2009 Is Record Year For UK Singles Sales
Innovation boosts record label income as licensing and rights deals generate £195m in 2008
New business models boost income for British record labels: licensing and multiple rights deals net £122m in 2007
New BPI Stats show strength of digital music
Just some of the headlines from a group of people not known for their progressive thinking when it comes to music and downloads and filesharing.
But let’s not look at the headlines. Let’s look at the facts:
2009 has already become the biggest ever year for UK singles with more than 117m sold to date, recorded music body the BPI today announced.
“Sales of single tracks in 2009 have now surpassed the previous all-time record of 115.1m, set in 2008. The total of 117m has been reached with 10 weeks of trading, including the vital Christmas period, still to run in 2009.
“That singles have hit these heights while there are still more than a billion illegal downloads every year in the UK is testimony to the quality of releases this year and the vibrancy of the UK download market. Consumers are responding to the value and innovation offered by the legal services and these new figures show how the market could explode if Government acts to tackle illegal peer-to-peer filesharing.”
“The UK Top 40 is now almost entirely comprised of digital singles. During this year, 98.6% of all singles have been retailed in digital formats. More than 389.2m single track downloads have now been sold in the UK since the launch of the first mainstream online stores in 2004.
All from that well-known friend of illegal downloaders and filesharers, BPI. I have to consider the statements to be largely factual since they have no incentive to report these particular numbers falsely.
It’s not just about digital sales either. The Beatles are reported to have sold 2.25 million albums in two weeks recently. Again, data with some backing.
I like numbers. But not when they’re Numbers of Mass Distraction (NMD). Not when 136 people can become 7 million people.
Why should I care what numbers are bandied about in the press? Why should I care when someone says “Only 1 in 20 downloads in the UK is legal” or words to that effect?
Well, maybe the excerpt from Wikipedia on WMD will give you some idea why:
When “tentative” numbers get repeated often enough, even if they get corrected later, people tend to remember the original “tentatives”. That’s what the research shows. And by the way, when I refer to numbers or research, I try and refer to the source openly and transparently.
The ITU projects the total number of broadband connections in the UK to be 18.4m by the end of this year. Let’s take that number for a start.
BPI then says that there are already a minimum of 117m legal downloads this year, with 20% of the year to go. Without even going for seasonal adjustment to allow for Christmas, let’s take a worst-case legal download total for 2009 to be 150m or thereabouts.
If we then take the Mandelson pronouncement that only one in 20 downloads is legal, that would assume that 2009 will see 3 billion downloads in the UK. There’s been a similar pronouncement that we have 7 million illegal downloaders in the UK, which was the previous NMD or Number of Mass Distraction.
So let’s try and see whether these numbers look sane, smell right. 3 billion downloads represents 163 downloads per broadband connection per year, or one illegal download every two and a quarter days. Do you know anyone who buys a single every other day? Would you believe it if you were told there were people who did that?
Hang on a second. Why should I use the 18.4 million ITU overall broadband lines in the UK number? What happens if I use the 7 million NMD number? Now I have to believe that there are seven million people in the UK who download 429 singles each illegally every year, or 1.17 every day.
The 117m figure is solid. There is money to show for it. Till receipts.
The 18.4 million is solid. There is money to show for it. Telco billing records.
The 3 billion figure is an estimate based on digits (of the finger kind) whirling through the atmosphere.
The 7 million figure is an estimate based on conversations with 136 people.
If the 7 million figure is correct, then it means that nearly two in five people with broadband in the UK are illegal downloaders. People in the UK reading this post will know other people in the UK with broadband connections. Does this seem reasonable?
If the 7 million figure is wrong, do you think it is wrong on the low side or the high side? Imagine what that does to the daily illegal downloads that 40% of your friends now have to achieve as a NMD target.
I tend to think that maybe, just maybe, the 7 million number is a tad on the high side.
So now let’s move to the other number, 3 billion. If we assume 61.4m people in the UK (Source: National Statistics Online) then we’re talking about one illegal download every week or so for every single person in this country. Does that feel reasonable to you?
Let’s say the number of illegal downloads is not 20 times the number of legal downloads. Would you think the right number is higher or lower?
I tend to think that maybe, just maybe, the 20 times number is a tad on the high side.
Numbers can be so distracting. But let me not paint a gloomy picture. Taking the statements of the BPI alone and the events of the past year or so:
- There is evidence that the number of legal downloads sold is sharply on the increase.
- There is evidence that new business models are emerging, from iTunes through to OneBox, from last.fm through to spotify and we7.
- There is evidence that people in the UK care about their digital futures.
My thanks to Robert Crumb for not copyrighting this image in 1968.
The second genius insight I have read today. Brilliant work. Thank you for the musing. A genuinely fresh and enlightened perspective.
There is another aspect to this debate that we must not forget supported by Kevin Kelly (http://www.edge.org/3rd_culture/kelly08/kelly08_index.html). We were told again and over again by economists not to confuse ‘value’ and ‘price’. A school teacher could be more important in the society than a football player though football players are wealthier due to ‘the economic reality’. No problem in that; we understand that in free market capitalism it happens. Now suddenly what is stopping us from realizing that since ‘digital content’ can be copied trivially, future technology may make direct selling of the digital content economically ‘unviable’? That artists should be ‘rewarded’ is value judgement, only strict socialism imposes such value judgements on society. In free market the business models have to move on and adapt and try to ‘sell’ something else that is not copyable. And by the way, about musicians supporting anti-piracy, there is nothing so new about ‘artisans’ gaining from older technology complaining about how they may lose their millions with this change.
JP – Aaron here. How are you? Just one thing to consider. What if the figures are based on tracks downloaded? If every track downloaded is separately counted, there are a lot of people who certainly will bulk download. A friend of mine who first found himself on a file-sharing site downloaded every available tune he could find of Sigur Ros (and like it all so much he bought the albums to support them band by the way). I think it was 200 songs. But one download event. Just a thought….keep musing, it’s brilliant!
You’re right Aaron. Nice to see you here. The problem with the statements that have been made around downloads is that there’s rarely any attribution. Bullying and scaremongering are more common in these sorts of debates than you would think, which is why I used the term NMD. The approach is similar in many respects.
IFPI, who pushed the 95% number, also claimed that the total annual number of illegal downloads was in excess of 40 billion. *Billion*. So somewhere we have a bear of little brain actually believing that the music industry has lost revenues to the tune of $35bn or so. This, for an industry where the RIAA claimed total digital and physical shipments 2008 were around $8.5bn.
Words don’t fail me. I just won’t waste any more on them tonight.
BTW I will be in Boston in Nov and in Dec. Will ping you dates. Dinner sometime?
A little while ago, I tried to make sense of another set of ‘official’ numbers here: http://www.techbelly.com/2009/05/30/filesharing-numbers-dont-add-up/
I came to the conclusion: “with these numbers, even if every broadband-connected household in the UK was involved, some 48 hours of pirated content would be being watched by each of them online, every week.”
The numbers being bandied about are tissue-paper solid.
funny – does it not occur to the BPI that maybe sales of singles are at an all time *because* of all the illegal downloads, not in spite of them? what better way to get someone to buy your product than to give them a free sample…?
I am absolutely amazed at these numbers and it shows that the worries of the big companies and artists about illegal downloading killing the biz are totally unfounded. Nice insights too
It is all about the social, the way everything is going IMHO.
Kids will buy singles, just like we did or do, due to recommendations from friends. Pressure from advertising only goes so far, it might make you try the song, but maybe not purchase.
Whole model is thankfully going the way of DVD, to rental. LaLa and co is a much better model. Also like Zumodrive, stick my content in the cloud with both solutions, access it from many places. Exactly what I do with Flickr. Stick it one place access it in loads of other places.
Mark
Great contribution JP.
If Mark is right, of course, then for the mass market a web service wins and not a web application which requires to be downloaded. i certainly believe this to be the case, at least for music discovery. I am not convinced on rental vz ownership for my own music collection. Why would i junk my investment in past purchases and then rent it all back in perpetuity? I don’t mind this for films – i only watch most once and novelty is crucial; and even ultra favs films i watch maybe only 6 times. But, by contrast, i listen to fav music tracks sometimes 6 times a day…..
So maybe there are multiple use-cases, as you would expect.
But i am on the other hand quite certain that defeating piracy is not about just offering new ways to pay, rental vz purchase. Murdoch bangs on about pay-walls; but news piracy has not been a big issue because on-line news was free to air and funded by advertisements from 1995 (I can claim significant responsibility…).
Of course ads wont pay for all content. But it will pay for all ‘good’ content. Where ‘good’ means ‘popular’ for sure (whats new?), but also popular with niches of economically valuable consumers (worth advertising to and generating leads for). and ’twas ever thus – consider the black blues and the ‘white blues’. Eventually the roots are uncovered and black blues/Fada/ Gregorian chants can become ‘popular’ too. Its not pretty but it is capitalism.
btw we7 started with ad funded downloads and this would really help the industry in my view – we can attach a download to a song; when you hear the song you hear an ad tailored to you. But the music industry is focussed for now on streaming being the solution for ad funded content. I think it is a big part of the solution, which is why we7 has focussed on streaming, but i still think in the bandwidth environment we will be in for the next 5 years, ad funded downloads would be a great help too for those who cant or wont pay. Maybe the industry will eventually agree.
John Taysom, Chairman and Founder, we7.
I am sure that music companies will continue to kick and scream about illegal downloading but the figures speak for themselves. They really should be encouraging the micropayments model to increase sales however they can
It will be interesting to see what the industry reaction is. John’s comments about the reactions to it including what Murdoch is proposing to do are interesting. I think Murdoch’s scheme will fail horribly but in order to succeed temporarily it doesn’t need to convert many customers into paying ones
Seems like Murdoch wants to go ahead and try it out. Can’t see it working either