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Reflections on the Music Industry in 2011

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Reflections on the Music Industry in 2011

Over the last couple of weeks details about the music industry results for 2011 have been trickling in, and at this point I figured it was time to share a few interesting (to me, anyway) tidbits … and then discuss them in more detail. Here’s one of the points that I think is really important that also really makes me smile:

I am enjoying watching the industry rush to get behind Adele (or more to the point, jump on her bandwagon), while in reality they were never rooting for her. Her album didn’t have huge marketing, and took off thanks to a curious method you might have heard about: airplay and listener feedback. People liked her song and voice and bought and requested the song, which got it played more and more and more. Completely organic – labels love the money but hate the lack of control.

Here are a bunch of tidbits and statistics and random facts from the year:

There are a few things worth discussing – overall sales, digital transition, streaming music services, vinyl, and the distribution of sales.

Having overall album sales grow is a great thing – 330.6 million albums is an amazing feat, even if it is only up 1.3% overall. The bottom line is this: in spite of piracy, streaming music radio (Pandora/Slacker) and streaming on-demand music (Rdio/MOG/Spotify), MORE albums were sold than last year.

People hoping for monster double-digit gains for digital sales got a mixed bag – albums up 20% is very good, but overall digital rose under 10%. Again, impressive … but it shows a maturing of the medium.

Vinyl continues to be a really cool story, just not one making a huge amount of money – numbers like ‘up 37%’ sound impressive – until you realize that the TOTAL vinyl is about half of Adele’s sales of 21 for the year. And having the #1 vinyl album be the 41 year old ‘Abbey Road’? That really tells you what to expect – it is a neat trend but not a long term large market.

Indie labels accounted for 12% of sales. Is that good? Is that bad? What is an indie? I really don’t know … but it is more than EMI managed before THEY got swallowed up. If the goal of an indie is to allow for greater creative control and also it a decent market, I would call 2011 a great year for indies.

As for the genre breakdown, I’m not even worried about that … things come and go and get carried by a single album that happens to hit that genre – like Norah Jones being classified as ‘jazz’.

As I said, I am enjoying watching the industry fall over themselves about Adele. On the other hand, I had hoped for lower numbers for Lady Gaga’s craptastic ‘Born This Way’. Sure I laugh to realize that 25% of those sales were essentially freebies ($0.99 full album), and also that the second the freebie promo ended sales plummeted by 85% and never returned … but somehow she managed low-level sales all year and the label bought their way onto ‘top ten lists’ in spite of being a really dreadful piece of garbage.

Streaming music is the big story of 2011, though. We saw Spotify launch in the US and get close to 3 million PAID users worldwide by the end of the year. I have no idea how Rdio and MOG are doing, but based on how often I see their names on Facebook from friend’s lists, I assume they are doing well – but not ‘Spotify well’. The Facebook integration as well as enhanced ‘free modes’ from MOG and Rdio have all helped make music more social than ever – everyone wants a piece of it.

But at the same time there has been some backlash. Coldplay had a ‘100 day window’ where they didn’t offer anything on Spotify or other streaming sites. Multiple indie labels pulled all of their content as well. The thrust of their reasoning: Spotify and other streaming sites steal sales. Is it true? We really don’t know. I have said that I love streaming for that moment you want to hear ‘I Had the Time of My Life’ and hear it once and not think about it again for three years. Labels want you to spend $1 for that privilege (actually they want you to pay $12.99 for the album, but that is already a lost argument), but streaming gets you the music for a small charge – and keeps your mind away from piracy.

The interesting thing to me is that at the same time as going through this I am finishing my ‘Best Music of 2011’ article, and I have noted two things. First, there was a TON of amazing music released last year. But more than that … NOTHING on my list would be part of the ‘2% that sold 90%’ list. And there was plenty of great music in the top sellers as well.

So I would say that 2011 was a great year in music – great commercially, great creatively, and great in the social expansion of streaming music.

What do YOU think?

Sources: DNM, HypeBot, others.

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