Article on record sales doubling and CD sale dropping

[riceboy]

I thought this article from PC World was interesting. I copied and pasted the article below:

Vinyl Revival? Records Move on CDs in 2008 - PC World

Vinyl Revival? Records Move on CDs in 2008

Lucas Mearian, Computerworld

Jan 3, 2009 10:44 am

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Audiophiles have long argued that vinyl records offer better sound quality compared to CDs or MP3s, but their stoic loyalty in the face of change was seen as little more than nostalgia over the 25 years digital recordings have dominated the music industry. In recent years, however, sales of LPs -- that's short for long-playing records -- have more than doubled online and are regaining overall market share, thanks to new converts looking for more than they can find in an MP3 selling for 99 cents online.

In 2008, 1.88 million vinyl albums were purchased, more than in any other year in the history of Nielsen SoundScan, which began tracking LP sales in 1991. The previous record was in 2000, when 1.5 million LP albums were sold. More than two out of every three vinyl albums bought in 2008 were purchased at an independent music store, according to SoundScan.

Vinyl record sales rose 14% between 2006 and 2007, from 858,000 to 990,000. In contrast, CD sales plummeted over the past three years, from 553.4 million in 2006 to 360.6 million in 2008. MP3 sales grew from 32.6 million to 65.8 million during the same time period, according to SoundScan.

Industry observers say vinyl record sales have skyrocketed because new buyers are discovering the value of owning albums, with their cover art, large liner notes and warm sound.

"There's nothing like a vinyl record. It's analog. It sounds as close as you're going to get to the artist. If you're that guy who sits in that optimum space in your living room, you're definitely going to hear the difference," said Steven Sheldon, president of Los Angeles-based Rainbo Records.

"Now, with that said, 99% of the public listens to music as a background off of iPods and everything else, but that's by far the worst sound quality. But, it's also the most convenient -- and convenience sells," he said.

Rainbo Records, which has been pressing vinyl LPs since 1955, doubled its production from 2006 to 2007 and more than doubled record output this past year. The company currently presses 25,000 albums a day; that's up from a low of about 6,000 to 8,000 a day in the late 1980s through the late 1990s when CDs were in their heyday. Since then, there's been a steady increase in vinyl production. Surprisingly, Sheldon doesn't attribute that rise to Gen Xers or even Baby Boomers, but to 13- to 24-year-olds rediscovering the aesthetic value of record collections.

"They were brought up on virtual everything. Their games were on the computer or on the TV. Their music was in a box," he said. "I think they also do recognize the difference in sound, but I think holding that 12-by-12 piece of art and holding that record in their hand is creating the buzz."

While you might think Sheldon has an ax to grind against modern forms of music recording, he doesn't. His company also produces CDs -- to the tune of 75,000 a day.

Over the past 30 years, the number of companies manufacturing LPs has dwindled, Sheldon said. But production remained relatively steady for those companies that remained in business, kept afloat by the aficionados who swear by vinyl's sound quality.

Josh Bizar, sales director for Chicago-based MusicDirect, an online supplier of turntables, needles and record cleaners, said Nielson is likely under-reporting record sales because many online and independent retail shops aren't counted.

MusicDirect opened 20 years ago, as the CD market exploded, targeting sophisticated audiophiles, Bizar said. In each of the past five years, it has seen a 200% increase in record sales and now ships between two million and three million albums annually.

LPs have made enough of a comeback that online retail sites such as Amazon.com have recently created pages dedicated to the sales of vinyl records.

SoundStageDirect.com, an online vinyl records store based in Doylestown, Penn., has experienced a 49% increase in sales from 2007 to 2008, selling 55,000 records over the past year, according to owner Seth Frank. Frank, 42, said he first worked in a record store at age 10. After college, he took a "suit" job, but hated it. So five years ago, he decided to go back to his first love, selling records.

"Records just sound better. They have that warmth to them - that analog-warm sound. A record reproduces music, a CD transforms it into zeros and ones," Frank said. "Digital to me is a harsher sound. When I put a CD on, it's the sound track of the day. It's background music. When I want to listen to music, then I listen to a record."

According to Frank, the music industry is responding vigorously to increased demand for vinyl and labels representing artists such as Nirvana, Van Morrison, Cream, Guns 'N Roses and Metallica have all recently put out new releases or re-released classic albums on new vinyl.

"Motley Crue just released all their albums in vinyl and I can't keep them on the shelves," Frank said. "Some artists who want to promote vinyl are also putting their extra tracks on them instead of CDs."

Duncan Browne, chief operating officer of the Brighton, Mass.-based Newbury Comics, a brick-and-mortar retail chain with 28 stores in five states, said his company has expanded shelf space for records over the past year in order to accommodate a more than 35% increase to date in vinyl sales to "younger people".

"I think it's a novelty thing, by and large. I think it's a faddish thing," he said. "It seems like something cool. It's a differentiator and it also gets into the DJ culture."

Browne said he doesn't expect the uptick in record sales to continue, but it will leave behind a new, younger audience of audiophiles, similar to the stalwarts who never gave up on the medium during the rise of CDs and MP3s.

Dan Phipps, manager of the Newbury Comics store in Natick, Mass., said most of his record customers are teenagers dissatisfied with purchasing music online; They want the artwork that comes with an album cover as well as large liner notes and other extras.

He said the biggest genres of music he sells are classic rock, pop or new hip-hop albums.

It's not just the vinyl that's selling. Phipps pointed to a large stack of boxes containing turntables that have been upgraded with USB ports that can be used to transfer LP music to digital mediums. Today's turntables are a pricier, however, than they used to be. A Thoren's turntable can run as much as $6,200. Even pricier models from Clearaudio run as high as $150,000. But take heart, a simple Sony , Panasonic or Stanton turntable can still be bought for a little more than $100.

According to MusicDirect's Bizar, a decent player should now cost about $350. For that, you'll have a turntable for life, he said.

Audiophiles who haven't listened to an LP lately will likely find that the quality of sound on today's albums surpasses that of the old-school vinyl of the 20th century, according to Bizar and others.

In the 1980s, companies pressed vinyl into records weighing 120 grams. Today, records are thicker, weighing in at 180 grams -- and they're recorded with more sophisticated electronic equipment, Bizar said.

"Look. It would take me 2 minutes to play you a CD on a 3,000 CD player and then play the same music using vinyl on $500 turntable and you will choose the vinyl every time. I'm not an audiophile, but 100% of time, I choose vinyl," he said.

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[aardvark baguette]

In contrast, CD sales plummeted

Despite my best efforts

[Beefy]

[rant]

The clear potential musical benefits of CD/digital music over vinyl/analogue is that you have a massive dynamic range to work with and your music is free from the clicks and pops of dust etc. But the stupid f^%# recording engineers waste it all by turning the CD loudness up to maximum so that the dynamic range exists between 100 and 105dB, and you gets clicks and pops from the music clipping. Stupid, stupid, stupid.

[/rant]

That being said, I'd love to hear a good vinyl rig one day, to see what all the fuss is about

[4N6]

Thanks for posting this Riceboy! I also agree that vinyl, when properly spun (clean record with well set-up turntable/tonearm/cartridge) will sound better than a CD. This is a generalization, however. In this months Absolute Sound, the music reviewer listened to some new reissues of older rock albums and found that a few of them sounded poor and seemed to be poorly pressed (dust and hairs on a new LP) and noisy.

I also agree with the article that you really do not need to spend a fortune on a good LP rig. A new Rega P3-24 with a good cartridge and phono preamp could be had for $2000-2500 and will keep up with many MUCH higher priced CP players.

[grawk]

Thing is, the record sales doubling wouldn't be a blip on the volume of cd sales. The markets are orders of magnitude different.

And most people would say $2500 is a fortune for a turntable.

[Pars]

Thing is, the record sales doubling wouldn't be a blip on the volume of cd sales. The markets are orders of magnitude different.

And most people would say $2500 is a fortune for a turntable.

There are alot of people who wouldn't even consider spending $1000 for their entire system...

And I thought CD sales were going in the crapper (due to MP3s)? I don't hang out at Best Buy much at all, but do buy a CD occasionally there. Their CD section seems to have shrunk alot.

[hungrych]

If they want to sell more cds, they shouldn't make them cost so fucking much to buy new.

[manaox2]

I think it may have something to do with most music that gets attention (in the media) currently is continuously becoming less and less worthy of buying (artists looking pretty, music's shitty).

[deepak]

If they want to sell more cds, they shouldn't make them cost so fucking much to buy new.

Other than imports and CDs on small labels (including audiophile labels), CDs are pretty reasonable...

[grawk]

It's a value perception problem. CDs are $15-20 when DVDs are also $15-20.

But really the problem is that the music that's getting distributed is terrible.

[Pars]

If you want to go back to when CDs were introduced, most vinyl single LPs of the time were around $7 (IIRC ). The record labels promised that these new CDs being introduced would drop in price from the initial $15 or so down to less than LPs due to economy of scale once production ramped up. This of course never happened (the dropping of price, not the ramp up). And yes, the record labels are hitting it out of the park in terms of new talent

[grawk]

Given that CDs were introduced in 1984, I'd say that $15 today is comparable to $7 then...

I'd gladly pay $20 for good quality recordings from good bands. I do, often, in fact

[hungrych]

Other than imports and CDs on small labels (including audiophile labels), CDs are pretty reasonable...

16 bucks a cd is just way too much for most people, especially when most of it isn't going to directly to the artist anyway.

[Knuckledragger]

$16 for a CD that has maybe 2 good songs on it is a terrible deal.

[LFF]

$16 for a CD that has maybe 2 good songs on it is a terrible deal.

SO TRUE! I think a CD at $9.99 or less is a good deal. Most of the CD's I buy cost me about $4.00 - $6.00. I will pay more for an LP or CD IF, and that's IF, I know the mastering is top notch (Steve Hoffman, Kevin Gray, Vic Anesini, Barry Diament, Joe Tarantino, etc).

[Dusty Chalk]

People in Europe typically pay 2ce what we pay for CD's, simply because they care about music more.

[Torpedo]

People in Europe typically pay 2ce what we pay for CD's, simply because they care about music more.

We try to buy at US and Japan online stores which usually have better prices, specially now that USD and Yen aren't very strong against euro.

I care about music and I like thinking that the money I spend in a CD helps the artist to keep his/her work, but I hate the idea of feeding the big music companies that much. I avoid buying discs at 16-20 euros (average price of new releases in most department stores, which have been shrinking their music sections more and more in the last three years) if I haven't heard them before and I know for sure they're worth every penny.

I think people are downloading most of their music for free. In Spain any HDD, memory card, CD-R, DVD-R, DAP... whatever physical media to hold data -hence music-, and the devices to burn it, pays a fee -they call it "canon"- to the Spanish equivalent of RIAA, named SGAE. They take as fact you'll be using it to hold pirate films and music Here it's not a punishable guilt the fact of downloading music using P2P, or making your copies, unless you're making a profit from it. But as far as they blame it for the music sales drop, they charge everybody with that damn fee to support the SGAE and the bastards ruling it. Funnily enough the proceedings from that fee are shared among the artists considering their sales, so probably the ones being more downloaded, who should get more compensation, aren't being more paid...

IMHO the sales drop is related to free downloads for a big part, but also for people caring less and less for music as in albums, and being more prone to get individual songs that they like. It's amazing that ringtones are selling a lot.