Excerpt: Merge Records became the latest to join the field with the recent launch of its online emporium, which, according to label president Mac McCaughan, features "high-quality MP3s and full FLAC (free lossless audio codec) files of recent, older and out-of-print titles, including all the early Merge singles, as well as the Superchunk 'Clambakes' series." The store will also eventually host exclusive tracks, remixes and video content, in addition to the label's catalog.
Excerpt: Given the wealth of options available to indies that want to peddle their merchandise online, why would a label want to sink the time and money into developing its own store? Merge wouldn't divulge how much it cost to build its online store, but it did say that most of the expenses were upfront. And whatever profits it makes will go directly to the label and bands, Merge publicist Christina Rentz said. "There is no middleman taking fees, so we are the only ones who benefit."
Excerpt: And when the newer stuff does sell, it sells for pretty much the same price it would on iTunes. Merge will sell its tracks for 99 cents each; Def Jux's albums are $9.95 each, and Sub Pop's are $9.90. McCaughan said he chose the price structure for philosophical reasons: "Driving down the price of downloads will devalue the music."
Excerpt: Apple's iTunes will likely whip past Wal-Mart Stores to become the largest U.S. music retailer sometime this year.
Excerpt: The NPD Group issued a report Tuesday that said Apple had outpaced Best Buy and Target to become the No. 2 U.S. music retailer. Unless the downward trend in CD sales suddenly reverses, Apple will be No. 1, said Russ Crupnick, the NPD Group's president of Music.
Excerpt: Then there is the teen market that is abandoning CDs in droves. According to the report issued by NPD on Tuesday, nearly half of all U.S. teens (48 percent) did not purchase a CD last year. That is up from 2006, when about 38 percent of teens made no CD purchases. Older music fans are transitioning at a slower rate but it's happening there too. In total, NPD Group said that the music industry waved bye-bye to about 1 million CD buyers last year.
Excerpt: Teens lack credit cards and this often prevents them from buying at almost everywhere but iTunes, Crupnick said. Apple avoids credit cards by pushing the gift cards, which teens can pay for at retail locations and then use them to purchase songs online by keying in a code. No credit cards needed. "That's the question that the music industry has to answer soon," Crupnick said. "How do we get young people to start paying for music again? They've got to make it easier for teens to buy online. Apple CEO Steve Jobs has done a wonderful job of this. Teens have a way to do commerce with iTunes."
Excerpt: Yorke told BBC Radio 4's Today programme that 80% of people still buy physical releases and it was important for the band to have "an object".
Excerpt: Yorke rubbished reports that the album was downloaded 1.2 million times in its first week alone - but refused to confirm any figures. "It's total nonsense. Thanks very much - we're the only people who know, and it feels wrong to say exactly what happened. But it's been a really nice surprise and we've done really well out of it."
Excerpt: You might think, if you didn't work in the music business, that famous artists stand to make mad cash from popular albums on iTunes and other digital storefronts. Sadly, that's not the case, and Radiohead frontman Thom Yorke has spent the last week calling out the labels for it. He recently told BBC Radio 4 that "the big infrastructure of the music business has not addressed the way artists communicate directly with their fans. In fact, they seem to basically get in the way. Not only do they get in the way, but they take all the cash."
Excerpt: "Don't sign a huge record contract that strips you of all your digital rights, so that when you do sell something on iTunes you get absolutely zero. That would be the first priority." He went on to say that selling the new album, In Rainbows, directly to fans made the band more money from digital distribution than "all the other Radiohead albums put together, forever."
Excerpt: Recording costs have declined to almost zero. Artists used to need the labels to bankroll their recordings. Most simply didn't have the $15,000 (minimum) necessary to rent a professional studio and pay an engineer and a producer. For many artists — maybe even most — this is no longer the case. Now an album can be made on the same laptop you use to check email.
Excerpt: Where there was one, now there are six: Six possible music distribution models, ranging from one in which the artist is pretty much hands-off to one where the artist does nearly everything. Not surprisingly, the more involved the artist is, the more he or she can often make per unit sold. The totally DIY model is certainly not for everyone — but that's the point. Now there's choice.
Excerpt: No single model will work for everyone. There's room for all of us. Some artists are the Coke and Pepsi of music, while others are the fine wine — or the funky home-brewed moonshine. And that's fine. I like Rihanna's "Umbrella" and Christina Aguilera's "Ain't No Other Man." Sometimes a corporate soft drink is what you want — just not at the expense of the other thing. In the recent past, it often seemed like all or nothing, but maybe now we won't be forced to choose.