Last week, Bob Lefsetz extrapolated information from the new book by Anita Elberse entitled “Blockbusters: Hit-Making, Risk-Taking, And The Big Business Of Entertainment” in a blog post entitled “The Most Important Thing You Will Read All Day”. While Bob just quoted an extended passage from the book, the intention is stated in the final sentence of the first paragraph:
The trend is clear: as the market for digital tracks grow, the share of titles that sell far too few copies to be lucrative investments is growing as well. More and more tracks sell next to nothing.
The data is pretty clear and the inference is certainly correct. The share of tracks that sold fewer than 100 units grew from 91% to 94% from 2007 to 2011. Based on the overall number of tracks released in those years, the number of tracks that sold less than 100 units more than doubled, growing from 3.55 million tracks in 2007 to 7.5 million tracks in 2011. The number of tracks that only sold one copy also increased dramatically, going from just under a million in 2007 to over 2.5 million in 2011. Clearly, the inference is that getting involved in music is a fool’s errand because the odds are stacked so much against you.
But the title of this article is that MORE songs are selling. So how can this be? The main reason is because the numbers in this article specifically favored the huge enormity of songs selling under 100 copies and the relative few blockbuster songs that sold over a million. If you extrapolate the number of titles that sold over 100 copies from the percentage data (an admittedly low benchmark), the number of songs sold also increased 37% from around 350,000 titles in 2007 to around 480,000 titles in 2011. In a lot of ways, if you know what you’re doing, the chances that you sell at least a modest something has increased as the public is now comfortable with downloading.
The odds have gotten worse, but this is largely due to the number of artists entering the game. Once again, the real barrier to success is shown to be the competition amongst releases. If it was piracy, then it would be unlikely that we’d see an increase in the number of titles that actually sold. Instead, the number of titles that sold in meaningful amounts went up substantially.
What’s also happening is that distribution outlets such as Tunecore have lowered the barrier to entry so much that the market is flooded with releases put out by artists inexperienced in marketing. The net result is an enormous percentage of titles that fail to sell. On the other hand, if you’re willing to put in some marketing efforts to get started, you’ll vault into the top 5-6% of all releases, which is a pool that also continues to grow.
No wonder people like myself continue to be bullish on where the music business is headed.