Also I think pop music surfed a baby boom that just isn't there demographically any more. There are noticable changes everywhere - so many one man singer-songwriters at the moment because starting a band, lugging drumkits into a van, and driving around to near-empty pubs feels like a waste of energy.

Digital sales mirror the real world - ie highly marketed major artists - but I still hold out hope that new musical waves, new tastemakers, new stars and systems, new scenes can emerge via digital. It is over-democratic at the moment. Over atomised.

I think the lack of comments here testifies to the decline of the UK - nay - world music scene since the introduction of computers and associated games and downloading. My son is a pitch perfect brilliant pianist but spends most of his time doing something else. Year’s ago he might have been involved in a band.

Interestingly enough, IFPI does not touch on the rapid growth of p2p stream-your-own-music services, like Simplify Media, ZumoCast, Didiom and ORB.

The IFPI is hardly an impartial organisation. They are well known for "creative" use of statistics.

What a naive piece of reporting. How about another myth to dispel

"The global recession will not impact music sales"

Both online and offline music sales declined in 2010. In countries where austerity measures were worse -such as Spain, consumer cash was reduced the most dramatically. This, combined with with high costs of items viewed as more essential -food, fuel, and an unrealistically high dollar value meant that many people round the world had no surplus money to spend on optional items, such as music.

See that? I've just come up with a completely different explanation for last year's decline, one that is equally defensible. That's what journalists are meant to do: analyse and opinionate, not believe press releases from companies or their representatives.

I think music will do just fine without a 'music industry'. Thanks.

*
ParkyDR

20 January 2011 8:35PM

The IFPI is hardly an impartial organisation.

So true. And yet this is the second article/ column today on which I've commented that perhaps a (presumably still?) impartial media outlet should show an element of impartiality in its reporting, rather than taking a PR story as gospel truth.
A question, anyway. What does the IFPI, this wonderful organisation that really is prepared to take piracy at face value from a business point of view and really has no axe to grind, have to say on the data that suggest that apart from a hardcore of 'pure' pirates, there is a large fringe of people who listen to music through whatever source - including illegally shared or downloaded tracks - and then go on to buy said music? Do they also count as illegal sales? Is there any recognition that for some consumers, if they can't hear the music they're not going to buy it, and with the chronic state of Radio 1's playlisting, 'illegal' sources may be their preferred option?

doh - preferred option for their first exposure to an artist or track, before they buy it

As has already been said the figures can be interpreted in different ways, but as to the effect on the unearthing of new talent the article assumes that there is only one way to find new music. In the indiepop scene, the internet has created a global community of bands, labels, writers, DJs and listeners. Nobody is going to get rich, or famous beyond the scene itself, but fantastic music is being written, recorded, released, bought and cherished. I can't say for sure but I bet the same could be said for all sorts of genres of music. There is an alternative to the major label money machine and bland X Factor nonsense, all you have to do is put a little effort in.

There is no question that all the above reasons have contributed to the decline of the music industry.
A fair assumption is also that the proliferation of music available to everyone is making it so hard for the average consumer to find new music it will never be discovered by them.

The music industry had it's golden age in the 80s and 90s and it is doubtful that golden goose will come back anytime soon.

However what's forgotten so often when pro piracy advocates or people who simply don't care express opinions like "good music will never die" is the cost of actually making that music.

Yes the argument that you can make music on a laptop and still create a hit record is absolutely true.
However even if you keep your costs down to a minimum., recording an album with 5 piece band to a decent standard will set you back anywhere between £5-10K. That is assuming you've got some favours to pull...

As the band is not making any money from the record, everyone has to work and save up his/her part.
To try and make up some loss the band decides to go on a tour around the country but without any funds for marketing the average pay for each gig 50 quid a head, of which half goes to food, gas etc.
With a steady job the only time the tour can happen is during their holidays.
This of course mean that apart from the strain this will take on relationships with family and partners, none of the band members will actually get any time of to just relax......

Whatever money is earned from the touring, which will not be much, can of course be put back into buying merch to sell, marketing and new recordings..

If the band keeps this up for 5 years then chances are that they'll be able to attract a large enough audience to their gigs to sustain both the tour, cost of a new record and some change in the pocket.

Of course this means all weekends and quite a few weeknights will be spent either creating new material, gigging, rehearsing or working on marketing for the band and.... making time for social interaction, not that there'll be much of that........

All of this with a most definite certainty of never making enough money to get a mortgage, have a summer holiday once per year or any of the things that most professionals more or less take for granted.......

New music will never cease to be created but why people refuse to pay, even the smallest amount, to have it is beyond me........

@bristoltraffic

I don't doubt that recession has accelerated the decline, but this is a decline that started way before the global recession – more than 7 years ago.

@LondonManc

I'm the first to question "scientific studies" and stats (what questions were asked, how many people participated, who paid for the study etc). However, these are stats of revenue, declared to government bodies in each country. Sure, you can debate what the reasons for the decline are, but the fact remains that revenue from recorded music in Spain – to use one of the worst cases – has more than halved in the past 5 years.

Also, judging by your moniker, I assume you like in the UK, which means you can go on Spotify, YouTube or the multitude of other free legal streaming services to check out music before you buy it. That's what I do.

Sorry, of course I meant "I assume you live in the UK

Switching to fewer bigger and 'safer' artists will only help the music industry die in my opinion.

Where the industry went wrong was in the way it tried to stop illegal downloading. Legal and government legislation isn't going to keep up with the pirates. They really needed to push harder into legal downloading and other 'instant gratification' services online like Spotify (not that that is perfect).

The news that tracks will only soon be available to buy upon the song getting airplay rather than waiting six weeks as of now just shows how the music industry is still its own worst enemy. It needed to start doing that literally years ago.

Crap though most record labels are, artists aren't going to easily survive without them.

Illegal downloading will not be stopped by prosecutions and changing the law, it will be significantly reduced by making it easily available legally. Whether that is possible financially is another matter admittedly.

Unless I missed it, the report seldom dwells on the growth in sales or the implications of such growth. Using the figures given by IFPI and BPI over the years I've seen a rather healthy set of sales data emerge in the UK where growth has been the order of the day (see slides 22-24 here which go back to 1997). Europe has also seen growth, if not on the same scale. I guess something must be rotten if increased sales equate to a decline in profit...

An increase in singles sales points to the tyranny of the album format for the casual listener who, historically, purchased said album on the basis it was as good as the singles - only to be disappointed in some cases. Not anymore. This may not be great news for the industry, nor the inconsistent artist, but it is more empowering to the consumer who has long been subject to disproportionate value/cost relationships.

I thought the touring and ticket price issue was interesting though. One wonders if more tickets would be sold if their face value wasn't so high? Perhaps an Easyjet business model with regards to ticket prices might help locate a 'sweet spot' for costs? You can seldom expect 'fans' or 'casual listeners' (as if the two are mutually exclusive!) to fork out >£25 per ticket for the band with 2 good singles, a mediocre album when the value/cost doesn't seem beneficial.

In case you want the opposite position to the IFPI report, then TorrentFreak are always ready to query the industry's PR machine in their own inimitable manner.

You write that the IFPI report 'serves to dispel some myths' but I do not think you have made your case.

Firstly, it clearly begs the question to describing the proposition that 'the loss in recorded music revenue is not due to piracy' as a myth. It is not at all clear that the contrary proposition has been demonstrated to hold.

So far as I am aware, the major labels have yet to produce any evidence to show that the loss in recorded music revenue *is* due to piracy: attempts have been made to show this but each time I have read the actual study it has turned out to have serious methodological flaws, such as assuming that every illegal download is a lost sale.

In this case we have the following: "The IFPI chief executive, Frances Moore, calculates losses on the basis that one in every 10 illegal downloads is a lost sale."

Where does that one in ten figure come from? It is better than calculating losses on the basis that every illegal download is a lost sale, as has been done in the past - at least it acknowledges that many illegal downloads originate from people who would not have bought anyway - but it really isn't much better. I too can pull statistical analysis out of my arse: we could just as easily calculate the impact of illegal downloads on recorded music sales on the basis that two out of every 10 illegal downloads do lead to a sale.

In fact, to acknowledge that many people who download illegally would not otherwise have bought the track is to acknowledge that tracks are being heard by people on spec, to see if they like it. Moore's assumption is that nine out of ten do not (itself something worth unpicking in terms of the quality of music output) but also that one out of ten does - the mythical 'lost sale'. How can Moore be so certain that that alleged 'lost sale' is indeed lost?

It makes no sense. This one out of ten has found something they like. They are now a fan. They are highly likely to go out and buy in future - either the thing they have downloaded, or merchandise, or a concert ticket, or further back catalogue items from the artist they like, or all of those things.

No-one knows for sure what the impact of illegal downloads on sales is, but a consistent picture seems to have emerged where industry-led studies seem consistently to find that illegal downloading has a negative effect, while independent studies consistently find either no effect or that it actually has a positive effect.

See for example the work of Oberholzer-Gee and Strumpf, Sinnreich and others.

What is clear is that the major labels are in decline, and their insistence on assuming a priori that illegal downloading is hurting sales is clearly part of that decline. It has never been shown to be the case and studies exist to show that the case may in fact be the opposite.

How can sensible business decisions be made in such an environment? Especially an environment which appears to be based on specifically targeting actual fans and fan behaviour.

No company that declares war on its own customers can last long. This study is part of the war that the major labels have declared on music fans. It's insane, and it's depressing. It also deserves significantly more critical attention than displayed in this article.

This looks like a PR piece the Guardian was forced to publish

Here's a bit of balance:

http://www.techdirt.com/articles/20110120/16182512748/ifpis-annual-attack-piracy-once-again-riddled-with-errors-bogus-claims.shtml

Music will ALWAYS be alive. Whatever your feelings on music in it's current form - we will always be able to buy a HARD COPY of a 'credible' release/something worth buying. Well, maybe not. Perhaps Music will become a ' Faceless series of noughts and one's forever!' A Blind Noise destined to be lost forever...

I love the way in discussions like this you always get a few who seem to think that the zenith of musical history was c. 1976, centred somewhere around Uriah Heep or perhaps ELP. You are all my dad and I claim my £5.

Anyway, as an independent artist, who runs a small label to self-release music, and also releases on various other small indie labels, who (these days) makes most of his music money through playing live, I can say that the last year or two have been tougher than ever. Sales are dropping, and live revenues too are dropping, because of the increased supply of artists who no longer make a living off sales alone & thus turn to the gig circuit.

One thing that doesn't get mentioned often, but I consider it to be a major factor, is that while the internet has lowered the barriers to entry into the industry (any kid with a laptop can get a crack of some software to produce their own music; digital distribution means anyone can start a label with no capital, etc etc), it has also led to a vast increase in the supply of music.

On balance, I'd say this is neither a good nor bad thing - on one hand, I think we're seeing a few more genuinely talented musicians come through, but on the other, we are all now somewhat deluged with mediocre music too. The upshot being, that all artists and labels take a haircut as the shrinking pie is divided up between a much much larger number of people.

@stolducky

I agree with your point about abundance and choice in the current era. However, I can't agree with your first point and I shall not give you your £5 until you point out where this 1976 claim comes from. In terms of global sales Singera (2002, Financial Times) showed that the zenith came around 1999/2000 with around $45 billion being made. Not the point you are making, I guess but I thought it worth mentioning

@Helienne Lindvall

This is ever shadier stuff Ms. Lindvall. There is no argument here that can't be uncovered as totally specious as RobJewitt and WayneMyers have already shown (I note no response to either of them?). The nonsense on display ranges from the opportunistic (the repeated use as a core case-study of that most stable and predictable of economies - SPAIN!?!?!?) to the frankly absurd and incomprehensible ("The IFPI chief executive, Frances Moore, calculates losses on the basis that one in every 10 illegal downloads is a lost sale." - WHY? Based on what possible reasoning?).

This is propaganda. Essentially meaningless statistics that are being spun to fit a pre-determined narrative. And you haven't even done it well. Disgraceful.

@RobJewitt

I meant qualitatively! Agree on sales, although looking back over the comments I think I conflated a couple of different websites and got confused.... it was probably that torrentfreak article.

(there are always a handful arguing that music was good in the 70s and that's why it sold lots, but it's all rubbish now and that's why no-one buys it etc etc)

anyway, I look foolish now and your 5 pounds is safe...

@gabrielcasey

I know from all your years of comments and personal attacks on my blogs that you, for some reason, have a complete hatred of me and anything I say – but what do you have against Spain?

By the way, the IFPI comment you pour vile over was a quote by their chief executive, not a quote from me. If you actually read the blog, I said that there's no way of calculating accurately what the losses are.

Helienne: you said there's no way of calculating accurately what the losses are. You say clearly that there are losses due to piracy; you also said that it is a myth to hold that "the loss in recorded revenue is not due to piracy". But if no-one can calculate accurately what those losses are, how do you or anyone know there are any losses at all due to piracy?

Maybe there aren't.

Nothing in this article shows that there are any losses at all due to piracy. No independent study has shown this either - some have shown that piracy actually increases sales. This is a result of people who download stuff then going out and buying more of what they like. That's what music fans do. That's what I do. That's what the (few) people who actually like my own music do (they download it for free and the ones who like it buy copies or show up to gigs or whatever. No piracy here as I explicitly allow sharing / downloading etc, but the principle remains).

Yet you and organisations like the IFPI repeat it over and over again - "our losses are due to piracy" - without any evidence. It is easy to see why a failing industry would like to cling to a simple solution, but it does seem blatantly obvious to just about everyone outside the major labels cartel that their losses are not due to piracy but to a raft of other things - abandoning A&R, the recouping scam being common knowledge, utter lack of quality control, utter lack of balls in terms of backing anything not close to a tried and tested formula ever, massive structural and organisational inefficiencies, failure to listen to their own customer base, failure to embrace the internet and new technologies, failure to release back catalogue material that people want to buy and so on.

Far from being a cause of loss, arguments could and have been made that it is actually piracy that is mitigating that loss to some extent.

I remember several comments on Lily Allen's anti-piracy blog which all said something like 'Lily - I became a fan after downloading your first album off the internet. Then I went and bought all your albums and came to your concerts several times. Now you are telling me I am wrong for downloading. But if I'd never downloaded your album I'd never have become a fan in the first place."

That's because people who download stuff and like it become fans and then go out and buy more. The ones who don't like it were never fans anyway.

Why is that so hard to understand?

WayneMyers wrote: A consistent picture seems to have emerged where industry-led studies seem consistently to find that illegal downloading has a negative effect, while independent studies consistently find either no effect or that it actually has a positive effect. See for example the work of Oberholzer-Gee and Strumpf, Sinnreich and others.

The Oberholzer-Gee and Strumpf paper is not well supported at all (see The Key Instrument in the Oberholzer-Gee/Strumpf File-Sharing Paper is Defective and How Reliable is the Oberholzer-Gee and Strumpf Paper on File-Sharing?).

Indeed, both authors backtracked last year (see Researchers Change Tune, Now Say P2P Has Negative Impact

WayneMyers wrote: [A] consistent picture seems to have emerged where industry-led studies seem consistently to find that illegal downloading has a negative effect, while independent studies consistently find either no effect or that it actually has a positive effect. See for example the work of Oberholzer-Gee and Strumpf, Sinnreich and others.

The Felix Oberholzer-Gee/Strumpf paper is not well supported at all (see The Key Instrument in the Oberholzer-Gee/Strumpf File-Sharing Paper is Defective and How Reliable is the Oberholzer-Gee and Strumpf Paper on File-Sharing?).

Indeed, both authors backtracked last year, finding illegal downloading has a negative effect (see Researchers Change Tune, Now Say P2P Has Negative Impact ).

Thank you for posting that, ThePowerofX.

I was not aware of the new Oberholzer-Gee/Strumpf paper, and am reading it now with interest.

You are right that it does seem to take a different position from their previous paper I have not read the whole thing yet but right there on the first page it summarises their findings: at least 80% of the decline in music sales has nothing to do with file-sharing and moreover that the advent of file-sharing has not undermined the incentives of authors to produce new works.

The IFPI view as repeated by Helienne's article is that the bulk (if not all) of the problem with music sales is piracy. This new paper clearly says that the bulk of the problem is not in fact piracy but other factors.

To describe that as 'backtracking' would appear to be more than a little bit disingenuous.

There's a certain consistency here: Oberholzer-Gee and Strumpf are researching the matter and drawing conclusions from their research. As their research continues and deepens, they amend their conclusions accordingly.

Meanwhile the IFPI is starting from the conclusions it wishes to arrive at - maintaining an unwavering line throughout - and consistently miraculously finding "research" that supports those conclusions.

I know which methodology I find more trustworthy.

Australia has had one of the most bouyant recorded music markets in recent years and avoided the colossal sales drops seen in most other countries.

Australia also miraculously avoided the impact of the global financial crisis.

Australia also has really backward and restrictive internet with "caps" on how much you can download before it starts to cost you more money or your service is slowed to "dial up" speeds (seriously)!

At the beginning of 2010 most Australian internet service providers lifted "caps" on off-peak services, essentially meaning no limits on downloads (something people in the rest of the developed world have taken for granted for most of the past ten years).

Recorded music sales for the first half of 2010 suddenly dropped by around 25%. There were no other pointers as to why this happened apart from the sudden access to limitless internet. Draw your own conclusions.

@Poor Helienne Lindvall

I know from all your years of comments and personal attacks on my blogs that you, for some reason, have a complete hatred of me and anything I say

That is outrageous. I certainly do not hate you and I think my criticisms of your ideas are a lot less personal than your increasing habit of dismissing my arguments on the grounds that I am some sort of troll who thoughtlessly 'attacks' everything you say without any real reasoning or legitimate argument. You are supposed to be the professional here - you are the journalist - therefore you should be prepared to defend your ideas with reason, maturity and eloquence, rather than sniffily dismissing critics of your work 'cause they hate you' (which is childish). If you aren't prepared to do that you shouldn't publish anything with ideas and propositions (and accusations) in the first place. As for the fact that I have consistently returned to your blogs and actually thought about the arguments in them for years as you point out - how is that not the best flattery that a journalist can ask for? How is that not positive?

but what do you have against Spain?

Nothing?

By the way, the IFPI comment you pour vile over was a quote by their chief executive, not a quote from me. If you actually read the blog, I said that there's no way of calculating accurately what the losses are.

What WayneMyers said. He put it quite concisely here:

you [Helienne] said there's no way of calculating accurately what the losses are. You say clearly that there are losses due to piracy; you also said that it is a myth to hold that "the loss in recorded revenue is not due to piracy". But if no-one can calculate accurately what those losses are, how do you or anyone know there are any losses at all due to piracy?

Any reasonable response to that? Or does Wayne hate you as well?