The Music Industry: Aiming for the Singularity But Hitting Collapse Instead [part 1/6]

youtube-Logo-4 gc2 reddit-logoOff the keyboard of Allan Stromfeldt Christensen

Follow us on Twitter @doomstead666
Like us on Facebook

Published on From Filmers to Farmers on March 4, 2017

Discuss this article at the Kitchen Sink inside the Diner

 


The appearance of the music industry's various formats, plotted along
M. King Hubbert's 1956 projection of worldwide oil extraction rates

Although the world economy hasn't been booming lately this hasn't meant that the booming has been reduced to economizing, what with the boom booms having gone through such a transformation in the past decade that "streaming" – playing music on a digital device without actually storing it – has pulled the music industry out of the piracy-induced doldrums that saw its sales plunge by more than 70% since its peak in 1999. As put by Cary Sherman, chairman and CEO of the RIAA, "I'm confident that music's future is bright. The popularity of music is greater than ever. Like never before, it drives our culture and commerce." However, while the music industry is busy championing its new-found success thanks to digital nirvana, it's not exactly surprising that what it doesn't notice is that the next decade is likely to see not its resurgence but rather its collapse. I'll back up a few decades to explain.

Like any (former) suburban-boy born in the late-70s in an affluent-enough family in an affluent-enough region of southern Ontario (which for years was North America's fastest growing area), a paper route and then a decent-enough part-time job were enough to get me the disposable income needed to adorn myself with a rather decent CD collection, probably 120 or so of the things by the time I got to university.

A much-more-than-decent summer job given to me on a silver platter was then enough to get me a shiny new Apple computer for video editing, the soon-to-be-released iTunes program eventually used to transfer all my CDs to MP3s. This all happened during the time that the pirating of music was starting to do a number on the music industry, beginning with "services" such as Napster, Gnutella and Kazaa. Being a "poor" university student I of course tried them all out a few times, but it was obvious that Napster-and-company's rinky-dinky method of having to search for and then download individual song by individual song wasn't going to cut it for me. I liked listening to entire albums, not the latest top-ten, which meant I ended up using Hotline.

Never heard of Hotline? I didn't think so.

For the life of me I can't recall how I first heard of Hotline, a TCP/IP file transferring system which consisted of three programs: Hotline Server, Hotline Client, and Hotline Tracker. The Server portion was operated by somebody who had a computer with a high-speed Internet connection that could ideally be left on 24/7, to go along with a large enough hard drive for storing a significant amount of files – MP3s were what interested me, but you can imagine the kinds of things some people would store and share (I never checked).

The Client portion of Hotline was then used by somebody who wanted to connect to Servers in order to download files. You first had to locate Servers (which is what Hotline Tracker was for), and then follow the rules they individually laid down. The handful of Servers that I frequented had several hundred albums each, their rules generally along the lines of "upload one decent and relevant album for every five you download", although some requested (not demanded) donations of a few bucks to cover bandwidth costs.


Hotline Client (image courtesy of Macintosh Repository)

While I still continued to purchase the occasional CD here and there, those purchases paled in comparison to the amount of shot-in-the-dark albums I downloaded via Hotline. This was of course rampant theft, and is indicative of why the music industry began to tank at the dawn of the 21st century.

I wasn't – and am not – a big fan of theft, but being a "poor" university student I was gifted with the required mental gymnastics to justify to myself this particular grifting by thinking that when the time came I'd in return provide to others material I'd created au gratis. (As a bit of a consolation these posts on this blog are licensed under Creative Commons [see the logo/link at the bottom of this page], which means that anybody can re-post or re-work my material, for free, so long as they give attribution to me and/or FF2F as the original source. Of course none of this excuses my previous theft of material that certainly wasn't licensed under Creative Commons, but hey.)

With about 600 albums in total (roughly 25% of which were legally purchased, the rest coming from Hotline or ripped to MP3s from friends' CDs) all of my music was now played directly off the computer, and being the time before DVD-Rs I made sure to have it all backed up onto CD-Rs (about five albums fit per CD-R). In the process I somehow managed to give myself the impression that actual albums were materialistic, and having the only really important part on my hard drive and backed up to CD-Rs I slowly proceeded to get rid of all of my purchased albums.

But like the saying goes, the road to hell is paved with good intentions. Fully immersed amongst digital doo-dahs and steadily making my way towards ever more efficient usage of zeroes and ones, you might say I was unwittingly making my way towards some kind of singularity, a state where my mind could be uploaded to the Great Cloud and I could simultaneously listen to all 600 of my albums – heck, where I could simultaneously listen to all albums in existence – and live out eternity in a state of vegetative ecstasy.

Or something like that.

Anyway, being a bit too pragmatic when it came to the techno stuff I was of course mesmerized when the first iPod appeared on the market, but since I wasn't about to shell out $600 for one of the things – and for some reason was okay with stealing music but wasn't okay with trying to steal an MP3 player – I never did get one and just stuck with my Discman and CDs. Deep down inside I was kind of happy with the restriction of no iPod, somewhat aware that the musical orgy I'd immersed myself in was getting seriously excessive, even for a "music lover" like myself.

The nag of excessiveness stuck with me (as did the uncomfortable fact that about three-quarters of my music was stolen) to the point that upon having ditched university/film school a few years later – and trashed any evidence that I'd ever made a film or video in my life – I followed that all up with another "unthinkable". Having subsequently quit the Internet (which lasted five years), I then took my black CD binder of 120 or so CD-Rs with 600 or so albums on them, walked over to the thrift shop, and dropped it all in the donation bin.

The singularity could go to hell. (Or was it hell that could go to the singularity? I don't know, one of the two.)

For about ten years I owned absolutely no music and, although I certainly overheard music in various places, not once did I ever play an album on a friend's stereo or even throw on a radio. This resulted in several "blessings in disguise", one of them related to the fact that I was a former (budding) filmmaker with a hyperactive visual sense who while unavoidably perceiving the world through a lens couldn't help but also see/envisage images whenever hearing music. But having gone through my decade-long hiatus I'm happy to have noticed that my "affliction" has been inadvertently fully cured.

Having returned from my ten-plus years in the "musical wilderness" it's no secret that things have significantly changed during my absence. When I left the music industry was in free-fall, and as I return it's finally managed to stop the bleeding that lasted for – what do you know? – just over ten years. Has the quality of music suddenly gotten that much better?

Yeah, not quite.

When I left the biggest change going on was the transformation from CD sales to (meagre) download sales and (overwhelming) illegal downloads, Apple's iTunes store leading the pack when it came to the former but which was getting swamped by the latter. But with the proliferation of smartphones and other gizmos with high-speed Wi-Fi and/or cellular connections, streaming music has subsequently not only taken the industry by storm but even revitalized it. So much so that sales of digital downloads are cratering, going from a high of $3.9 billion in 2012 to a projected $600 million by 2019, many insiders even expecting the digital download to disappear within the next few years. On top of this, while 2016 saw vinyls have their strongest year of sales in a quarter century, 2016 was also the first year that spending on vinyls outstripped sales of downloads (!?). Is the singularity being defeated by Shangri-La?


This guy apparently likes vinyl for some reason (photo courtesy of Asphalt Tango Records)

Well, as one record label CEO put it,

People think millennials just stream and are just digital but actually I think we are going to see increasingly over this coming year that young people still want something tangible and real and that's where vinyl is taking on the role that the CD used to have.

That's all sideshow of course, because the writing on one of the walls is that "streaming music is the wave of the future". But check out the generally-ignored adjoining wall – this wall sponsored by the Limits to Growth – and you get the rest of the sentence: "for now."

For now the music industry is certainly doing great, 2016 also being the first year that digital revenues overtook revenues from physical sales. With 90 million people worldwide now signed up to streaming services – roughly 40 million with Spotify, 20 million with Apple, and the rest split up between Tidal, Pandora, Amazon Music, Google Plus and others – it's been stated by the former head of Universal Music's digital division that "music has never been more popular". With streaming services generally costing about $10 per month the price is so affordable and the service so convenient that for many people it's made illegal downloads not worth the time and effort. Indeed, streaming has become so prominent that Spotify's chairman/CEO and co-founder, Daniel Ek, was recently named by trade magazine Billboard as the most powerful person in the industry. Likewise, although they're not expected to reach their 1999 high of $40 billion in sales, an analysis by Macquarie Research expects sales to double from the current $15 billion to $30 billion over the next 10 years.


The hype is tripe – although to be fair tripe does go rather well in pho

Not everything's perfect in the streaming industry though – and I'm not talking about the fact that although Spotify is valued at about $8 billion it hasn't ever actually made a profit, that it "made a loss of $200m" in 2015 (I'm guessing studies have shown that "made a loss of" has a less drastic effect on markets than "lost"), nor that it may never make a profit in what may very well be the ten years it's got left. But before I get to explaining the reasons for the latter, there's also the uncomfortable fact (uncomfortable for the music industry) that while Spotify and Apple lead the pack in sales of streaming services, YouTube dominates all others combined when it comes to actual streaming – which is not only a thorn in the music industry's side because YouTube's services make "stream ripping" possible, but mostly because YouTube pays out much less than its competitors (its payments come out of its ad revenues rather than on a per-song basis).

As the RIAA's Cary Sherman also put it in 2016,

Last year [2015], 17 million vinyl albums, a legacy format enjoying a bit of a resurgence, generated more revenues than billions and billions of on-demand free streams [such as YouTube]: $416 million compared to $385 million for on-demand free streams.


I know the RIAA doesn't like people ripping off music, although I'm
not sure what their take is on people ripping images off their blog

But regardless of which convenience you want to go with, a caveat inherent to putting yourself at the mercy of a streaming service is that unless you only want to listen to music when you're in Wi-Fi range then you'll also need to put yourself at the mercy of a cellular plan. This can be a problem for those like me (which, granted, there aren't very many of) who while not having a phone plan for their gifted (and "obsolete") smart phone only have a "measly" $10, 1 GB per month data plan, a cap that can be eaten through relatively quickly by streaming music. That being so, some streaming services allow users to download a few tracks for offline listening.

However, if you read the fine print you'll see it stated that if you stop paying the monthly fees your downloads disappear. Even worse, if you read the even finer print you'll see it stated that if the streaming company goes bankrupt, or the centralized power grid in your area gives out once and for all, or the whole kit and caboodle backing industrial civilization in your neck of the woods finally goes bust, well, it's back to live music for you – if you're so fortunate to have not lost your access to food as your access to streaming music disappeared.

Because the fact of the matter is that with the protracted collapse of industrial civilization now upon us, more and more people are inevitably going to find themselves getting triaged from the industrial economy (under the nom de plume of "austerity" – as I've explained via Greece's situation here and here). In other words, Spotify and company are going to find their subscriber base getting pulled out from underneath them due to the economic effects of plummeting EROEI levels, most likely sometime within the next decade – the very same period when music sales are expected to (ahem) double. (Spotify will then likely get picked up by Google-cum-Alphabet or some other large congolmerate.)

Anyway, while I of course don't want to lose my access to food, if I can I also wouldn't mind holding onto the ability to listen to some recorded music for a few years or even decades (without being a totally spoilt first-worlder) as we progressively go over the far side of Hubbert's Curve. That effectively means I should perhaps impose some musical limits on myself by refraining from bowing down to a streaming service from the get go, and before the Limits to Growth – and by extension the limits to music – really start to kick in in my neck of the woods. How to position oneself for that part of the coming curve is what I'll get to in part 2.


This guy really likes vinyl (photo courtesy of adrianraso.net)

Leave a Reply

Your email address will not be published. Required fields are marked *

Support the Diner
Search the Diner
Surveys & Podcasts

NEW SURVEY

Renewable Energy

VISIT AND FOLLOW US ON DINER SOUNDCLOUD

" As a daily reader of all of the doomsday blogs, e.g. the Diner, Nature Bats Last, Zerohedge, Scribbler, etc… I must say that I most look forward to your “off the microphone” rants. Your analysis, insights, and conclusions are always logical, well supported, and clearly articulated – a trifecta not frequently achieved."- Joe D
Archives
Global Diners

View Full Diner Stats

Global Population Stats

Enter a Country Name for full Population & Demographic Statistics

Lake Mead Watch

http://si.wsj.net/public/resources/images/NA-BX686_LakeMe_G_20130816175615.jpg

loading

Inside the Diner

4 Tactics Used by Monsanto to Undermine Potential Link Between Glyphosate and Cancer By Genna ReedGenna Reed   [img width=25 height=30]http://www.createaforum....

Quote from: Palloy2 on Today at 03:18:32 PM When ISIS is finally destroyed and peace is declared, Syria will be left a broken and divided state, and Russia-China-Iran will have to pick up the pieces.Somehow, I ...

The folks Joe Bageant used to write about.REhttp://www.greanvillepost.com/2017/03/30/reviews-white-trash-both-a-book-and-trump-revolution/[size...

Kerry said this before, and now Tillerson confirms it on behalf of the Trump administration.  Presumably that's what Turkey's announcement means as well.  Saudi Arabia probably won't say anything publicly.  When ISIS is finally destroyed and peace is d...

Diner Twitter feed
Knarf’s Knewz

Quote from: knarf on Today at 09:14:55 AMYep, I go [...]

Quote from: knarf on March 29, 2017, 05:47:04 AMI [...]

Yep, I got hooked on Alex Jones about 6 years ago. [...]

Yes, Soros has invested in many political organiza [...]

Diner Newz Feeds
  • Surly
  • Agelbert
  • Knarf
  • Golden Oxen
  • Frostbite Falls

Helena Norberg-Hodge: Trump Traumahttps://voxpopul [...]

Quote from: Eddie on March 29, 2017, 06:18:24 AMSo [...]

Sounds like work for the admin. [...]

COLLAPSE.GLOBALOK Diners, the Newz Page has been r [...]

Oh the wicked web we weave..... [...]

Quote from: knarf on Today at 09:14:55 AMYep, I go [...]

Quote from: knarf on March 29, 2017, 05:47:04 AMI [...]

Yep, I got hooked on Alex Jones about 6 years ago. [...]

Yes, Soros has invested in many political organiza [...]

Zero HedgeShandong Gold Group, China’s second bigg [...]

2017-03-26 - Brazil handing over the Amazon rainfo [...]

Second State In Less Than A Month Challenges Fed, [...]

Health Freedom Victory: How a Small Supplement Com [...]

I just want enough Smack to go out the EZ and rela [...]

Quote from: azozeo on March 27, 2017, 11:24:54 AMQ [...]

Quote from: azozeo on March 27, 2017, 07:49:50 PMI [...]

I love the mine car scene, thanks... [...]

Alternate Perspectives
  • Two Ice Floes
  • Jumping Jack Flash
  • From Filmers to Farmers

It Hurts When I Do This By Cognitive Dissonance   “Well, then don’t do that” is the proper response [...]

Standard Issue Incompetence - More Evidence of Imperial Decay (Time for Fight or Flight?) By Cogniti [...]

By Cognitive Dissonance   de·lu·sion·al dəˈlo͞oZH(ə)nəl/ adjective: delusional Characterized by or h [...]

By Cognitive Dissonance Back in the days of sword and sail, warships mounted heavy cannon on their d [...]

This issue of my Patreon Newsletter is open to the public. Please enjoy the article. (I now have a P [...]

Event Update For 2017-03-28http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2017-03-27http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2017-03-26http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2017-03-25http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

Event Update For 2017-03-24http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.html Th [...]

The sounds of the Romanian countryside, unleashed by Fanfare Ciocărlia for twenty years and counting [...]

Fanfare Ciocărlia's lead vocalists (and trumpet players) Radulescu Lazar and Costică "Cima [...]

When I finally made the first steps to end my abstention after more than ten years in the "musi [...]

All digital reproductions are equally made with zeroes and ones, although some zeroes and ones are m [...]

The appearance of the music industry's various formats, plotted along M. King Hubbert's 19 [...]

Daily Doom Photo

man-watching-tv

Sustainability
  • Peak Surfer
  • SUN
  • Transition Voice

Rescuing Los Angeles"How can we use our hard wiring to communicate to the herd that it is time to veer off from a r [...]

Wetiko"When we visited Los Angeles, what we were seeing was not so much a collective neurosis as a co [...]

The Sheer Wall"A system that places monetary value on products and services but places little value on their [...]

Climate Ecoforestry"Want to leap the social barrier to cool living? Behold: a stargate."  In 2008 we asked Fr [...]

Cicero and the Summer of 45"Happiness, Cicero said, is not dependent on things that pleasure the body, but on pleasures of [...]

Off the keyboard of Bob Montgomery Follow us on Twitter @doomstead666 Friend us on Facebook Publishe [...]

Visit SUN on Facebook Here [...]

Click here to visit Sustaining Universal Needs’ YouTube Channel! [...]

There is no excerpt because this is a protected post. [...]

In the echo-sphere of political punditry consensus forms rapidly, gels, and then, in short order…cal [...]

Discussions with figures from Noam Chomsky and Peter Senge to Thich Nhat Hanh and the Dalai Lama off [...]

Lefty Greenies have some laudable ideas. Why is it then that they don't bother to really build [...]

Democracy and politics would be messy business even if all participants were saints. But America doe [...]

A new book argues that, in order to survive climate change and peak oil, the global money economy ne [...]

Top Commentariats
  • Our Finite World
  • Economic Undertow

But if any kind of energy use is an (entropy-related) over-all loss of energy, is there anything oth [...]

Thanks, Gail! I had never thought of that Lord's Prayer phrase in that way. It had always just [...]

Athletes are really into yoga wear. My son is an elite hockey player and he and all his teammates we [...]

"couple of years (or more) of failing crops." I don't know if there would be anything [...]

We all are standing that way. That's why I sometimes wear a dress for gardening. [...]

"My feet are standing in both worlds!" Me too!!! I think I just ripped the crotch of my pa [...]

Eyeores, my list is not for suvival. When BAU is over, JIT is over and we are f.....es. It is for my [...]

Thanks for the great post Eeyore. The system is obviously going to take this cycle of exploitive mad [...]

Elmar - Sure it all sounds good butttttttt!!!! I produce about maybe a quarter of what our three per [...]

RE Economics

Going Cashless

Off the keyboard of RE Follow us on Twitter @doomstead666...

Simplifying the Final Countdown

Off the keyboard of RE Follow us on Twitter @doomstead666...

Bond Market Collapse and the Banning of Cash

Off the microphone of RE Follow us on Twitter @doomstead666...

Do Central Bankers Recognize there is NO GROWTH?

Discuss this article @ the ECONOMICS TABLE inside the...

Singularity of the Dollar

Off the Keyboard of RE Follow us on Twitter @doomstead666...

Kurrency Kollapse: To Print or Not To Print?

Off the microphone of RE Follow us on Twitter @doomstead666...

SWISSIE CAPITULATION!

Off the microphone of RE Follow us on Twitter @doomstead666...

Of Heat Sinks & Debt Sinks: A Thermodynamic View of Money

Off the keyboard of RE Follow us on Twitter @doomstead666...

Merry Doomy Christmas

Off the keyboard of RE Follow us on Twitter @doomstead666...

Peak Customers: The Final Liquidation Sale

Off the keyboard of RE Follow us on Twitter @doomstead666...

Collapse Fiction
Useful Links
Technical Journals

This paper examines the effects of climatic and non-climatic factors on cassava yields in Togo using [...]

Climate is one of the single most important factors affecting watershed ecosystems and water resourc [...]

Municipalities are important actors in the field of local climate change adaptation. Stakeholders ne [...]

The Global Climate Model (GCM) run at a coarse spatial resolution cannot be directly used for climat [...]

Follow on our http://www.doomsteaddiner.net/forum/