Tag Archive for: music industry

iTune Sales Plummet

The National Post headline read: Sales Cut In Half: Revenue plummets 65% as consumers lose their appetite for Apple iTunes.

And with that news, spread broadly across the mainstream media, Apple stock dropped 3%.

The problem? The story is simply not true.

From the National Post:

Since January, 2006 the number of monthly iTunes transactions has declined 58%, while the average size per purchase declined by 17%, leading to a 65% overall drop in monthly iTunes revenue, U.S. market research group Forrester said in a survey among North American consumers.

National Post took the story from Reuters. Faced with numerous questions on the validity of the research, Forrester made a post on their blog to clarify their report. Here is an excerpt:

What an interesting couple of days it’s been. What follows is a case study in how information — and misinformation — spreads on the Net.

We put out a simple little report about iPods and iTunes based on credit card transactions and publicly stated Apple data. And for those who aren’t Forrester clients, I blogged the highlights. In case you are wondering, we ran the report by Apple, and they declined to comment.

Since then: – The New York Times ran a little fairly balanced pieced on the research. This got us on the media’s radar screen. Then . . . – A UK outfit called The Register and Bloomberg decided to dive in and highlight one finding of the report — that iTunes sales had dropped in the first six months of this year. We got treated to wonderful headlines about iTunes sales “collapsing” and “dropping” and “plummeting” and so on.

Now for the record, iTunes sales are not collapsing. Our credit card transaction data shows a real drop between the January post-holiday peak and the rest of the year, but with the number of transactions we counted it’s simply not possible to draw this conclusion . . . as we pointed out in the report. But that point was just too subtle to get into these articles. – Apple’s stock actually did plummet — 3%.

I started getting calls from hedge fund managers. Apple’s spokesman called and, although they refuse to go on the record with any facts, they’re clearly upset. And I also heard from the Chicago Tribune, San Francisco Chronicle, LA Times, Financial Times, Toronto Globe and Mail, thestreet.com, etc. At this point I was trying to get people off the “65% drop” idea and onto some of the more interesting ideas in the report, with mixed success.

Now, you can’t unring the bell. But I will try to focus you on the truth here, which is this: iTunes sales are leveling off, the Journal did an article about it last Friday with data from Soundscan. Apple is not in trouble — it makes its money mostly from iPods, and iTunes is just a way to make that experience better. It’s the music industry that has to worry, since the $1 billion a year or so from iTunes, globally, doesn’t nearly make up for even the drop in CD sales in the US, which are now down $2.5 billion from where they were.

The researcher from Forrester got another point wrong. This was not a case study on how information and misinformation spreads on the Net. This was a story that leaped over to the mainstream media. And, in the spirit of diligent journalism, the papers simply grabbed a news feed and printed it for effect. No validation. No investigation.

In other words, the mainstream media became a parrot.

Making It As A Songwriter

BMI‘s president, Del Bryant, has this to say about making it as a songwriter:

“There are more people struck by lightning in a year than there are songwriters who take off out of nowhere. It was a tough profession yesteryear, and it’s tough today. A pure writer without contacts is in a world of hurt.”

Average income levels are remarkably low. So low that songwriting cannot be considered a viable choice for supporting a family.

Sources of income for a songwriter include the following:

  • Mechanical Royalties
  • Performance Royalties
  • Synchronization Fees
  • Sheet Music Sales
  • Commercials/Jingles Income
  • Internet Streaming Fees (pending)

Last time I checked the statutory minimum for CD mechanical royalties in the United States was 8.5¢ per unit sold. Generally, the publisher takes half and the songwriter gets half. One person I know gave me his perspective: “in 37 years as a recording artist, I’ve created 25+ albums for major labels, and I’ve never once received a royalty check that didn’t show I owed them money.”

Even if you were fortunate enough to get covered by an artist who could move 50,000 units, your return would be a few thousand dollars.

The music business is exactly that: a business. I have spoken with a couple of artists lately and they were completely oblivious to the economic model for supporting a career in music. They had stars in their eyes.

Once you have a need to pay the bills, such stars fall pretty quickly.

Kurt Browning and BNL

Lorraine and I were invited to a box at the Air Canada Centre to see Kurt Browning‘s Gotta Skate VI. Also on the headline were the Barenaked Ladies, now known as BnL.

I wasn’t too keen on the skating but I was really interested in hearing BnL in concert. The band and the material were both great. The sound was just plain awful. I cannot recall the last time I heard a professional sound system come across so poorly. Very disappointing.

BnL has a great website with a very interesting feature. You can download the multitrack stems for some of their songs and remix them. I guess the proliferation of wannabe recording engineers has reached mass market. Or, more likely, the proliferation of PCs with recording software.

For a couple of dollars, you can download 16-bit/44KHz stems and remix their songs. Upload them and they will get judged. Check it out here.

Neat idea.

I like the band. I need to pick up their latest CD. Without the bother of having to remix it myself.


A Long Wait Rewarded

I received some feedback from the latest project I just finished. I have worked with numerous artists over the years and I pour hundreds of hours as well as heart and soul into each project. Although most artists really appreciate the effort, there have been a few that have hardly said thank you. Star egos, I guess.

This one really touched me. It came from a family member of one of the players. I’ll share just a fragment.

“From the bottom of my heart I want to thank you for doing such a fantastic job. I was totally blown away by the quality and professionalism of the recording. I was walking through the mall the other day with my wife and I broke down in tears just thinking about it… I’ve been waiting 30 years to hear it done right, now I have heard it.”

My Own Room

An unexpected honour has come my way. I provided a donation to the Music Industry Program of the College of Media Arts and Design at Drexel University in Philadelphia.

In recognition of the donation, I will have a studio room named after me.

I will have to make the trip down once the room is finished.

Make Our Dreams Come True

I receive a lot of email requests to help produce an artist. I generally work on a couple of projects a year and, each year, I receive upwards of 100 email requests.

I am very selective on the artist and the project. Most of our work comes through word of mouth and personal connections. As a consequence, the majority of email requests receive a brief negative response. Every once in a while, though, a request comes forward where I have to be careful about the response.

Here is an excerpt from one that I received yesterday:

Hi… i was wondering once me and my band get together and all if you could / wanna work with us on the recording and all? We are 13 yrs old. and wanna make our dreams come true.

I guess the Internet makes it easy for kids to reach out to total strangers. This note came from a young female. And, as a parent, I would be concerned if my daughter took such an action independently.

I will frame a positive and constructive response. I will encourage them to work with their parents on their dreams.

The Space Between the Notes

I was pointed to this link from another blog. The post emphasized the importance of leaving space in the music.

I have tried to teach my son that there are five core elements to being a skilled musician:

  1. Technique: the ability to master the mechanics of playing the instrument
  2. Tone: the ability to produce exceptional sound from the instrument
  3. Touch: the ability to impart a unique voice to the instrument and to create excitement and energy
  4. Tempo: the ability to play in time
  5. Talent: the ability to improve talent over time

The importance of leaving space in the music is arguably an element of improving musical talent. The following picture from the referenced post is an illustration:

Leave some space

However, some of the musicians that I have played with over the past 30 years in a variety of church worship teams might be wise to leave even more space between the notes. A chart like this might come in handy every once in a while:

Leave a lot of space


Well, it looks as though we have finished final mixes for the Mercy Train project. We started tracking the project in March of 2005. And, after hundreds of hours of recording, editing and mixing, we put the final touches on the songs today.

I still have a bit more work to prepare the material for mastering. Rick Hutt will be doing the mastering work for this project. I first worked with Rick about 25 years ago at his studio in Kitchener. A very talented individual. Amongst his many achievements, he won the Canadian Country Music Association’s Producer of the Year award.

What a delight it has been for me to work with Jamie and Skip. I will look forward to working with them again.