Has digital music turned the corner?

[wade moore]

http://news.yahoo.com/s/nm/20060108/wr_nm/digital_dc

Digital music enjoys a dream week <!-- END HEADLINE -->
<!-- BEGIN STORY BODY -->By Brian Garrity Sun Jan 8, 5:04 PM ET



LOS ANGELES (Billboard) - There was so much legitimate downloading in the final week of 2005 that it recalled the impossible tallies research firms used in the late 1990s to dazzle venture capitalists and scare the daylights out of major-label executives.

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In the seven-day stretch between Christmas and the new year, millions of consumers armed with new MP3 players (primarily iPods) and stacks of gift cards gobbled up almost 20 million tracks from iTunes and other download retailers, Nielsen SoundScan reports.

In the process, consumers shattered the tracking firm's one-week record for download sales.

A look inside the numbers shows just how unprecedented a week it was for the download business:

- Before the week ending January 1, 2006, the record for the most downloads sold in seven days was 9.5 million tracks -- set just one week earlier.

- Sales of 20 million songs were almost three times the amount of digital tracks sold in the same seven-day span a year ago.

- Fifteen songs on the current Hot Digital Songs chart surpassed the one-week record for sales of a single track.

- Rap group D4L's "Laffy Taffy" took the top spot with 175,000 tracks sold, more than doubling the mark of 80,500 downloads Kanye West's "Gold Digger" set the week of September 17.

- Each of the top 11 titles on the Hot Digital Songs chart sold more than 100,000 downloads.

For the year, the digital track sales tally reached 352 million -- a 147% increase over 2004's total of 142.6 million.

In comparison to the volume of music that is downloaded through peer-to-peer networks, those numbers may not seem like much. P2P monitoring service Big Champagne estimates that at least 250 million tracks are downloaded worldwide each week from file-swapping services.

But a dramatic rise in the tide of authorized download sales in recent weeks suggests that changes may be afoot in the consumer's relationship to digital music.

The important question for the music business is whether 20 million downloads represents the new baseline for digital track sales. A year ago, a 33% pop in download sales in the week following Christmas permanently raised the bar on weekly download volume by 2 million tracks.

Technology and distribution executives at the major labels are not holding their breath that download sales will now run at a rate of almost triple the 7 million tracks that were being sold on average in December. They say big sales of gift cards are likely creating the current volume of such significant downloads.

Yet gift cards were available in 2004, too. If the market can retain volume gain as it did last year, the numbers are tantalizing. Last year, sales fell by about 20% in the weeks following New Year's; such a drop this year would yield a weekly volume baseline close to 16 million tracks. That would put the download market on pace for sales of 750 million to 1 billion tracks in 2006.

Likely to drive the download business is the fact that the number of iPods and other MP3 players in distribution have exploded in the last year. The Computer Electronics Assn. estimates that MP3 player revenue increased 200% to more than $3 billion in 2005.

Apple claims to have sold more than 30 million iPods to date, but will likely have shipped a total close to that number in 2005 alone.



Research firm NPD Group estimates MP3 player revenue at leading retailers topped $500 million on sales of more than 3.3 million units for the five weeks between Thanksgiving and Christmas--a 65% jump in dollar volume from the 2004 holidays. Sales of MP3 accessories were big too, topping $160 million during the five-week period.

NPD figures exclude direct sales of iPods through Apple Computer and online sales.

And for the first time, sales of MP3 players are surpassing sales of personal CD players and CD shelf systems, NPD reports. "We have definitely moved," says Stephen Baker, VP of analyst services for NPD, "from MP3 players being a computer-oriented product to a consumer-directed product."

[jeff061]

It'll be interesting to see if RIAA gets it, like I think the MPAA does, or if they just keep raising royalties in a fruitless effort to bring back and keep consumers on CDs.

[ice4277]

- Rap group D4L's "Laffy Taffy" took the top spot with 175,000 tracks sold,
Well, at least it is comforting to see that everyone's love for shit music will remain strong in the digital age.

[wade moore]

So.. my thoughts --

Have your music buying habits changed? I know that I personally bought my first full album in November (I had bought individual songs previously on a somewhat regular basis) from iTunes and that was before I got my iPOD for christmas. I imagine a majority of my music purchasing in the future will be from iTunes. Now and then I may want the actual CD with liner notes, etc... but it has become cheaper and easier to do it on-line.

So.. how have your habits changed? I'm not interested in those stealing music, but how purchasing habits have changed.

[path12]

So.. my thoughts --

Have your music buying habits changed? I know that I personally bought my first full album in November (I had bought individual songs previously on a somewhat regular basis) from iTunes and that was before I got my iPOD for christmas. I imagine a majority of my music purchasing in the future will be from iTunes. Now and then I may want the actual CD with liner notes, etc... but it has become cheaper and easier to do it on-line.

So.. how have your habits changed? I'm not interested in those stealing music, but how purchasing habits have changed.

I do probably 75-80% of my music buying online now, with the exceptions being those discs that I do want the liner notes and packaging for. I also buy much fewer entire albums now, the majority of my online buys are singles.

I tend to go on one $25-30 spree a month on iTunes.

[Ksyrup]

The only music I purchase as downloads are those releases I can't get on a CD. Itunes still hasn't offered enhanced quality MP3s, has it? I'm not so much interested in music that only sounds good in my headphones. I want stuff I can burn to a disc and crank in my car without loss of precision. I still haven't found my comfort level with downloadable MP3s to that extent. And I still like the idea of "collecting" CDs and having a physical product in my hands - although I'll admit that I'm running out of space for all of my CDs, and I haven't been burning bootlegs for a long time because of space concerns.

[Ben E Lou]

KSyrup is dead-on. The loss of quality with MP3s is very annoying.

[gstelmack]

KSyrup is dead-on. The loss of quality with MP3s is very annoying.Which is why when I've bought downloadable tracks I've done it through PressPlay or MSN Music where I can get high-quality WMAs...

[wade moore]

I don't think my ear is fine-tuned enough to notice any quality loss, which is probably a major plus for me..

I'm by no means a musician and probably at least somewhat tone-def... when I listen to my mp3's on the computer, on my home speakers, in the car, i don't notice quality problems...

[Julio Riddols]

Wait.. wait.. LAFFY TAFFY was the most downloaded song? What the hell is wrong with America?

[jeff061]

Would you prefer Crazy Frog?

[cthomer5000]

KSyrup is dead-on. The loss of quality with MP3s is very annoying.
Unless you're encoding them at an extremely low rate, they are absolutely fine. And this comes from a bonafide music maniac who owns 1,200+ physical CDs alone.

And yes, my habits have changed radically. I never buy a physical CD anymore unless absolutely necessary (meaning it cannot be found for digital purchase).

I've gone from buying 1 CD a week to buying 1 in the last 5-6 months. But I'm buying as much music as ever, if not more.

[jeff061]

At 128 ,which I consider low, I most definitely notice the loss of quality. 128 used to be considered the norm, not sure what iTunes encodes at.

[GrantDawg]

I still do not own an mp3 player, and I have purchased maybe 3 downloadable songs.

[Ben E Lou]

At 128 ,which I consider low, I most definitely notice the loss of quality. 128 used to be considered the norm, not sure what iTunes encodes at.I can tolerate 192, but not 128 or 160.

[oliegirl]

Now and then I may want the actual CD with liner notes, etc...

Just out of curiousity...why would you want the liner notes to the cd? The lyrics can be found online, and other than the "thank you's" they include and some pictures of the band, what else is in there? I haven't bought a physical CD for myself in a long time, over a year. I buy them for Anthony b/c he has a CD player in his room but no MP3 player (for obvious reasons)...but never for myself anymore.

[Hurst2112]

There is something to be said about going to a cd store, walking around endless aisles of cds...stopping to look at the t-shirts, pipes, etc. ;)

I love that. My generation (X) is the last gen that will say they did that on a consistent basis. I bought my first record (ACDC's Dirty Deeds) at a headshop. Still remember the smell of inscense and the darkness of the store.

It's sad really.

[moriarty]

At 128 ,which I consider low, I most definitely notice the loss of quality. 128 used to be considered the norm, not sure what iTunes encodes at.

If I download from iTunes and burn to a CD as MP3 (not sure what the default iTunes format is) ... what type of quality can I expect 128, 160, 192 ... better?

[st.cronin]

There is something to be said about going to a cd store, walking around endless aisles of cds...stopping to look at the t-shirts, pipes, etc. ;)

I love that. My generation (X) is the last gen that will say they did that on a consistent basis. I bought my first record (ACDC's Dirty Deeds) at a headshop. Still remember the smell of inscense and the darkness of the store.

It's sad really.

That era is definitely over. I remember meeting girls shopping for music as a teen.

[Hurst2112]

Just out of curiousity...why would you want the liner notes to the cd? The lyrics can be found online, and other than the "thank you's" they include and some pictures of the band, what else is in there? I haven't bought a physical CD for myself in a long time, over a year. I buy them for Anthony b/c he has a CD player in his room but no MP3 player (for obvious reasons)...but never for myself anymore.

As an audio engineer....liner notes are worth more to me than my measly paychecks.

It's something special to see your name on a CD. Knowing that there is a written and audible archieve of your work is worth it's weight in gold.

Engineers are strange that way.

[wade moore]

Just out of curiousity...why would you want the liner notes to the cd? The lyrics can be found online, and other than the "thank you's" they include and some pictures of the band, what else is in there? I haven't bought a physical CD for myself in a long time, over a year. I buy them for Anthony b/c he has a CD player in his room but no MP3 player (for obvious reasons)...but never for myself anymore.It's something difficult for me to explain... because, well, there's not really a lot of logic to it..

This is generally for bands that I really like or a small band that I've seen in a small venue, etc... I guess it's one of those where there's just "something" about having the actual CD..

Like I said, logically, there is no reason.. I think it is more of an emotional response...

[Hurst2112]

If I download from iTunes and burn to a CD as MP3 (not sure what the default iTunes format is) ... what type of quality can I expect 128, 160, 192 ... better?

if you wish to get really technical, even a copy of a cd will not sound the same as the orig. too many variations. There is a sound loss when buring disc to disc. mostly inaudible but some people can hear it.

i can't. i can make out high frequency issues with mp3s which annoy the hell out of me. aliasing and things like that. even at 256kbps the cymbals and guitars sound 'smeared' to me.

[moriarty]

if you wish to get really technical, even a copy of a cd will not sound the same as the orig. too many variations. There is a sound loss when buring disc to disc. mostly inaudible but some people can hear it.

i can't. i can make out high frequency issues with mp3s which annoy the hell out of me. aliasing and things like that. even at 256kbps the cymbals and guitars sound 'smeared' to me.

Agreed, and I know MP3 isn't the greatest compression technology for perserving music quality. Just wondering how 'bad' it would sound if I used iTunes and created an MP3 CD. Guess I'll try it and find out. 192 ripped from a CD is good enough for my ears, but I do notice the difference down at 128.

[Hurst2112]

Agreed, and I know MP3 isn't the greatest compression technology for perserving music quality. Just wondering how 'bad' it would sound if I used iTunes and created an MP3 CD. Guess I'll try it and find out. 192 ripped from a CD is good enough for my ears, but I do notice the difference down at 128.

are you making an audio cd from a list of mp3s? or an mp3 'data' disc for use in an mp3 player?

The conversion from mp3 to cd audio will probably be ok for you. though, understand that it is making a format into another format and is 'filling in the blanks' to essentially up-sample the music.

[oliegirl]

As an audio engineer....liner notes are worth more to me than my measly paychecks.

It's something special to see your name on a CD. Knowing that there is a written and audible archieve of your work is worth it's weight in gold.

Engineers are strange that way.

That I can completely understand, I'd feel the same way if my name was in print on a CD...very cool!


It's something difficult for me to explain... because, well, there's not really a lot of logic to it..

I can also understand that too :) I was thinking you guys were going to come back with some obscure information that is on the liner notes, like the importance of knowing where it was recorded, or who played what on which song, etc...these are both very reasonable answers

[wade moore]

That I can completely understand, I'd feel the same way if my name was in print on a CD...very cool!




I can also understand that too :) I was thinking you guys were going to come back with some obscure information that is on the liner notes, like the importance of knowing where it was recorded, or who played what on which song, etc...these are both very reasonable answers
If you want to get even more irrational... I often don't even open the liner notes ;)...

[Hurst2112]

If you want to get even more irrational... I often don't even open the liner notes ;)...

effin elitist!

:D

[wade moore]

effin elitist!

:D
:cool:

[Emiliano]

So.. my thoughts --

Have your music buying habits changed? I know that I personally bought my first full album in November (I had bought individual songs previously on a somewhat regular basis) from iTunes and that was before I got my iPOD for christmas. I imagine a majority of my music purchasing in the future will be from iTunes. Now and then I may want the actual CD with liner notes, etc... but it has become cheaper and easier to do it on-line.

So.. how have your habits changed? I'm not interested in those stealing music, but how purchasing habits have changed.
Very interesting article.

Basically, I'm in the same situation as you. My habits do have changed.

I got an iPod for Christmas too, and started using iTunes a month before. I purchased a lot of single songs, and recently 3 full albums. I absolutely love it. It perfectly fits my needs for music (although the Italian version of the store doesn't have all the stuff that you have in the US, but I can live with that...).
Right now, I'm finding myself buying old titles on CD at discount prices (when I found 'em...) and new releases from the iTunes music store. I love buying CDs, but generally I don't pay the insane 25/30 € they want at the stores for a new release. I simply don't buy it then, or I buy it online but you rarely find the discount on new releases. With iTunes, you can pay 9.99 € and get the new album on release day.