No matter
how many music stores one may pop into, they will only cover a small fraction of
all the music ever released. For example, when albums leave the charts and
sales fall to the point where it is no longer cost effective to keep them
published in a physical (Audio CD) forum, not to mention retail shelf space,
they stop making these. As a result, there is a vast number of albums that
will never be released as a physical format again.
Now with the take-off in digital music services,
this is beginning to change, since the cost of storing music in digital forum is
very low. The world's largest music label, Universal Music Group, is one
to make use of digital music services in an aim to make over 100,000 songs
available to the public once again that likely never see life as a physical
format.
As expected, Universal has no idea how well this
music will sell, however unlike physical CD releases, they have little to lose
if it fails to do well. In fact, one of the main reasons Universal is
doing this is to make up for the recent 1.9% fall in the revenue of CD
sales. To start with, Universal will make ~3,000 of these tracks
available from Britain, France and Germany and aims to push this figure to over
100,000 over the next four years. The pricing is expected to be around
€6.99 or $8.50 per album.
|
Vivendi Universal SA's Universal, the world's largest music company, is reviving more than 100,000 European tracks no longer released in physical form for digital downloading on services such as Apple Computer Inc.'s iTunes service, London-based Universal Music Group International said today. |
Despite all the negative effects the music industry has experienced with the
Internet, it is coming to a time where online music services are turning out on
a positive side. For example, unlike CD sales, there is no cost involved
with replication lines, CD & jewel case material costs as well as no
shipping, shop/staff or rental costs with online music stores apart
from what ever it takes to run the central base. This means that while the
music labels may only make a fraction of the sales online compared with in the
shops, they get a much bigger chunk out of each song sold online due to the low
cost involved per song or album.
Now at lesat the record labels are finally beginning to realise how well
online digital music download services perform for old music, since there is
little extra overhead in releasing old songs compared with new music, even if
most of the old songs fail to ever make a sale.
Source: Bloomberg - Europe
