We’re often tagged as a nation of content pirates, but for the music industry it seems that data shows Australia to be a ‘holy grail’ nation. Like almost nowhere in the world, in 2009 Australians spent enough money on digital music that it more than covered the drop in spending on physical copies.
Richard Mallett, Head of Revenue for APRA-AMCOS (Australia’s combined groups for performance rights), said in a press conference last week that while physical sales of music dropped by 25% last year the Australian market increase in digital revenue exceeded the drop in physical revenue.
Mallett spoke with a positive attitude toward the future of digital distribution, suggesting that by making it as easy as possible to acquire music by a variety of means it will help the industry continue to grow its digital revenues into the future.
Image by ArtNow314
Daryl
Monday, April 11, 2011 at 1:58 PMunannounced reasons include, but are not limited to ridiculous price hiking
poedgirl
Monday, April 11, 2011 at 2:18 PMAnd I’m sure that if we had even half the legal music services here that are available in the US, that amount of revenue would be way higher. It’s about time they realise that we do actually want to pay for things.
Tomas Medina
Monday, April 11, 2011 at 3:03 PMWho wants to place bets the very next time the piracy argument comes around again these figures will be conveniently forgotten by the music industry officials?
andronicus
Monday, April 11, 2011 at 4:28 PMagreed and thats bad because some of us do want to purchase music legally. i know if I am in need of something ASAP I will just dl it straight to my phone from itunes.
…..its mainly tv and movies im not paying for ;)
Daniel Busoli
Monday, April 11, 2011 at 3:13 PMBecause when we buy digital copies, we’re still charged as if we’re buying physical copies. No physical media, means no pressing, means no storage, distribution, physical retail presence, which means we shouldn’t get charged for it.
Christopher Watson
Monday, April 11, 2011 at 3:22 PMReally? What about the cost of recording and mastering? The cost of session musicians, producers, mixers, technicians? Film clips and advertising/marketing? Tour support?
There is more to the cost of making music than just pressing and distributing the physical media.
Big Windows
Monday, April 11, 2011 at 4:10 PMGenerally speaking I agree. Just not with Justin Beiber.
Big Windows
Monday, April 11, 2011 at 4:11 PMSorry should have made myself clearer there. Like the German tourist said at the Budweiser factory… ‘ What you make here is not beer!’
What Justin Beiber makes… Is not music!
Justind
Monday, April 11, 2011 at 4:16 PMI think Daniel is suggesting that the price should be lower for digital distribution, not that it should be free. There is more to cost than physical distribution, but physical distribution IS a significant cost so there’s definitely room there to cut the price.
And shouldn’t Tour support be be pretty much covered by Tour revenue? Or is it my moral obligation to support tours that I don’t go to?
Christopher Watson
Monday, April 11, 2011 at 6:52 PMI didn’t take it that way when he said
” which means we shouldn’t get charged for it”
I do agree though that digital should not cost anywhere near as much though. Look at what Radiohead, NiN and other independent acts have done with their own releases as an example.
Alexander
Monday, April 11, 2011 at 9:52 PMits pretty cheap when you record it in your spare room with downloaded software… maybe an option for musicians??
Christopher Watson
Tuesday, April 12, 2011 at 9:19 AMWhat about the cost of instruments, the computer, outboard hardware?
I’m a singer/songwriter, and I have been looking to rebuild by studio. Even with the equipment I will still keep (thousands spent on guitars, effects, mics, amps etc) I came up with a bill of about $5K.
Then remember, how much is my time worth? With the collection of songs I already have I could probably record, mix and master in a month – but that won’t pay my bills, hence the day job in IT.
I am horrified at some of these comments and opinions that imply that making music doesn’t cost money and therefore should be free. But I am the first to agree the music industry as it is now is broken, clinging to the revenue generating models that have long since gone flat in a digital economy.
Apple has not helped in the slightest. Forcing artists to standardise the pricing of tracks and albums, with flagrant abuse of international currency rates (please explain how it costs us more to buy music compared to the US when we are at $1.05US to the AU), and becoming the de facto source for digital sales figures, has just shifted the industry from one corporate cash cow to another.
Music shouldn’t be free, but the artists should be.
Brian Lewis
Friday, September 16, 2011 at 10:47 PMI am in the US but producing an Australian music release, so I have just finished my digital and physical distribution investigation and plans. iTunes Aus costs more than iTunes US because iTunes Aus pays the mechanical licensing for the label/performer, US iTunes does not, you have GST, which the US does not. The thing that just turned up is now physical distributors of CDs in Aus want to control the digital distributions as well and take a cut. How much, I don’t know yet, but unless they are paying for all the promotion and PR, I think not, not even if it is a nominal 10%. Small Indies like me can’t seem to get a break for the artists. I am working on a 50/50 gross revenue split for digital and 50/50 net split for physical CDs. The labels like me have got it together, the physical distributor may be the new bad guy.
Thunder Thunder-Mountain
Monday, April 11, 2011 at 4:30 PMI agree with what you’re saying, but the majority public doesn’t think about that. We’ve been taught to pay money for things, not for the background work that goes into things. I never even considered the costs of recording music until I started trying to get into the music industry.
bigricho
Monday, April 11, 2011 at 3:53 PMMy main concern is paying almost cd prices for low bit-rate mp3s.
Tristan Ludowyk
Tuesday, April 12, 2011 at 7:14 PMGood streaming services is what I would like to see in Australia, and as I understand it it’s APRA/AMCOS that is in the way of getting these things. Spotify in Europe is a shiny example – I would gladly pay for something like that!
As for zero-distribution costs for digital music, Apple takes a much bigger cut (41%) than my distributor takes for physical (25%), but then factor in on top of that, you have to use a digital distributor/aggregator that might charge a percentage (25% of what’s left) or a flat fee ($30-100 maybe) to get your music in the digital stores. so by the time the label/artist get’s thir 74c out of the $1.69 pricetag, you have to then use that to pay for recording/mastering/marketing – these are very real costs.
I think it’s bogus to say “people are used to paying for things” – this doesn’t happen with paying for services. Perhaps music should transition in to a service that people pay for (hello.. streaming?)
Tokes
Wednesday, April 13, 2011 at 7:08 AMTristan, there are alternative digital distribution mechanisms which take a lower cut – for example BandCamp takes a 15% cut and you can set whatever price you want for your music.
Brian Lewis
Friday, September 16, 2011 at 10:53 PMTunecore charges $49.95 for the album per year and ZERO cut. Digital distribution is almost free, so complaining about iTunes cut is like complaining about the bookstores cut when you go in and buy a book. We all have alternatives. I agree that there should be a big spread between digital album and physical album the CD costs $19.99 like in Aus, but US$9.99 for an album and a US$13.95 CD price, both are good in my books. Aus retailers seem to mark up a lot especially if the in-store distributor is only getting 25%.
Jeremy
Wednesday, April 13, 2011 at 2:35 PMPhysical distribution is actually quite cheap – less than a buck for the media and printing and cents to ship. The staff to run a store and the rent for the store is where the costs are. On the other hand, online shops are hardly free – editorial staff have to be paid, along with web dev guys, and the gear to run an accredited online music store is not cheap due to security and reporting overheads. Also transfer in australia costs dollars per gig. And yes, I am in a position to know this from actual experience. Buy from bigpondmusic.com if you want to support a local online store with local staff.
Brian Lewis
Friday, September 16, 2011 at 10:59 PMThat is why places like Amazon are great and can be used by any music manufacturer. We can manufacture and ship our own discs to Amazon for $1.20. We can sell them for $14.95 and Amazon puts $9.06 in our pocket after their 15% plus handling costs, and we never have to touch inventory. And they can ship a CD anywhere on the planet for $5. It makes me wonder if I should give up my contemplated in-store sales completely, consider it too old and too expensive, especially if the distributor wants digital distribution rights too or they won’t provide physical distribution any more.