We live in an interesting time in the history of music distribution. As the record industry and the artists that benefit from it lose the fight against illegal downloads, musicians are looking toward new business models to make money. For example, Spotify, a subscription music service, recently teamed up with Facebook to put a social networking spin on music consumption (to read more about this: check out this article in Wired). The premise is that you see what your friends are listening to – live on Facebook! – and you sign up for Spotify in order to check out the new bands. After a certain number of hours of free listening, you begin to get charged a small fee every month for ad-free listening of a huge selection of music anytime.
But is it really anytime? Since Spotify (and others) are streaming services, you don’t own the music that you listen to, and you have to be hooked up to the Internet to take advantage. This doesn’t seem like a big deal, especially since 3G is on almost every phone, and WiFi access is almost ubiquitous. But people still don’t like this idea because they don’t get to own the music. The endowment effect – the idea that something that you own has more value than the same exact item out of your possession – is a powerful phenomenon, which has been described in behavioral economics. You see, owning a song makes you like the song even more, because you procured it, and you made the choice to procure it. People like getting mix tapes and mix CDs from friends much more than they like just getting playlist recommendations. Having possession of a song, even if it’s just an mp3 file, is a meaningful thing.
So how are we going to own our music in the future? A recent article reports (though I’m not sure how trustworthy this claim is) that the CD format is going to be abandoned by major music labels by the end of 2012. From a business standpoint, this is a sensible decision. It costs some money to make CDs and to store them, and most people are buying music on ITunes or Amazon nowadays anyway. So is all-digital the future? Certainly seems like it. Digital music sales keep increasing.
But sales of old-school vinyl records are also increasing! Wow, I told you this was an interesting time in music distribution history. What’s going on here? Well, people like having a physical memento of the music that they like, and vinyl is what some people call “the format through which music was meant to be listened to”. (As a digression, this is probably only true for songs that were recorded a long time ago. MP3s do result in a loss of information, but CDs might actually be better than vinyl in terms of music quality for more recently recorded music. But I’m no expert). I think that part of the appeal of records, as opposed to CDs, is that they’re now rare and, therefore, cool. I bet that once CDs are gone, there will be a resurgence of CD sales in 10 years or so.
*Sigh* I guess at the end of the day, it’s the music that really matters. As formats change, the timbral quality of music might shift, but the appeal will always be there.
Oh, and please try to buy music. Especially if you like an artist or an album already, just go ahead and cough up the cash – whether it’s vinyl, CD, or just something that exists in the cloud.