An inconvenient truth: Physical formats capture 80% of
the album market
The calls from aggrieved ERA members started within
minutes of the BPI pre-BRITs sales announcement the other
day.
"Brainless" was one of the more heated comments.
The cause of their ire was the relentlessly pro-digital tone of
the BPI statement about
annual record company revenues.
It concentrated almost solely on the growth of digital revenues,
though these remain less than half the value of revenues from
physical product.
It highlighted the growth of subscription services, now worth
£24m, certainly creditable but, to put them in context, less than
one twentieth of the value of the CD album market.
Physical formats were referred to only in terms of their
declines, but the statement managed to omit the fact that physical
formats accounted for over 80% of albums revenue in 2011 - some 10
years after the beginning of the digital music revolution.
ERA is a broad church and its membership includes many of the
key innovators in the digital music market and so as an
organisation it is certainly not anti-digital. It is pro-digital
and pro-physical.
It is probably fanciful to suggest, as some do, that the BPI is
now actively discriminating against physical retailers and in
favour of digital. It is more likely that the trade association
simply wanted to promote a positive story ahead of Tuesday's BRIT
Awards.
But with growing concerns that the physical market is declining
at least as much due to a lack of commitment by suppliers as to
lack of enthusiasm from consumers,
expect to hear more of this issue in coming weeks.