Digital Revenues Pass CDs at Atlantic
Record companies initially fought digital music. How does a record company make money in the MP3 business? Now The New York Times reports that Atlantic Records is the first major record company to earn more money from downloaded digital music than CDs.
This Has Happened Before
In the early 1900s sheet music publishers did not look favorably at recorded music. The publishers feared that people would stop buying sheet music and instruments if recorded music was available. John Philip Sousa voiced music industry concerns during a 1906 congressional hearing on “talking machines”:
These talking machines are going to ruin the artistic development of music in this country. When I was a boy…in front of every house in the summer evenings, you would find young people together singing the songs of the day or old songs. Today you hear these infernal machines going night and day. We will not have a vocal cord left.
A century later, MP3s caused a similar disturbance in the record industry. How do you monetize music if it’s in digital form? History repeats.
Solutions Discovered
The industry figured it out. The Apple iTunes service was a big help. Cell phone companies, with their downloadable ring-tones provided another revenue stream.
Next target: The movie industry. The disruption has already begun.
Comments are now closed.