DA NUMBAS from Nielsen Soundscan Music Sales 2008

Here ya go....

• Total album sales fell to 428.4 million units, a drop of 8.5% (2007 = 500.5 million).

• Physical album sales fell 20% to 362.6 million (from 450.5 million)

• Digital album sales rose 32% percent to 65.8 million units;

• Digital track sales were up 27%, breaking the 1 billion mark for the first time at 1.07 billion.

• Total transactions rose 10.5% to 1.5 billion;

• All Genres saw losses: Classical music dropped 26%; Country fell 24%; Latin was off 21.1%;

• Vinyl album sales also grew with 1.88 million vinyl albums purchased for the year. Up 89% over 2007

Concerts saw higher revenue, due primarily to higher ticket prices. For the 100 top-grossing shows:

• Box-office receipts from North American concerts were $4.2 billion, up 7.8%;

• Average ticket prices cost $66.90, up 8%;

• Number of tickets sold fell 3%, to 35.6 million

Top 10 highest-grossing tour of 2008 in North America:

Madonna - $105 million
Celine Dion - $94 million
Eagles - $73.4 million
Kenny Chesney - $72.2 million
Bon Jovi - $70.4 million
Bruce Springsteen & The E Street Band - $69.3 million
Neil Diamond - $59.8 million
Rascal Flatts - $55.8 million
The Police - $48 million
Tina Turner - $47.7 million

There are a number of articles written, both positively and negatively on the results of 2008 sales based on how the writer wants to slant the article. I'd like to point out that these initial numbers for sales are gathered by Nielsen Soundscan whose numbers don't accurately reflect sales for indie music or products sold through non traditional means.

"Music sales are following the trend established over the last several years: Digital Sales Up, Physical unit sales down, and overall revenue sliding further." While that is true, CD sales still account for more than 400 million units in sales. If digital downloads were attributed 10 songs per disc, the equivalent in sales turns the 1 billion downloads to 100,000 equivalent albums. Being I was an early pioneer for digital distribution, this doesn't surprise me. What surprises me is how bad the quality is when it doesn't have to be.. but that's another article....

I don't think any indie artist will give up making cds just yet. It's still a valuable revenue stream for selling at gigs, getting reviews, offering information and creating a brand image.

Added to the arsenal of artist revenue streams is good ol' vinyl. Note that vinyl is up 89% in unit sales over 2007 and increasing. Vinyl sales won't overtake cd or downloads in sales, but, is becoming a more viable revenue stream and crossing all genres of musical tastes, economic standing and age.

Vinyl is not just for audiophiles. We're seeing increasing vinyl production from punk to pop. Whether the source is from tape or from disc, vinyl represents a true music lovers desire to collect memorabilia from favorite artists with full graphics and lots of information. From the artist perspective, sales are 'one way'.. unlike trad distribution of the revolving door. No returns. Hallelujah!

I'm not suggesting you toss your mp3 player out the window just yet. Mp3 and lower rez downloads are great for wall paper listening, hearing new music and artist promotion. Internet music has replaced radio for wall paper. You pay for not having the ads...

Economic conditions aside, the world of music is flooded with talented and untalented folks, all putting out their own independent music, recorded unserimoniously in someone's garage under questionable conditions. Music has been on a downhill trend 7 of the last 8 years. The music, the sound, the magic is gone and the public is tired of spending money on the risk of more clutter. Can you blame them? The public is confused as to where to look, how to find new music and doesn't want to spend time looking. Confusion never makes a sale.

A couple of notes from 2008 that changed the business. Walmart became the new major label, with Best Buy and Target soon to follow. Last May, Walmart instigated a $9.95 top price for a cd. You could buy the whole mp3 album for $11. Such a deal! Then, in the first week of sales, Walmart would selling to the others (like Best Buy) who would mark it up. That means soundscanning happens twice on many recordings inflating the sales numbers. If your thinking Walmart is going to put the final knife in the cd, you're probably right. Fortunately, they don't carry many titles.

So... what to do if you are an artist? Gigs. I'm a little disappointed to see that the top grossing acts are mostly over fifty with careers of 20 years or more, under the contractural hands of livenation.com ( the OTHER record label) that cater to the baby boomer generation. Good to note... most of my festival promoter friends had very successful events in 2008 despite the economy covering all genres of music.

On a personal level, Blue Coast doubled its revenue in 2008 with no traditional retail or mp3 available for sale. Our SACD discs sell for $30-40 online and through audiophile online stores worldwide. China is 40% of our business, France is 50% of our direct from website sales. We have no tour, did no radio or solicit reviews. How did we do it? We found our niche and went to their trade shows where we had a captive audience of 3000-10,000 people. We brought a great product and weren't afraid to promote it. If you're an artist, I recommend you do the same.

It's not brain surgery. Fans want to meet and talk to the artists or producers behind the music. They want a story. All you have to do is give it to them.