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January 04, 2006

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» What Makes a Hit? (Part II) from ENCYCLOPEDIA HANASIANA
I've gotten caught up in the blockbuster discussion over at the Long Tail that I blogged about earlier. Chris Anderson has now posted a chart showing how many Gold, Platinum, and Diamond awards the RIAA has given out each year.... [Read More]

» What Makes a Hit? (Part II) from ENCYCLOPEDIA HANASIANA
I've gotten caught up in the blockbuster discussion over at the Long Tail that I blogged about earlier. Chris Anderson has now posted a chart showing how many Gold, Platinum, and Diamond awards the RIAA has given out each year.... [Read More]

» The Decade The Music Died from Ed Driscoll.com
Chris Anderson writes that this is the decade the blockbuster album died. I'd say that reflects as much on the poor content of today's CDs as it does the impact of file sharing and the Long Tail, but be sure... [Read More]

» The Decade the Blockbuster Died from Right Mind
The Long Tail has put up two disturbing graphs of how bad it's getting for the music industry. I recommend... [Read More]

» Heat's Dash Levels Mavs from of Games 1 and
all the euphoria in and around Dallas after the Mavericks' domination of Games 1 and 2 of the NBA Finals, [Read More]

Comments

Jim Rockford

Chris a few comments:

1. It might be useful to compare how many albums total were released each year; sales figures per album would tend to rise if only a few were released; drop if a flood of albums were released.

2. Repeat artists who've sold platinum or whatever before. A new album by U2 is likely to do well, same for the Beatles or Elvis in their heyday. The latest BH Surfers or Flaming Lips likely not so much.

So maybe these data points could add to understanding what's going on?

Barry Ritholtz

A few thoughts on this:

• No surprise here, but it had to be said: The Blockbuster chart is an exaggerated parallel to the total sales chart for CDs. People are spending less time and money on CDs, and more on everything else. Internet, video games, DVDs, etc.

• Music was originally a live medium, then a recorded one, and has since seen live performances become more ascendant. In other words, the blockbuster peak of CDs was an expected aberration -- like a stock market bubble top -- and is now reverting to a more moderate measured level.

• Popular Music's evolution went through several distinct phases. Back in the day, a handful of radio stations played the same few songs and everyone heard them. Both the music and the Media is much more diverse, making it harder to develope the critical mass for a blockbuster.

Not only has music digressed into increasingly finer sliced genres, but it was easier to sell a Blockbuster in the pre-"niche-ification" era --before world/hiphop/house/jam/electronica/speedmetal/etc.

• Boomer generation retiring = less music sales, less blockbusters. Do not discount 60s/70s saw a rebellion against the prior generation's tastes.

Dan Calladine

Chris,
I think that this is a really good debate. Thank you for the data you've quoted!
I'd like to add two points:
1 - Books - the Da Vinci code is one of the best selling books ever. Similarly Harry Potter.
2 - Films - The LOTR films are among the most successful films ever (OK, not adjusted for ticket prices etc). Looking at this list
http://www.imdb.com/boxoffice/alltimegross?region=world-wide
Seven of the top ten postions - and 13 of the top twenty - are taken by films released in the five years of this decade.
Music might be a special case in that consumers do not need to buy physical units any more, but can download portions (songs) rather than the complete package.
Dan

Brandon

A few things worthy of keeping in mind on these items:

- When talking about money over time, don't forget economics of adjustment. After all, 2005 $ are not the same as 1965 $ (inflation and similar phenomena to keep in mind here)

- Also as relates to money, is it important to keep in mind just how much disposable income is available? After all, it was probably harder to have blockbusters in the 1930's since during the depression, people wouldn't have gone to movies as much (my simplistic assumption). So is some normalization necessary to consider what the population of people is that would buy ____ (any given movie, CD, etc) based on how much disposable income they have ...

- And, that brings us into a global perspective. Was the 1933 King Kong quickly released in a dozen countries? This relates to disposable income, but also to the global economy that's emerged in the past few centuries.

Then again, maybe I'm trying to take this all too far. Your thoughts?

Dan Calladine

Brandon,
Agreed on all those points - but these are just illustrations that in other cultural industries there are still very big hits.
I read I, Fatty by Jerry Stahl over the Christmas holidays and it's a really good evocation of how much cash (comparatively) there was floating around in the silent movie era for the stars. Fatty Arbuckle was on >$1m per year in the 1920s.

http://www.amazon.com/gp/product/1582345821/qid=1136477564/sr=8-2/ref=pd_bbs_2/102-4540244-3981737?n=507846&s=books&v=glance

But as I say the cases i quoted were only examples of recent blockbusters outsite the music industry.
Dan

Greg

Something which might be interesting is to divide the number of Gold+ albums by population for each year. Since Gold, Platinum, etc... are based on a scale of albums sold, the greater number of people in the populace may tend to push more albums gold+.

chris anderson

Greg,

I don't think that would make a huge difference. The number of hit albums tripled in the decade from 1990 to 2000, while the population grew by only around 10%.

J-Lon

The other thing to bear in mind is that before 1991 or so when Soundscan was implemented, sales were calculated based on the number of records shipped, not on the number of records actually sold. This system was frequently manipulated.

Retailers are typically free to return any records they don't sell for full credit. So sales figures from the period before 1991, are even less acurate than the ones from today, because a record might ship Platinum, and then return Gold, or worse ship Gold and then return Platinum by the time all was said and done.

Given this major shift in the methodology of keeping track of sales. I'm not sure how much of a meaningful long term analysis you can really do. But I applaud you for trying.

Personally, I'm a little skeptical that the downturn in blockbuster sales is primarily attributable to structural changes in the market. I think risk aversion and bad music has more to do with it. This has happened many times in the last 50 years. There are valleys and peaks. This one may be the worst. But I won't be at all surprised if it turns around in the next 3 years or so. It may not look exactly the same as it has. But when people make good, somewhat adventurous, mass market music, and it gets the marketing dollars, it sells big numbers.

Randy

Remember, the RIAA awards gold/plat albums for # of albums *shipped to retailers*, not sold to consumers.

Jim Reekes

Another NYT article on the long tail of the music industry...."Buying Music From Anywhere and Selling It for Play on the Internet" by Robert Levine

http://www.nytimes.com/2006/01/09/technology/09orchard.html

patrock

Another thing about tracking and soundscan is that to the RIAA, a "unit" is a "unit". It does not discriminate betweeen format, re-release, re-master, repackage. So, over the years, something like The Eagles "greatest hits" has been re-released on 15 different formats. So, then you have geeks like me who have bought Ac/Dc's "back in black" on vinyl, cassette, CD, re-mastered CD and then DualDisc. I have now clocked 5 "units" for the RIAA tracking for that record. So, you could say that the longevity is somewhat due to repeat business.

Tyler Cowen

There is considerable data on the decline of the blockbuster effect in my book *What Price Fame?*.

David Blackburn

Just a quick thought: why not just look at Gold certifications, to avoid any issues with counting an album multiple times?

Glenn

I wonder if there's a correlation between the increase in gold (and beyond) certifications and the number of record labels in the country.

If that's the case, what's the impact of consolidation? Labels have merged and trimmed their rosters quite a bit over the last seven or eight years. Do fewer labels mean fewer hits?

Or do more indie/small labels mean fewer hits? The number of releases every year is staggering, and with digital distribution it's only going to rise. Niches are on the increase. The Internet serves niches very well.

Bad music is always a cause people fall back on, but it's far too subjective and I dismiss it as a cause for the drop in hits. The music industry has always churned out bad records. (Oh sure, everybody remembers Zeppelin. What about Andy Gibb? Starlight Vocal Band?)

Slav Zat

It may not look exactly the same as it has. But when people make good, somewhat adventurous, mass market music, and it gets the marketing dollars, it sells big numbers.

wii spiele

I never liked Blockbuster. But I’ll be sorry if it goes under.

The new Netflix surcharges for Bluray access strike me as a stealth price increase; with the Post Office losing money and asking for higher rates, this will put more pressure on Netflix to raise its prices.

The competition with (mainly) Blockbuster was keeping Netflix prices low. If Blockbuster dies, all us Netflix users might pay more, and more.

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Tidbits

The Long Tail by Chris Anderson

Notes and sources for the book

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