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Album Sales, 2009/2010

totals to date on select 2009 titles… let me know if there’s others you’re curious about

Clipse “Til The Casket Drops” – 59,406

Snoop Dogg “Malice N Wonderland” – 157,434

Kid Cudi “Man On The Moon” – 267,801

Drake “So Far Gone” – 336,890

Raekwon “Only Built 4 Cuban Linx 2″ – 154,102

Eminem “Relapse: Refill” - 1,760,000

Young Money “We Are Young Money” – 212,000

Mos Def “The Ecstatic” – 120,934

Gucci Mane “State Vs. Radric Davis” – 203,000

Slaughterhouse “Slaughterhouse” – 148,000

Rick Ross “Deeper Than Rap” – 406,905

50 Cent “BISD” – 358,000

Jadakiss “The Last Kiss” - 347,033

Wale “Attention Deficit” – 66,000

Jay-Z “BP3″ – 1,533,000

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Industry News:

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What We Already know about album sales in the US
This is a good piece summing up what went down in 2009, and what went up.  What we already know? CD sales are declining (12.5% in ’09).  Digital sales are growing (now accounting for 40% of all sales).  But not fast enough to make up for the revenue gap.  Not a big Deal you say?  If digital is growing (even though its growth is slowing) and physical is shrinking, then the profit margin shrinks, and everyone has to learn to get along without as much Cristal, and with a little more André.  No big deal, right?…

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WRONG!  Check out this fantastic rant from DJ Shadow (props to twitter king @questlove for the link)
(full disclosure, I’ve always been a big DJ Shadow fan) You should really read all of this.  He talks about how the decline in revenue, and the decline in the “business” of music is a slippery slope towards this new era of commercialized radio rap, in which true artistry and innovation is too risky to subsidize.  I gotta say, maybe it’s because I’m a DJ Shadow fan, and maybe it’s because I’m a music business guy, but to hear an artist talk about how important the business, the characters, the label guys and everyone in between, are to the art is refreshing.  Most artists are stuck thinking about how labels are constantly trying to grime them over (see Combat Jack’s “The White Man’s Ice” if you don’t believe me).

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AOL to begin laying off 1200 workers
Just in case you thought that this crunch didn’t extend outside the music biz, the once king of internet access is struggling.  Nothing is certain in these times.

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The Future of the (streaming) music business a.k.a. my long rant
It’s the beginning of the new year (and a new decade), so I like to reflect and wax poetic a little bit, about the status of the business.

Ten years ago, broadband was just starting to get big, Napster was in its infancy, and iTunes didn’t exist yet.  Now, broadband is invading everything from television to cellphones, Tower Records doesn’t exist anymore, and 40% of music sales in the U.S. are digital.  Ten years ago there was no YouTube, Google was just launching it’s search engine and social networking relied more heavily on beepers and pagers than profile pages and “pokes.” Things done changed.

For the last year, streaming has been at the top of everyone’s watchlist, as the new model to emerge in the crumbling era of the CD.  We’re in a post digital download space.  There have been so many hot companies it’s almost mind-blowing: Imeem, iLike, Pandora, Rhapsody, LaLa, Spotify, Grooveshark, just to name a few.  But what’s happening?  imeem and iLike have been bought out at firesale prices by MySpace (the original web 2.0 music hub).  These companies had loads of traffic, but no successful monetization model for how to convert their streams into a) profitability for themselves or b) an ability to support artists and labels who rely on the paid distribution of music as lifeblood. Pandora is finally claiming profitability, which is promising.  Google has launched their own music streaming search function, and LaLa has been bought by Apple, as they attempt to extend their dominance of the download-based model into streaming.  I’m not quite sure what this is going to look like, but you can bet this is what they’re thinking of, and not just for music (streaming movie/tv show rentals, hint hint).  Here’s a quick look at what I think is in store for the mass consumption of media/entertainment (music, movies and books) in the not too distant future.  That’s right folks, it’s the cloud model.  That’s what seems to be the dominant thinking right now.  You have a “rights locker” in some imaginary storage space online, that allows you access to the cultural items (books, music, movies, games, etc.) that you’ve paid to have access to.  This access will/should be available from any home entertainment unit (tv, computer, xbox, etc) and from any mobile device (iPhone, blackberry, Kindle, netbook).  I like this model.  As a consumer of culture, this makes sense to me.

So what DOES the business of this future look like?  I hate to reference this reactionary thinker, and after reading this entire article, I don’t really agree with him, but the questions he raises in the first half are some of the same questions that DJ Shadow raises, which are the same questions that we think about every day in the music business.  How do you create a successful business model when everyone expects their content for free?  Some will say eFF a business model, eFF the industry, I’ll take my content for free, but I place some value in the culture industry.  Maybe not in eating up what the mainstream serves, but I believe that people who create a cultural product that others actually enjoy consuming deserve to make a living wage off of it.

So how does/can this happen?

1) Mobile Ad Support.  Pandora is successful because they’re monetizing mobile ad dollars.  This is going to be a large, and extremely fast-growing market (see google’s $750 million purchase of AdMob).  Advertising follows impressions, and with more and more (young) people accessing data from their mobile devices, this is where the eyes are.

2) Paying for data, not content.  Despite my reluctance to go out and buy a CD for $10, a DVD for $15, a book for $20 and a newspaper subscription for $30, I know that I’m going to be down to spend $100 / month to keep my internet and tv working, and an additional $75 to keep my cell phone and data plan on.  Am I right in thinking this isn’t just me?  Seems like TVs and computers are about to be the same thing.  In the not-too distant future, people are going to be getting their information and paying for it all in one place.  So… if there can be some ISP/cell phone provider added content bill that allows consumers to continue their habits of paying for access to data, not content, then this could make sense.

But what do I know?  Till next time,

Peace.