Sitting at Café Centro and musing over the travails of the music business.
Part one of a two-part series.
As someone who hopes to one day make a dime, maybe two, in the music business, I read a fair number of articles describing how the business fairs. A few discuss what’s going right, but mostly the articles are about what has gone wrong. The positive articles tend to focus on supply (there is more music than ever before!), while the negative articles focus on demand (no one wants to pay for anything anymore!). Oddly, however, I have never read an article that tackles the overall issue on the basis of these simple terms, supply and demand. Instead, everyone wants to talk about clouds and social media and content and on and on and on and on and on.
But what of venerable supply and demand?
Here’s my theory: Supply is way up, and demand is up maybe a little, as a result pricing has dropped. Too simple? Perhaps, buy hear me out:
SUPPLY – There is more music out there than ever before, because the tools for making it are not only widely available, but they are cheap and easy to use. In addition, the cost of distribution is nearly zero, and even if you choose to go all pro for distribution and use something like Tunecore, you’re still talking tens of dollars, not tens of thousands – even if you go GLOBAL. I mean, it’s incredible how cheaply music can be distributed these days.
DEMAND – In my humble opinion, there is not appreciably more demand for music today than there was ten years ago. Sure, people have MORE music than ever before, but I’m not so sure they WANT more; instead, music is so easy to come by and store, why not have a virtual warehouse full of the stuff everywhere you go?
To sum up, I think what has happened in music is akin to diamonds suddenly becoming cheap and easy for anyone to make at home. If this were to happen, the price of diamonds would fall, don’t you think? But here’s the weird thing about music: every effort is being made to hold prices constant in the face of an exponential increase in supply. Don’t believe me? Consider the price of tracks on iTunes, there $.99, or roughly the same as a per track cost of a physical CD. This is not Apple’s fault. Instead, it’s the result of record companies trying desperately to maintain cost structures devoted to manufacturing physical products, even as the market for those physical products dries up. Pretty pathetic.
So what is a starving musician to do? Tomorrow, I bring you Part Two, The Solution!