Peter Kafka

Recent Posts by Peter Kafka

No One Buys Music on the Web Anymore. Except When They Buy a Million Beyonce Albums in Five Days.

Sales of music downloads, which were supposed to rescue the music business from the decline of the CD, have been flattening for a few years. Then things got worse: This year, digital sales were down 4 percent through Thanksgiving.

Lots of people assume that download sales are slumping because more people are listening to streaming services like Pandora and Spotify, but it’s hard to prove that thesis out. As Billboard notes, there are a lot of reasons for sales to slump.

And then it turns out that people will still buy digital downloads, in record numbers. Sometimes.

Last week, as you may have heard, Beyonce surprised the pop culture universe by releasing a new album without warning or fanfare, exclusively on iTunes. Three days later, Apple had sold a record 828,773 copies of the eponymous album, which came paired with a set of digital videos but wasn’t available as individual tracks. And today Apple says the number has climbed above a million.

During the peak of the CD era, it was routine for acts like NSync to move more than a million albums in a week, but those days are long gone. A couple of years ago, when Lady Gaga was arguably at her peak, she was able to sell 1.15 million, but that involved a multi-outlet publicity campaign — and 400,000 of those sales were at a buck a pop, via Amazon.

So What Does It All Mean For The Future Of Music Sales?

Not a lot, I think. It means that if you are a really, really, really big star, and you do something really unconventional, people will pay attention. The first time. But as Bob Lefsetz says, you can’t repeat that stunt again.

I think you’re going to see most stars — even really big stars — continue to flood the zone when they have product to move, and in some cases, it will work.

And I think that streaming services will continue to grow, though it’s not clear at all if paid streaming services like Spotify will become truly mainstream. Regardless, the case for buying an album of songs from a single artist gets harder and harder to make.

But even in that instance, there’s an exception, which I learned years ago from Eric Garland, the wise fellow who founded music analytics startup Big Champagne and sold the company to Live Nation, where he still works.

The boiled-down version goes like this: It’s really hard to get anyone interested in any album, even if you give it away. But any album that has at least two popular songs on it will sell a lot of copies. This explains Adele, among a very few others, and if you can adhere to it you’ll do great. If not, you’re going to have to figure something else out.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik