While the age of the digital era has evolved to a level of maturity today, the question that is often being asked is whether the revenues earned from streaming — through subscriptions and ad support — has offset the revenues lost from sales of physical formats.

The answer is an emphatic “no” and, more importantly, the question that should be asked is: Have music revenues, which have been declining mostly on a year on year basis, finally bottomed out? While it would be easy to say “yes” for 2013, do remember that there are still three full months left before the calendar year closes, and if you have been in the music trade long enough, the impending festive season — like Diwali, and Christmas, for example — is usually a period for gifting. But, what impact the “season” will have remains moot, as it really is difficult to fathom a friend or relative gifting a streaming/downloading voucher which does not quite have the same impact as gifting a CD.
Which brings me to the point that even today — shock! — CD still provides global music its largest revenue. If you look at the world’s five largest music markets for 2012, this is what the share of the physical format has in them: North America (34 per cent), Japan (80 per cent), UK (49 per cent), Germany (75 per cent), and France (64 per cent). So where is India placed in the top music markets in the world? A credible number 14, with physical still providing 31 per cent of her total revenue. With revenues from the growth in digital sales not compensating for “lost” CD sales goes to show that CD buyers are quite simply not buying music, rather than going digital.
How true. Take me, for instance. I first purchased a CD player — Sony CDP 39, if I recollect correctly — 24 years ago, some seven years after the hardware was commercially launched in October 1982 along with the first album on CD, Billy Joel’s 52nd Street, in Japan. For the trivia-minded, the first artiste to sell a million copies on CD was Dire Straits, with their 1985 album, Brothers In Arms.
Both titles form part of a personal collection of a thousand CDs, the initial library being built on purchases during foreign trips. During the late 90s, however, Indian record companies commenced manufacturing CDs locally and with it, the prices fell; but before that, imported single CDs would retail at a princely `550. Nevertheless, it was still cheaper buying CDs in India than purchasing them abroad.
It also takes me back in time when I first heard music through vinyl, which was once the only physical format available for consumers. Of course, those who could afford to install a music system in their cars then, besides players that were built for 45rpm vinyl, matured to tapes with the introduction of eight-track cartridges — or Stereo 8 — during the late 60s. I distinctively remember the cover of instrumental specialists The Ventures’ Golden Greats that had a blond woman clad in a golden outfit. Later, there was a time when quadrophonic vinyl was introduced; I still have a copy of Chicago’s IX: Greatest Hits, released during the 70s, but I could never hear it with four channels, as by the time the concept was introduced, it proved to be a non-starter.
The musicassette followed, which has since been rendered obsolete, but will always be remembered as the first format to introduce piracy. The Digital Audio Tape (DAT) followed in 1987, introduced as a digital alternative to the MC, but it never worked with consumers because of the prohibitive cost of the hardware, and was relegated to studio usage. Sony launched the MiniDisc a year later, but it also proved to be a non-starter, although I have one of Roxette’s albums on it (Have A Nice Day). As we moved into the new century, CDs as they are still known to us today, had peaked. The DualDisc (DD) was introduced as CDs’ new avatar with the conventional CD backed on the flip side with a DVD of the artiste performing the same songs live. That did not work either, and I never found sufficient reason to experiment with the DD.
By 1995 though, the now ubiquitous MPEG Audio Layer III, more commonly referred to as MP3, had been introduced. Record companies were rightly concerned about this format, which in many ways is the “last” new format that they and we — as consumers — will ever witness. The recording industry has never been the same again…
— The writer has been part of the media and entertainment business for over 23 years, still continues to pursue his hobby, and earns an income out of it!