentary... Hell, how many commercials can you remember from three months ago?
I won't say that there aren't downsides, but my guess is that Feist doesn't regret that ad.

tags:

link 1 comments e-mail listen to the Layaways on Spotify




June 24, 2008

How We Listen
by David Harrell
Nick Carr's recent Atlantic article on how technology has changed the way readers read (and writers write) got me thinking again about how digital music and portable devices have altered music listening habits. Then I stumbled across this great post on the eMusic blog about the ups and downs of the National. While the post is more about the idea of artist longevity and the time it takes to develop an audience, the reader comments include some excellent thoughts on how digital music (and the ever-expanding amount of available content) is affecting their listening habits:
I've been wondering if the digital download model isn't killing music in a much different way than what RIAA is worried about. There's still plenty of money to be made, especially in selling concert tickets and merchandise, but people just have so many options of music to listen to. This is one of the things I love about emusic but at the same time it can be occasionally frustrating; there's just so much music! (Particularly relevant to me tonight because I've been backing up some things to clear a little space on my hard drive.) And I don’t even do any of the file sharing stuff; I get almost all my music from emusic. But If I think back to the time when I was getting really hooked on certain bands, I was purchasing probably 1-2 albums a month; where now I get 10-15 albums, plus all the free stuff...and don't get me wrong it's great, but sometimes I feel I lack the time to really get to know a particular piece.

-----

I definitely spend less time with each album than I used to. It's not even that I get bored with albums, it's that I have 75 downloads per month, plus a few subscriptions to Song of the Day podcasts, plus music my friends give me...the end result being I can love a band one month and get so distracted the next that I forget about it.

It's a trade-off of the Internet age -- more bands to listen to, and less time to spend with each one.

-----

It's funny -- I end up getting affected by the "too much music" phenomenon in a different way: because I'm so old-school in my music listening habits, I'll get stuck on one record for a few weeks at a time. As a consequence, I start getting anxiety about all the really great stuff that's passing me by just because I can't seem to stop listening to, say, J-Live or Shearwater. There are so many records that I keep "meaning" to get to -- so many records that I know I'd probably love -- and I'm afraid I'm just going to end up missing them.
It's partially my age -- I have less time these days to stay on top of everything, but even if I could devote all of my waking hours to music consumption, my guess is that I'd still feel like I was drowning.

Is there an official name for this sort of feeling? If not, I'm proposing "content fatigue." Or maybe Richard Saul Wurman already covered it with "Information Anxiety." A suggestion to Mr. Wurman: if you ever update the book, add a chapter about digital music.

tags:

link 4 comments e-mail listen to the Layaways on Spotify




June 17, 2008

Tuesday Odds and Ends
by David Harrell
If you were wondering how Lala.com was going to handle 10-cent credit card transactions -- it won't. I just did the 79-cent upgrade from a "web song" to an mp3 file (for the lead-off track on this album) and saw the following message:
About your Lala wallet
It wouldn't make sense to charge your credit card for every 10¢ purchase, so we ask that you add funds to your wallet in dollar amounts of your choice.

This enables you to then continue to easily add web songs with a single click. The funds you add to your wallet can also be applied towards the purchase of web albums and MP3s.

We will never add funds to your wallet without asking you first.

And Amazon.com makes its daily and weekly mp3 album specials official -- here's the press release:
In celebration of Coldplay's new album, "Viva la Vida or Death and All His Friends," available on Amazon MP3 for just $8.99, this week's "Daily Deals" will be their preceding albums. "X&Y" will be available today for $1.99, "A Rush of Blood to the Head" will be available on Wednesday for $1.99, "Parachutes" will be available on Thursday for $1.99 and "Brothers and Sisters" will be offered on Friday for 99 cents. Past Daily Deals have included Madonna's "Hard Candy" at $3.99, Led Zeppelin's "Mothership" at $4.99 and Weezer's "Pinkerton" at $1.99.
I'll write more in a later post, but I'm convinced that Amazon's long-term mp3 pricing goal -- for the bulk of its catalog -- is $5 digital albums.

tags:

link 3 comments e-mail listen to the Layaways on Spotify




June 11, 2008

The Bargain Bump
by David Harrell

Amazon.com mp3 banner

When Amazon.com MP3 began running its daily "blue light special," I assumed it would feature older, back-catalog titles. But some of the bargain albums are recent, big-name releases -- today it's Madonna's Hard Candy album for $3.99.

I'd love to find out exactly what kind of bounce Amazon.com is getting with these daily specials, though it seems pretty clear that the reduced price is moving some additional units: As of this afternoon, the album is #7 on Amazon's top mp3 albums chart, but it's only in the #50 spot over at the iTunes store...

UPDATE: As of Thursday morning, it's #1, and still priced at $3.99.

related: Amazon's Blue Light MP3 Special

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link 0 comments e-mail listen to the Layaways on Spotify




June 09, 2008

The Nuge Price
by David Harrell
Given his arsenal and hunting prowess, I'm reluctant to speak ill of Ted Nugent. But I'm puzzled by the pricing for his god-awful "I Am the NRA" song -- $1.99 for a 128k mp3.

Perhaps some of that money is going to the organization he's singing about, but there's no mention of that on Ted's site. Or maybe Ted's just paying a fortune in credit card transaction fees, necessitating the 2X iTunes pricing for the direct-sold mp3. (The song isn't available in the iTunes store or Amazon MP3.) Yet at that price, you'd think Ted could break out a higher-quality sound file.

Pricing aside, I'm glad to see Ted's calling attention to one the country's most underappreciated groups -- welders:
At over four million members, the NRA's ranks are composed of teachers, cops, farmers, lawyers, welders, hero military veterans and at least one gonzo guitar player who is not afraid to speak his mind and stand up for what he believes in. NRA members believe it is our responsibility as Americans to participate in this experiment in self-government.

- Ted Nugent
Via Listening Post.

tags:

link 2 comments e-mail listen to the Layaways on Spotify




June 06, 2008

Authors On Tour?
by David Harrell
Economist Paul Krugman on the Kindle and e-books:
It's a good enough package that my guess is that digital readers will soon become common, perhaps even the usual way we read books.

How will this affect the publishing business? Right now, publishers make as much from a Kindle download as they do from the sale of a physical book. But the experience of the music industry suggests that this won't last: once digital downloads of books become standard, it will be hard for publishers to keep charging traditional prices.

Indeed, if e-books become the norm, the publishing industry as we know it may wither away. Books may end up serving mainly as promotional material for authors' other activities, such as live readings with paid admission. Well, if it was good enough for Charles Dickens, I guess it's good enough for me.
Krugman's probably right that widespread usage of digital readers will lead to decreased prices, and if P2P distribution of digital books takes off, only a minority of book downloads will be paid for. But I think he's a bit too optimistic about the "Grateful Dead" business model for books.

If there's a digital revolution for books and an accompanying switch to unpaid content, it seems likely that the traditional publishing industry would be even more screwed than the music industry. With music, there's already an established tradition and audience for live music performance, which obviously pre-dated recorded music -- and the associated merchandising of T-shirts, posters, etc. Plus, the licensing of music for film, television, advertising, and video games is becoming increasingly lucrative for labels and musicians.

Yet I just don't see the same opportunities for publishers and authors to find alternate income streams. Very few -- in any -- authors could sell out an auditorium for a live reading, let alone attract a paying club-sized audience. And it's hard to think of any licensing opportunities for book content that would be as lucrative as music licensing.

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    THE LAYAWAYS

    Out Now -- "Maybe Next Year" -- The New Holiday Album:

    <a href="http://thelayaways.bandcamp.com/album/maybe-next-year">Joy To The World by The Layaways</a>

    "This is a sweet treat, deliciously musical without being overbaked for mass media consumption." -- Hyperbolium

    "Perfect listening to accompany whatever holiday preparations you may be making today." -- Bag of Songs


    O Christmas Tree - free mp3 lyrics and song details
    Away In A Manger - free mp3

    Download from eMusic, iTunes, Amazon MP3, or Bandcamp. Listen to free streams at Last.fm.



    album cover art from The Space Between

    <a href="http://thelayaways.bandcamp.com/album/the-space-between">Keep It To Yourself by The Layaways</a>

    "...about as melodic and hooky as indie pop can get." -- Absolute Powerpop

    "Their laid-back, '60s era sounds are absolutely delightening." -- 3hive

    "...melodic, garage-influenced shoegaze." -- RCRD LBL

    Where The Conversation Ends - free mp3
    January - free mp3
    Keep It To Yourself - free mp3

    Download from eMusic, iTunes, Amazon MP3, or CD Baby, stream it at Last.fm or Napster.



    album cover art from We've Been Lost

    <a href="http://thelayaways.bandcamp.com/album/weve-been-lost">Silence by The Layaways</a>

    "The Layaways make fine indie pop. Hushed vocals interweave with understated buzzing guitars. The whole LP is a revelation from the start." -- Lost Music

    "Catchy Guided by Voices-like rockers who lay it on sweetly and sincerely, just like Lionel Richie." -- WRUV Radio

    Silence - free mp3 lyrics and song details
    The Long Night - free mp3

    Download from eMusic, Amazon MP3, or iTunes, stream it at Last.fm, Napster, or Rhapsody.



    album cover art from More Than Happy

    "These are songs that you want to take home with you, curl up with, hold them close -- and pray that they are still with you when you wake up." -- The Big Takeover

    Let Me In - free mp3
    Ocean Blue - free mp3

    Download from eMusic, Amazon MP3, or iTunes, stream it at Last.fm, Napster, or Rhapsody.

    More Layaways downloads:

    download the Layaways at eMusic download the Layaways at iTunes

    the layaways website