WEBVTT - The Chaos of the Music Industry 0:00:04.400 --> 0:00:07.760 Welcome to Tech Stuff, a production from I Heart Radio. 0:00:12.119 --> 0:00:14.680 Hey there, and welcome to tech Stuff. I'm your host, 0:00:14.760 --> 0:00:17.960 Jonathan Strickland. I'm an executive producer with I Heart Radio. 0:00:18.000 --> 0:00:21.759 And how the tech are you. We're going to continue 0:00:22.480 --> 0:00:28.000 what I started last Monday, which was an episode about music, 0:00:28.080 --> 0:00:33.320 tech and business, and boy howdy does this get complicated? 0:00:33.400 --> 0:00:36.480 And before we jump right into streaming, which is kind 0:00:36.479 --> 0:00:39.199 of where I left off in the last episode, there 0:00:39.240 --> 0:00:42.040 actually are a few things that I should cover that 0:00:42.159 --> 0:00:45.600 I skipped over in that last episode about how music, 0:00:45.640 --> 0:00:49.519 technology and business are all intertwined. They all have a 0:00:50.040 --> 0:00:54.400 massive effect on each other. I mentioned the concept of 0:00:54.520 --> 0:00:56.920 royalties in the last episode. That is, it's it's a 0:00:56.960 --> 0:01:00.160 fee paid to a composer or copyright owner for the 0:01:00.280 --> 0:01:03.600 use or purchase of a work. So if I write 0:01:03.600 --> 0:01:07.440 a song that's included on an album, and presuming I've 0:01:07.440 --> 0:01:10.240 got a contract that guarantees me a certain amount of 0:01:10.319 --> 0:01:14.080 royalties a percentage, then I am owed a bit of 0:01:14.080 --> 0:01:18.040 money for every sale of that album. It might actually 0:01:18.080 --> 0:01:20.920 be a very tiny amount of money. And first, you know, 0:01:21.000 --> 0:01:23.319 if I were if I was paying advance, that advance 0:01:23.440 --> 0:01:26.039 must be paid off before I start getting royalties, But 0:01:26.120 --> 0:01:31.680 eventually I do get that cash. But what about public 0:01:31.760 --> 0:01:35.240 performances of my song? Like, what about if my song 0:01:35.319 --> 0:01:38.400 is played on the radio, or if it's played on 0:01:38.440 --> 0:01:40.960 the sound system of a restaurant or a bar, or 0:01:41.000 --> 0:01:45.000 a theater or something like that. Well, technically I mowed 0:01:45.080 --> 0:01:48.320 royalties for that as well. This was determined in the 0:01:48.400 --> 0:01:51.040 United States way back in nineteen o nine when the 0:01:51.040 --> 0:01:54.160 Copyrights Act was signed into law, and in the very 0:01:54.200 --> 0:01:57.520 earliest days, it was up to the individual composers and 0:01:57.640 --> 0:02:02.200 IP owners to reach out and royalties and licensing fees 0:02:02.560 --> 0:02:06.000 from the parties that were publicly performing those songs. And 0:02:06.040 --> 0:02:10.720 as you can imagine, that's time consuming and difficult, especially 0:02:10.760 --> 0:02:12.880 if you know you're talking about like a single composer 0:02:13.320 --> 0:02:16.000 reaching out to every radio station that might be playing 0:02:16.040 --> 0:02:19.760 your work. That gets really tough. And keeping them honest 0:02:19.800 --> 0:02:22.400 and being able to get them to pay the royalty 0:02:22.440 --> 0:02:25.959 fees that actually really the licensing fees so that they 0:02:25.960 --> 0:02:30.400 can legally play your work on their stuff difficult. Now. Granted, 0:02:30.400 --> 0:02:32.880 in the early days of radio we were mostly talking 0:02:32.880 --> 0:02:36.520 about live performances anyway, and not recorded once, but you 0:02:36.600 --> 0:02:40.040 get my meaning. So in nineteen fourteen, a whole bunch 0:02:40.040 --> 0:02:43.840 of composers and publishers, led by Victor Herbert, founded an 0:02:43.960 --> 0:02:47.720 organization in the US called the American Society of Composers, 0:02:47.840 --> 0:02:52.320 Authors and Publishers a k a as CAP, a s 0:02:52.320 --> 0:02:55.920 C a P. This organization would perform the services of 0:02:56.040 --> 0:03:01.040 licensing music on behalf of its members and electing royalties 0:03:01.080 --> 0:03:04.960 on behalf for those members. So, in other words, if 0:03:05.000 --> 0:03:07.280 you if you belong to as CAP, you didn't have 0:03:07.320 --> 0:03:10.200 to worry about doing this yourself. So joining the group 0:03:10.200 --> 0:03:13.160 would give the publishers and composers and i P holders 0:03:13.200 --> 0:03:17.320 the benefit of not having to go after various public 0:03:17.320 --> 0:03:20.600 performance venues, as CAP would do it for them. So 0:03:20.639 --> 0:03:22.680 if you ever hear about as CAP fees, that's what 0:03:22.720 --> 0:03:26.919 it refers to. It is just one of many organizations 0:03:26.960 --> 0:03:29.520 that performs this task. As CAP is not the only 0:03:29.520 --> 0:03:32.560 one by any stretch of the imagination. Now, as time 0:03:32.560 --> 0:03:35.720 went on, more groups like as CAP would form. As 0:03:35.840 --> 0:03:39.240 KEPT mainly focuses on America, the United States in particular. 0:03:39.600 --> 0:03:41.920 It does maintain offices and a couple of other countries 0:03:41.960 --> 0:03:45.920 as well, but really it primarily focuses on America and 0:03:45.960 --> 0:03:51.200 American artists. Also, as CAP has had a pretty interesting 0:03:51.280 --> 0:03:53.560 history itself. I could probably do a full episode just 0:03:53.600 --> 0:03:57.080 about as CAP. Prior to nineteen forty, as KEPT would 0:03:57.080 --> 0:04:00.280 demand a five percent royalty fee for broadcast perform says 0:04:00.320 --> 0:04:05.280 of songs. So, in other words, whatever revenue the radio 0:04:05.360 --> 0:04:08.920 station was bringing in at that particular time, five percent 0:04:09.000 --> 0:04:14.080 of that would go to the license holder because of 0:04:14.080 --> 0:04:18.239 that that fee. In nineteen forty, the nonprofit organization increase 0:04:18.320 --> 0:04:22.680 that fee up to a staggering fifteen percent. Now, let's 0:04:22.720 --> 0:04:25.400 say that you run a radio station. Okay, so you're 0:04:25.400 --> 0:04:27.600 on the other side of this. Your job is to 0:04:28.279 --> 0:04:30.880 figure out what music you're gonna play in order to 0:04:30.880 --> 0:04:33.599 fill up air time, and you happen to see that 0:04:33.720 --> 0:04:37.080 any song that's covered by as CAP comes with a 0:04:37.120 --> 0:04:41.719 fifteen percent royalty fee for that time that you're actually 0:04:42.000 --> 0:04:46.000 broadcasting that that song. You're probably gonna look at music 0:04:46.040 --> 0:04:50.520 that's an outside of as CAP, and that that case right, 0:04:50.560 --> 0:04:52.919 because it's such a high fee, and a bunch of 0:04:52.920 --> 0:04:55.840 broadcasters did just that. The broadcasters did the same thing 0:04:55.880 --> 0:04:58.680 that the composers had done back in nineteen fourteen. They 0:04:58.680 --> 0:05:02.200 got together and they created a different performing rights organization. 0:05:02.240 --> 0:05:06.000 This one was called Broadcast Music Incorporated or b m I. 0:05:06.200 --> 0:05:08.039 So if you've heard about as CAB or b m I, 0:05:08.320 --> 0:05:12.000 that's where this comes from. Now, upon the formation of 0:05:12.040 --> 0:05:14.320 b m I, the members of as CAPS saw a 0:05:14.520 --> 0:05:17.960 serious threat here, Like it was very clear that, uh, 0:05:18.240 --> 0:05:20.400 those who were covered by b m I were definitely 0:05:20.400 --> 0:05:22.920 gonna get radio play and those who are covered by 0:05:22.920 --> 0:05:26.080 ASCP definitely were not because of those higher fees. So 0:05:26.160 --> 0:05:29.599 as CAP then readjusted their royalty demands all the way 0:05:29.640 --> 0:05:33.200 down to two point eight percent royalty instead of fifteen. 0:05:34.600 --> 0:05:37.599 And again, there are tons of other performance rights organizations 0:05:37.600 --> 0:05:40.200 out there, you know. One of them is so can 0:05:40.480 --> 0:05:42.680 s O c A N that's out of Canada. There's 0:05:42.760 --> 0:05:45.520 BOOMA b U m A that's of the Netherlands. But 0:05:45.560 --> 0:05:49.400 there are dozens of these and each country pretty much 0:05:49.440 --> 0:05:51.919 has its own, and more than one in several cases, 0:05:52.200 --> 0:05:54.000 and they all pretty much do the same thing on 0:05:54.080 --> 0:05:57.680 behalf of their members. They license music and they collect fees. 0:05:58.560 --> 0:06:00.520 And we'll come back to them in a it because 0:06:00.839 --> 0:06:05.040 the way they work with music streaming services matters. It 0:06:05.080 --> 0:06:08.480 matters a lot, and it is one of those cases 0:06:08.560 --> 0:06:12.720 that we often hear about whenever a music streaming service 0:06:13.400 --> 0:06:16.920 is making an argument that the fees they pay out 0:06:17.040 --> 0:06:21.440 might be might lead to their destruction. Pandora has had 0:06:21.440 --> 0:06:24.520 that argument a couple of times. In fact. All right, now, 0:06:24.600 --> 0:06:28.320 let's cover something that a Twitter follower named John Weber 0:06:28.800 --> 0:06:32.760 pointed out last week. They pointed out that the changes 0:06:32.800 --> 0:06:35.839 in media formats from vinyl to eight track, to cassette 0:06:35.839 --> 0:06:38.479 to c D two, MP three all had an impact 0:06:38.520 --> 0:06:42.279 on consumers and the industry, and I didn't really touch 0:06:42.400 --> 0:06:45.960 on that how the actual changes in media had an 0:06:46.000 --> 0:06:49.279 impact on how the industry made money and how artists 0:06:49.279 --> 0:06:53.680 got paid. And the reason I didn't go into it 0:06:53.720 --> 0:06:57.640 was largely because it just gets super duper complicated. But 0:06:57.880 --> 0:07:00.279 it's a valid thing to point out, so we're gonna 0:07:00.360 --> 0:07:04.000 try and cover a little bit of it. Keeping in mind, 0:07:04.040 --> 0:07:07.680 like I said, this gets really complex. Now. First, a 0:07:07.720 --> 0:07:10.480 really obvious way that the creation of eight tracks and 0:07:10.520 --> 0:07:13.600 cassettes would have on the music industry was that, for 0:07:13.640 --> 0:07:18.040 the first time, recorded music became really portable. So vinyl 0:07:18.120 --> 0:07:20.360 records are great, and they allow us to listen to 0:07:20.360 --> 0:07:23.600 our favorite songs or albums when we're at home or 0:07:23.640 --> 0:07:26.880 you know, if there's like a jukebox that has vinyl 0:07:26.920 --> 0:07:30.080 albums in it or something like that, but it's not 0:07:30.240 --> 0:07:33.480 typically the kind of format that lends itself to portable listening. 0:07:34.440 --> 0:07:37.600 Not that some auto manufacturers didn't give it the old 0:07:37.600 --> 0:07:43.880 college try. There actually are a few different auto mounted 0:07:44.000 --> 0:07:48.920 phonograph type devices, and in fact it goes back decades. 0:07:49.520 --> 0:07:53.720 Um Chrysler offered a highway high FI baggage on several 0:07:53.800 --> 0:07:58.960 car models in the early sixties. The system required proprietary 0:07:59.080 --> 0:08:02.920 records that spun at sixteen and two thirds rpm, so 0:08:02.960 --> 0:08:06.400 you couldn't just put your own vinyl collection on there. 0:08:06.440 --> 0:08:09.560 You had to buy all new records that were designed 0:08:09.640 --> 0:08:12.880 to rotate at this particular speed at sixteen and two 0:08:12.920 --> 0:08:18.440 thirds revolutions per minute. Only Columbia Records was making those albums, 0:08:18.480 --> 0:08:22.440 by the way, so the system wasn't a huge success. 0:08:22.440 --> 0:08:25.280 In fact, it was a flop, probably due to it 0:08:25.360 --> 0:08:29.120 both being really expensive, like it was a big upgrade too, 0:08:29.560 --> 0:08:33.280 you know, have it installed in your new vehicle, and 0:08:33.360 --> 0:08:36.320 you were also really limited to just those special records 0:08:36.320 --> 0:08:39.720 that Columbia produced. So not only were you only limited 0:08:39.720 --> 0:08:44.720 to artists that were represented by Columbia, uh, it was 0:08:44.800 --> 0:08:48.559 the subset of those artists that Columbia actually made these 0:08:48.600 --> 0:08:51.280 special records for that you could even choose from, so 0:08:52.360 --> 0:08:55.880 not great from a consumer standpoint. There were a couple 0:08:55.920 --> 0:08:58.880 of other attempts to bring vinyl albums to cars, and 0:08:59.000 --> 0:09:01.679 in fact, you can find an examples of this if 0:09:01.679 --> 0:09:03.920 you look around. In fact, I'm sure there are cars 0:09:03.920 --> 0:09:05.680 out there on the market that still have some of 0:09:05.679 --> 0:09:10.040 these things installed, but they typically had really big drawbacks, 0:09:10.080 --> 0:09:12.160 like even the ones that were designed in such a 0:09:12.240 --> 0:09:15.680 way where you wouldn't get skipping with the needle, because 0:09:15.720 --> 0:09:17.640 you know, you would think, like, if you're driving down, 0:09:17.640 --> 0:09:20.040 say a bumpy road, then the needle is going to 0:09:20.080 --> 0:09:22.840 skip around on your record. That's gonna be terrible. Well, 0:09:23.559 --> 0:09:25.720 they found ways of making sure that the needle would 0:09:25.720 --> 0:09:29.000 stay connected to the album even if you went down 0:09:29.000 --> 0:09:31.760 a bumpy road. However, that also meant the needle would 0:09:31.800 --> 0:09:35.120 wear out the album faster. So in other words, the 0:09:35.200 --> 0:09:38.400 more you listen to a particular record, the more you 0:09:38.440 --> 0:09:40.440 were wearing it out and you would eventually have to 0:09:40.480 --> 0:09:46.559 replace it. So this really made way for the birth 0:09:46.600 --> 0:09:50.320 of cartridge and cassette technologies, which would store music on 0:09:50.400 --> 0:09:54.520 magnetic tape rather than in grooves on a disk. So 0:09:54.520 --> 0:09:57.600 in the early nineteen sixties, you got the cassette tape, 0:09:57.640 --> 0:10:01.240 but the original cassette tape was terrible and so it 0:10:01.559 --> 0:10:05.800 really didn't take off. Like in the early sixties, the 0:10:05.800 --> 0:10:08.560 cassette tape tried to make a dent, but the audio 0:10:08.640 --> 0:10:10.880 quality was so bad that no one really wanted it. 0:10:11.160 --> 0:10:14.920 But then the Ampex Magnetic Company partnered with our Cia Records, 0:10:15.280 --> 0:10:18.640 the Lear Jet Company, and the Ford Motor Company, and 0:10:18.679 --> 0:10:22.200 collectively they designed the eight track tape specifically for the 0:10:22.240 --> 0:10:25.760 purposes of having an in car audio system where drivers 0:10:25.840 --> 0:10:28.679 could bring along their own music and not depend upon 0:10:28.840 --> 0:10:32.920 radio broadcast casts. Now, at this time, really most cars 0:10:32.960 --> 0:10:36.560 only had an AM radio. FM had not made a 0:10:36.559 --> 0:10:40.400 lot of penetration yet, and so a M was pretty limited. 0:10:40.480 --> 0:10:43.079 And this was considered to be a big, big boost, 0:10:43.600 --> 0:10:45.720 and the technology began to make its way into vehicles 0:10:45.720 --> 0:10:48.320 in nineteen and by the end of sixty five there 0:10:48.320 --> 0:10:51.199 were more than sixty thousand four vehicles that had an 0:10:51.200 --> 0:10:55.040 eight track player installed in them. Now, eight tracks had 0:10:55.120 --> 0:10:58.959 some big advantages over vinyl, particularly the systems that had 0:10:59.000 --> 0:11:02.040 been developed for car. For one thing, the audio quality 0:11:02.080 --> 0:11:06.000 was really good, at least at first. For another, they 0:11:06.040 --> 0:11:10.079 were far more portable than vinyl, albums and and vinyl players. 0:11:10.679 --> 0:11:13.800 The exteriors of these cartridges were pretty durable, so you 0:11:13.840 --> 0:11:15.360 didn't have to worry about getting you know, like a 0:11:15.400 --> 0:11:18.080 scratch on your cartridge and then your music is gonna skip. 0:11:18.880 --> 0:11:21.439 But these eight tracks also had some big downsides too. 0:11:22.040 --> 0:11:23.960 One is that the eight track had a sort of 0:11:24.000 --> 0:11:27.040 never ending loop inside it, which was one way only, 0:11:27.440 --> 0:11:30.360 so you couldn't rewind to listen to an earlier song. 0:11:30.440 --> 0:11:32.160 You had to go around the horn, You had to 0:11:32.160 --> 0:11:34.040 go through the entire length of the tape to come 0:11:34.040 --> 0:11:37.160 back around to the song again. I think, In fact, 0:11:37.280 --> 0:11:39.480 I know several times in the past I've talked about 0:11:39.520 --> 0:11:41.800 turning over an eight track. That's not right. No, it's 0:11:41.880 --> 0:11:45.160 that there's a never ending loop inside the eight tracks. 0:11:45.160 --> 0:11:48.520 So eventually the loop comes back round again and you're 0:11:48.559 --> 0:11:51.120 able to listen to the music that's on that part 0:11:51.200 --> 0:11:54.160 of the loop. Um, but you can't rewind, you can't 0:11:54.160 --> 0:11:59.559 go backward. Um. You. Another big down downside two eight 0:11:59.559 --> 0:12:01.960 tracks was at the capacity of your average eight track 0:12:02.040 --> 0:12:05.079 tape was less than what you could fit on a 0:12:05.120 --> 0:12:08.800 full vinyl album, So the eight track would not be 0:12:08.920 --> 0:12:11.160 able to hold all the songs that you would find 0:12:11.280 --> 0:12:14.439 on the full vinyl album version of whatever you were buying. 0:12:14.840 --> 0:12:17.560 So if you went out and bought UH the vinyl 0:12:17.679 --> 0:12:20.920 and the eight track of the same artists album, the 0:12:20.960 --> 0:12:24.840 eight track would be missing a few tracks. Typically. Also, 0:12:24.920 --> 0:12:27.480 the magnetic tape and the eight track would degrade over time, 0:12:27.600 --> 0:12:30.800 so one common issue was that sound from one track 0:12:30.840 --> 0:12:33.640 would start to bleed into the next track, kind of 0:12:33.720 --> 0:12:36.960 like what happens when UH you are listening to a 0:12:37.040 --> 0:12:40.319 radio station and you start moving into another radio station's 0:12:40.360 --> 0:12:43.960 broadcast range and they start to mesh with each other. 0:12:44.280 --> 0:12:48.800 Very disconcerting. Also, the tape was pretty flimsy, so if 0:12:48.800 --> 0:12:51.400 it caught on stuff, it could easily break, and that 0:12:51.520 --> 0:12:56.800 was another big downside to them. They did have at 0:12:56.840 --> 0:13:01.320 home eight track players, which helped the medium quite a bit, 0:13:01.679 --> 0:13:04.680 so it wasn't just in cars. Cars are are where 0:13:04.679 --> 0:13:07.320 it got its start, but they were at home versions 0:13:07.320 --> 0:13:11.319 of eight track players too. Now, eight tracks had a 0:13:11.320 --> 0:13:13.679 bit of a heyday in the nineteen seventies. They kind 0:13:13.679 --> 0:13:16.600 of peaked at around nineteen seventy eight, but even at 0:13:16.640 --> 0:13:19.440 their peak they were still just a fraction of the 0:13:19.480 --> 0:13:23.040 market of vinyl, and then cassettes were catching up. When 0:13:23.120 --> 0:13:25.600 eight tracks first arrived on the scene. The cassette tape 0:13:25.640 --> 0:13:28.319 already had existed, like I mentioned, but was, for lack 0:13:28.360 --> 0:13:31.960 of a better word, total pants Uh. They were just 0:13:32.040 --> 0:13:34.760 awful with terrible sound quality. But that would change, and 0:13:34.840 --> 0:13:38.040 ultimately the smaller form factor of the cassette and the 0:13:38.040 --> 0:13:40.960 greater capacity that cassette tapes had, like they could hold 0:13:41.080 --> 0:13:45.040 more material, that would spell doom for the eight track 0:13:45.120 --> 0:13:48.040 in the long run. Anyway, even when eight tracks were 0:13:48.040 --> 0:13:50.600 at their peak, they were at about four billion dollars 0:13:50.640 --> 0:13:54.840 in revenue, and vinyl was still at around sixteen billion dollars. 0:13:54.840 --> 0:13:57.480 This is adjusting for inflation, by the way, so vinyl 0:13:57.520 --> 0:14:00.880 was about four times more successful in turn of revenue 0:14:01.440 --> 0:14:05.840 then eight tracks. Eight tracks would never overtake vinyl, but 0:14:05.880 --> 0:14:09.400 cassettes would, and the cassette was doing pretty well by 0:14:09.440 --> 0:14:12.800 the late seventies. They overtook vinyl in nineteen eighty three, 0:14:12.840 --> 0:14:16.240 and then cassettes hit their peak as late as nineteen 0:14:16.679 --> 0:14:19.280 nine and around twenty two billion dollars in revenue. Again 0:14:19.320 --> 0:14:23.520 we're talking about by revenue here, um, But the compact 0:14:23.520 --> 0:14:25.920 disc was a big thing and had overtaken cassettes way 0:14:25.960 --> 0:14:28.840 back in ninety two. This was also when we started 0:14:28.880 --> 0:14:31.680 to see a decline in music sales. This would also 0:14:31.760 --> 0:14:34.240 be around the time when Napster was really active, and 0:14:34.280 --> 0:14:37.440 so the industry pretty much pounced on piracy as being 0:14:38.160 --> 0:14:43.400 the reason why music sales took a downturn, and that's 0:14:43.440 --> 0:14:48.120 when we got all these massive and um overenthusiastic I 0:14:48.120 --> 0:14:53.040 think is a good word over enthusiastic lawsuits against napster 0:14:53.160 --> 0:14:58.040 itself and then specifically users of Napster really meant to 0:14:58.200 --> 0:15:02.640 terrify users so that they wouldn't pirate music, and it 0:15:02.760 --> 0:15:07.400 was insane. Some of the damages that they sought against 0:15:08.240 --> 0:15:12.960 various users of the platforms really painted the music industry 0:15:13.040 --> 0:15:16.600 in a bad light at the time. All Right, we're 0:15:16.600 --> 0:15:19.160 gonna take a quick break. When we come back, we 0:15:19.240 --> 0:15:23.720 will continue to talk about cassettes and then we'll get 0:15:23.760 --> 0:15:26.880 into some of the complicated issues when it comes to 0:15:26.880 --> 0:15:30.920 trying to figure out what these different forms of media, 0:15:31.000 --> 0:15:33.120 what kind of impact they had on consumers and the 0:15:33.200 --> 0:15:44.120 music industry in general. But first let's take this quick break. Okay, 0:15:44.160 --> 0:15:48.520 So cassettes could fit an entire album on them, unlike 0:15:48.560 --> 0:15:50.960 an eight track, So that was one bonus for cassettes. 0:15:51.440 --> 0:15:54.240 They could be rewound. There was another big bonus. They 0:15:54.240 --> 0:15:56.920 were more portable than eight tracks, and the magnetic tape 0:15:56.920 --> 0:15:59.120 tended to be a bit sturdier than what you found 0:15:59.120 --> 0:16:01.920 on eight tracks. The quality of a cassette tape could 0:16:01.920 --> 0:16:04.760 degrade over time, so you know, the more you played it, 0:16:04.840 --> 0:16:09.160 the less good it would sound. But generally speaking they 0:16:09.200 --> 0:16:11.640 were received as being a bit more durable than the 0:16:11.680 --> 0:16:15.560 eight track format, and the music industry treated cassettes a 0:16:15.560 --> 0:16:18.360 lot like the way they treated vinyl, and that you 0:16:18.360 --> 0:16:21.760 could buy full length albums, or you could buy cassette singles, 0:16:21.800 --> 0:16:25.000 which would contain a few songs but not a whole album. 0:16:25.040 --> 0:16:27.600 This gave customers some options. They could buy just the 0:16:27.640 --> 0:16:29.680 singles they liked, or they could get the whole album. 0:16:30.000 --> 0:16:33.840 I don't know how popular cassette singles were, Like, I 0:16:33.880 --> 0:16:37.640 have anecdotal things I could talk about, but that's worthless. 0:16:37.720 --> 0:16:40.440 Right In my own experience, I almost never bought a single. 0:16:40.520 --> 0:16:42.840 I almost always bought an album instead of a single. 0:16:43.320 --> 0:16:46.000 But I did have a couple and there were some 0:16:46.040 --> 0:16:49.200 downside succettes, a big one being that the amazing album 0:16:49.400 --> 0:16:52.200 art of the vinyl era was reduced to a tiny 0:16:52.280 --> 0:16:55.160 fraction of its normal size. That's one of the things 0:16:55.160 --> 0:16:59.600 that vinyl collectors often bemoan is that, uh, the when 0:16:59.720 --> 0:17:03.000 vinyl started to have a downturn, we started to see 0:17:03.040 --> 0:17:06.159 the end or the perceived end of an era of 0:17:06.359 --> 0:17:10.679 amazing cover art. But convenience made up for most of 0:17:10.680 --> 0:17:14.040 the downsides for most people. And now when the compact 0:17:14.119 --> 0:17:18.080 disc started to get popular. So the compact disc debuted 0:17:18.119 --> 0:17:19.720 all the way back in the early eighties, but took 0:17:19.720 --> 0:17:22.280 a while to get popular. Once that happened, things changed 0:17:22.320 --> 0:17:26.520 a bit. Uh. Yes, there are different CD formats out there, 0:17:26.880 --> 0:17:29.719 there are CD singles and things, but here in the States, 0:17:29.720 --> 0:17:33.000 the full sized compact disc was pretty much the standard 0:17:33.359 --> 0:17:36.359 and in some markets the only format available. I'm also 0:17:36.400 --> 0:17:38.480 not going to go into stuff like digital tape because 0:17:40.200 --> 0:17:43.160 going through all the other, at least in the US, 0:17:43.240 --> 0:17:48.159 the other minor media formats would just be overkill. Anyway, 0:17:48.359 --> 0:17:51.680 the music industry was really focused more on selling full 0:17:51.840 --> 0:17:55.080 albums at this point and not singles. That meant, if 0:17:55.080 --> 0:17:57.560 you wanted to get that hit song that you really liked, 0:17:57.960 --> 0:18:00.280 you had to buy the whole dang album if you 0:18:00.359 --> 0:18:03.960 were determined to get CD quality that is, and c 0:18:04.160 --> 0:18:07.520 d s are an optical format, meaning CD players use 0:18:07.600 --> 0:18:11.080 lasers and the lasers read little pits and lands that 0:18:11.119 --> 0:18:13.479 are on the surface of the c D lands. By 0:18:13.520 --> 0:18:16.520 the way, that's just a word. That means the span 0:18:16.880 --> 0:18:21.600 between pits and the pits and lands correspond with bits. 0:18:21.640 --> 0:18:25.880 That is, zeros and ones and songs are represented as 0:18:26.119 --> 0:18:31.040 digital data. So unlike vinyl eight tracks and four tracks 0:18:31.080 --> 0:18:35.560 and cassettes, those are all analog formats, right, those are 0:18:35.560 --> 0:18:39.200 not digital. C d s are digital. Now, I'm not 0:18:39.240 --> 0:18:42.560 going to go into the long debate between digital versus 0:18:42.600 --> 0:18:46.040 analog because I've talked about it in previous podcasts and 0:18:46.480 --> 0:18:49.000 they would push this episode into truly epic length. So 0:18:49.000 --> 0:18:51.680 we're gonna leave that debate behind. It's not really important 0:18:51.720 --> 0:18:55.760 for the purposes of our discussion anyway. So, by the 0:18:55.800 --> 0:18:59.760 average music customer was spending around sixty four dollars on 0:19:00.040 --> 0:19:03.800 music per year, so assuming you're buying CD s, that's 0:19:03.840 --> 0:19:07.200 somewhere between three to five CDs per year roughly. Now, 0:19:07.560 --> 0:19:10.640 all through this time, the music industry was making huge 0:19:10.680 --> 0:19:14.399 amounts of money. We're talking like around forty billion dollars 0:19:14.480 --> 0:19:18.040 in nine in the United States, and much of that 0:19:18.200 --> 0:19:22.520 was due to the packaging of music the bundling of music. 0:19:23.000 --> 0:19:25.480 Like I said, CDs pretty much forced people into buying 0:19:25.480 --> 0:19:28.359 whole albums even if they only wanted a single song. 0:19:29.240 --> 0:19:32.639 Even cassettes which did have those cassette singles were priced 0:19:32.640 --> 0:19:34.119 in such a way that I think a lot of 0:19:34.119 --> 0:19:37.040 folks just elected to buy the whole album rather than 0:19:37.080 --> 0:19:40.800 spend more on a per song basis, Like a cassette 0:19:40.840 --> 0:19:44.359 single would be less expensive than the full cassette. But 0:19:44.440 --> 0:19:47.200 if you were looking at it on a per song basis, 0:19:47.240 --> 0:19:50.000 like like you're looking at it like grocery shopping, like 0:19:50.040 --> 0:19:52.760 how much is this per ounce, then a full album 0:19:52.920 --> 0:19:58.159 was more economically uh sound, I guess. But in the 0:19:58.240 --> 0:20:01.480 late nineties, digital music al formats were poised to make 0:20:01.520 --> 0:20:04.840 a huge difference to create the opportunity for consumers to 0:20:04.880 --> 0:20:09.160 buy music in a different way, an unbundled way, because 0:20:09.200 --> 0:20:14.480 you could start buying songs individually rather than buy full albums. Now, 0:20:14.520 --> 0:20:16.880 before I get into that, I need to add that 0:20:17.359 --> 0:20:19.800 the year that recorded music peaked is another one of 0:20:19.840 --> 0:20:22.560 those things that I find conflicting information on a lot 0:20:22.600 --> 0:20:25.879 of sources suggest that it was ninety nine. That's what 0:20:25.960 --> 0:20:29.399 the Recording Industry Association of America says that recorded music, 0:20:29.440 --> 0:20:31.560 as in music, you would go out and purchase a 0:20:31.600 --> 0:20:34.240 copy of like a physical copy of peaked in nine 0:20:35.400 --> 0:20:37.159 But that's where the United States. If we actually look 0:20:37.160 --> 0:20:39.480 at the global market, the peak was even further back 0:20:39.520 --> 0:20:42.960 in nine six. That was with a global revenue of 0:20:43.000 --> 0:20:48.480 around sixty billion dollars. As for artists cuts of you 0:20:48.520 --> 0:20:51.040 know how much did artists get for these different kinds 0:20:51.080 --> 0:20:55.000 of media. Those changed over time too, So back in 0:20:55.760 --> 0:20:58.360 three for example, and artists would get about eight percent 0:20:58.640 --> 0:21:02.080 off the sale of an al boom costing eight dollars cents. 0:21:02.080 --> 0:21:05.520 This is from a book by Steve Knopper called Appetite 0:21:05.520 --> 0:21:09.960 for Self Destruction. Now is the same year that the 0:21:09.960 --> 0:21:14.280 compact disc debuted. It would only only early adopters really 0:21:14.320 --> 0:21:17.439 win after CDs that that at that point because they 0:21:17.440 --> 0:21:19.040 could only they were the only ones who could afforded 0:21:19.359 --> 0:21:21.560 CD players when they first came out were a couple 0:21:21.560 --> 0:21:23.920 of thousand dollars. So it wasn't the sort of thing 0:21:23.960 --> 0:21:26.480 that the average teenager could rush out and purchase, at 0:21:26.560 --> 0:21:31.399 least I certainly couldn't. And uh, once you get to 0:21:31.440 --> 0:21:34.000 the point where c d s were starting to become 0:21:34.600 --> 0:21:38.800 the standard, where cassettes were starting to fade away, and 0:21:38.960 --> 0:21:43.439 artists share off a sixteen dollar c D was just five. 0:21:44.320 --> 0:21:47.480 So remember the final album, they were getting an eight 0:21:47.480 --> 0:21:49.959 percent cut off of what was like an eight dollars 0:21:50.480 --> 0:21:55.040 cents sales price, and with the c D it's a 0:21:55.119 --> 0:21:59.080 five percent cut of sixteen dollars. So the CD cost more, 0:21:59.119 --> 0:22:02.280 but the artists got a smaller percentage of the sale. Now, 0:22:02.320 --> 0:22:06.320 gradually CD prices increased and artist shares also increased. They 0:22:06.320 --> 0:22:09.600 went up to ten. By the way, when it really 0:22:09.600 --> 0:22:12.160 comes to comparing how much artists earned and how much 0:22:12.240 --> 0:22:16.400 music was worth across different formats, it quickly becomes a jumbled, 0:22:17.200 --> 0:22:20.680 chaotic mess. It. I mean, it really does become impossible 0:22:20.720 --> 0:22:23.760 to talk about in any meaningful way. The fact is 0:22:24.080 --> 0:22:26.959 there's just not really any rhyme or reason to it 0:22:27.040 --> 0:22:30.480 when you really look across the years. Pitchfork has a 0:22:30.560 --> 0:22:33.359 really great article about this that came out in two 0:22:33.400 --> 0:22:36.359 thousand fifteen, so it is dated, but the article is 0:22:36.400 --> 0:22:40.919 titled how much is Music Really Worth? I recommend that article. 0:22:41.160 --> 0:22:43.280 That's a good read if you want to learn more 0:22:43.320 --> 0:22:45.640 about this, and it really lays out that the price 0:22:45.640 --> 0:22:49.160 of music has gone all over the place over the years, 0:22:49.160 --> 0:22:52.560 So Pitchfork adjusts all the prices to match two thousand, 0:22:52.600 --> 0:22:55.640 fifteen dollars because that's when the article came out, and 0:22:55.960 --> 0:22:59.560 you see really crazy amounts, like like a an eight 0:22:59.560 --> 0:23:02.959 track album of Jimmy Hendricks's Are You Experienced in nineteen 0:23:03.000 --> 0:23:08.159 sixty eight cost fifty three dollars ninety six cents for 0:23:08.160 --> 0:23:10.280 for that one album, keeping in mind that eight track 0:23:10.359 --> 0:23:14.040 albums can't hold as much as vinyl. Uh It also 0:23:14.080 --> 0:23:16.760