Editorial - Embracing the future and leading the way

Why aren't the major record companies doing it this time around?  

Another day, another dose of bad news from the record industry: this Monday came news of the 3rd quarter's sales from the British record industry. Headlined "Music sales fall despite digital growth", an article in The Guardian stated that despite nearly 25% growth in digital download sales, the UK's music industry had seen its overall market decline by 11.4% by comparison to the same period the previous year.

In an avalanche of figures we learned that sales of singles had in fact risen, and that 99.7% of these are now downloads rather than physical purchases, an incredible figure. Meanwhile sales of physical CDs are in continual decline, whilst the business model of the majority of download outlets - a track at a time à la iTunes - and heavy discounting of albums in supermarkets means both that full album sales, and album revenues, are both falling.

It struck me as I waded through all the numbers and the doom and gloom that somewhere along the line, the mainstream music industry has lost the plot. I admit that this thought was somewhat assisted by an e-mail I'd received the day before, and then a hardware review I read the following day. I'll come back to these in a moment, but first let's go back a few years. Or, rather, right back to the beginning.

Back in the tail end of the 19th century the music industry, right at its birth, was busy undergoing the first of many format wars. To begin with there was the cylinder, courtesy of Mr. Edison. This was swiftly followed by Berliner's flat disc. Both carried acoustic recordings, and both had their pros and cons. Both were promoted by a familiar mixture of exclusive recording deals and claims of higher sound quality - then as ever since the claim was that the recording was indistinguishable from the real thing.

Eventually what the public decided was the superior, or perhaps more convenient, technology won out, and for the next century we got used to buying music recordings on flat discs of one type or another.

The first - and arguably greatest - leap forward for this technology came in 1925 with the almost overnight adoption of electrical recording. Despite effectively rendering their entire back catalogues obsolete in a matter of weeks, record companies jumped at the sonic opportunities offered by the new method, and got busy recording and re-recording, experimenting with live and location recordings, and generally making the most of the new opportunity to bring higher quality to their customers and, happily, make a lot of money for themselves.

Move forward another 25 years and we reach the first format replacement since the abandonment of the cylinder sometime in the teens. The microgroove vinyl disc arrived at just the right time to take advantage of the higher quality offered by new recording equipment and methods, and within a decade of its introduction had been adapted to offer stereo, yet another advance which the vast majority consider an improvement over mono-only replay.

This move to microgroove saw a more cautious approach than the jump to electrical recording. Whilst the major American labels, keen at first to promote their own systems, launched the new format in 1948, it would be a further two years before Decca began offering long players in the UK, and HMV/EMI held off for another two years after that. Somewhere along the line a certain element of conservative caution had entered an industry that, for the first time, seemed less than totally willing to surge forward and push the new technology and more enthusiastic about maintaining the cosy status quo. It took the success of the upstart Decca to force EMI's hand, but soon 78s were, commercially at least, consigned to history, and once again the forward momentum was being provided by the record companies, getting busy recording - and then re-recording in stereo - and bulking out their catalogues in high fidelity sound.

In the late 70s Philips (who owned a record company) and Sony (who soon would) jointly developed the next revolution, again pushing the boundaries of quality, with the CD. Although mainstream pop music was perhaps slower to come on board than classical, the shift from analogue to digital was surprisingly swift and incredibly lucrative. This time the record companies had a very different market, and one which was prepared to pay them a huge amount of money to buy again recording they already owned on the old format.

It seemed a win-win situation. The record industry boomed as never before, making easy money much of the time, while the buyer was happy to spend (in the UK in the mid-1980s) £10 - £12 a time on a CD of a recording they already owned. I know I did, as I gradually replaced the parts of my record collection I still wanted to listen to regularly, and then added to it. I couldn't afford a top of the range record deck which might in any way challenge the sound quality I was getting from a basic CD player, and many happy hours were spent trawling the record shops, large and small, of London in search of long-lost treasures.

Yet all of this history seems to have been forgotten in the online revolution. As CD sales have declined year on year, record shops closed by their hundreds around the world, and revenues declined dramatically, the record industry's big guns seem clueless as to how to respond. First of all it took a computer manufacturer, Apple, to give them a clue - but naturally in such a way as to benefit Apple first and foremost, with the record labels a rather desperate and distant second, their terms and conditions being almost dictated to them by Steve Jobs (RIP) and company.

For the first time in well over a century they'd lost control of the medium and the distribution system, and taken a step backwards in sound quality. Now while it's fair to say that at the outset of the iTunes revolution, a few months before we started up, the MP3 (or similar) was the only really practical way to offer music online. Connections were slow and storage limited and expensive by today's standards, and replay hardware was poorly equipped to deal with a big change in music formats - unlike last time around, the major hardware manufacturer here was (again) Apple, and their agenda was selling iPods, not hi-fi.

But things have changed, and changed very rapidly, since 2004. Numerous hi-fi manufacturers have embraced the idea of streamed audio and music collections on hard drives. The chips which control the new digital devices get cheaper and better every year. Standards emerge and get bedded down through widespread user adoption.

Yet where are the record companies in all this? Busy "fighting piracy" by suing little old ladies in the US courts and trying to hoard yesterday's money by extending copyright laws in the EU so they can repackage and resell The Beatles for another 20 years.

At this point I need to return to that e-mail I mentioned, from a customer in Germany, who wrote: "is there a possibility to get a list of all your 24-bit downloads (albums/recordings)? i am only interested in 24 bit music...". Note that the request here was not for lossless, CD quality, but for the next step up. We're moving ahead to 24-bit lossless recordings while the mainstream record industry has only just managed to negotiate selling The Beatles on iTunes in lossy AAC sound that's a step down in quality from the CDs you can buy (probably for less) on Amazon - or which you can download for free from The Pirate Bay at FLAC files.

The record companies have a chance to innovate, to push things forward, to meet the proven demands of their customers, yet they're heads are stuck firmly in the sand. Why, should I be interested in A Hard Day's Night to add to my music server, are my online legal options here in France paying €12.99 for the lossy iTunes download or paying from €8.20 for a brand new CD through Amazon (or €7.45 for a 'used' one) to rip to the hard drive and then stick in the attic with the rest of the collection?

Where's the CD-quality FLAC download? Where's the super 24-bit FLAC download? Why isn't the entire back catalogue being remastered and sold at 24-bit download quality directly by EMI or The Beatles? They'd make a fortune, especially if the albums weren't forcibly unbundled by the likes of Apple into individual tracks, and were available (as we do) in a tiered pricing system according to quality, allowing the customer to choose - just as was possible in the days of mono or stereo LP choices. An innovative and forward-looking record industry could look to beat the pirates at their own game by offering the customer - the majority, law-abiding customer - what they want at a price that suits them. Instead they're offering CDs in supermarkets for 25% less than they cost 30 years ago - without any adjustment for inflation. No wonder they're making less money today.

Meanwhile that hardware review. A company called Crystal Acoustics is offering a product it calls the Media Match Box. I suspect the name derives from the size of the product. It's very simple to look at - a small black plastic box with an HDMI port, analogue audio and video output, USB input and power, with a basic remote control. It costs less that $75 or £55. It's a very straightforward concept - you plug your storage into one end and your TV and/or hi-fi into the other. Thanks to its super-chip inside, it'll play back just about anything and everything you ask it, and with the digital output you get to choose how well its decoded if you think the on-board sound isn't up to your standards.

It's the modern equivalent to the first budget CD players, in some ways. It makes all the new digital formats accessible to just about anyone and everyone. Add a basic USB memory stick or a 2TB hard drive - it doesn't care - and it'll play whatever music or video or pictures you have on the drive. It's the kind of hardware opportunity which ought to be catching up with the music industry, just as CD manufacturers did in the 80s. Yet there's little or no sign that away from specialist record labels and small independent online distribution systems, the music industry is even aware of the possibilities dangling in front of them, so caught up are they in corporate buy-outs and legal wrangling over piracy and copyright.

They've been offering a clone-able format now for 30 years, and before it millions of hours of music were being copied onto tape for personal use. This isn't about to stop, and is beyond legal control. If the music industry looked to its past it would see that the major booms its had have usually taken place when its been pushing new technology and improved sound, coupled with greater convenience for the buyer. The sooner they learn from this in the 21st century and start to innovate again to offer the same leap forward for the paying consumer, they sooner they'll start to get out of the deep hole they've been digging themselves into for the last decade.

But one senses they'll all carry on digging for a long time to come.



Schnabel Poll

Many thanks to all who've participated in this week's Schnabel poll - at the time of writing there's a firm favourite to accompany the final volume of sonatas, with a majority - 59 per cent - of all votes cast asking for the Eroica Variations. It was great to see a swift and enthusiastic response - perhaps more decisions might be made this way in future!

To ease the fears of those who assumed this would be the end of the Schnabel series let me assure you that I have every hope that more of his HMV solo recordings - including the Diabelli Variations and the various Bagatelles and other sundry pieces - will be transferred and XR remastered in due course.

The battle here is to find source material of suitable quality to endure the kind of processing that XR remastering requires in order to produce the results we've heard in the sonata series. I have a number of discs currently heading my way which I'm very hopeful will come up to the required standard and hope to be able to continue Schnabel's solo Beethoven recordings after the Sonatas series has been completed.

 

 

Andrew Rose
7 October 2011