Vinyl in the Time of Covid-19

 

On Thursday I was interviewed on the fruity American television programme LIT Entertainment News about a turnaround: in America vinyl records are outperforming compact discs. Trade figures for the first half 2020 demonstrate that vinyl sales constituted 62 per cent of the revenues for physical formats. It was the first time since the 1980s that vinyl had generated more money than CDs.

            This is something that had been predicted. Sales revenues for vinyl records have increased every year since 2006. Sales revenues for compact discs, in contrast, have declined annually since the millennium. When 2019's trading figures were announced it was predicted that, if trading patterns continued, vinyl would be on course to surpass CDs. Some people called this a long time ago. In my book Vinyl: A History of the Analogue Record, I quote the music journalist Adam Woods, who stated in 2004, ‘it is easy to believe that the format could thrive even as the CD begins to lose ground to the Internet’. I also have a 2011 quote from Lyor Cohen, who was then the CEO of the Warner Music Group, stating that ‘vinyl will definitely outlast CDs’.

It should be noted that vinyl is outperforming compact discs in terms of revenues but not in terms of units sold. One of the reasons why vinyl is generating more money is because each album typically costs two and a half times more than a CD. It is also the case that, in our time of lockdowns, it is more likely that consumers will purchase vinyl than CDs. The former format appeals to collectors and remains accessible via mail order. The latter format is more casually purchased and will be neglected in times of shop closures. Trade figures also indicate that the overall market for physical records is paltry. Vinyl accounts for four per cent of the American market. Streaming, on the other hand, accounts for 85 per cent.

Yet the figures are still remarkable. Vinyl looked on course for obliteration twenty years ago; it is now firmly established as a recording format that both consumers and the recording industry will invest in. Pressing plants have struggled to keep up with demand. Equally impressive is the fact that vinyl sales have continued to increase despite the strictures of Covid-19. In the United States they are up four per cent year-on-year. In the UK the trade magazine Music Week has reported that vinyl has defied ‘coronavirus chaos to post big rises’. Sales for the third quarter were up 41.4 per cent on 2019. This is largely due to the rescheduling of Record Store Day, but is demonstrative of the public’s commitment to this format.

After fifteen years of sales increases and a resolute performance in the face of coronavirus we should probably stop talking of vinyl’s revival. Instead, our focus should be elsewhere. The compact disc has been defeated. Will it now become an object of fetishism for collectors?

 

 

Measuring the Measuring

In late 2017, UK Music published their latest Measuring Music report. UK Music is a lobbying group for the ‘collective interests of the recorded, published and live arms of the British music industry’. Measuring Music is one of their campaigning documents and it therefore contains headline-grabbing statistics. One of the most eye-catching is that live music is worth £1bn to the UK economy, while recorded music is only worth £640m.

            This phenomenon has been reported in turn by media institutions, such as the BBC and the Financial Times, and by industry players, such the Music Publishers Association, Ticketing Business News and Billboard. It is also noted in the recent UK Live Music Census.

            What these news reports miss out, however, is that that the live music statistics and recorded music statistics are not directly comparable. UK Music admit as much in their separate ‘methodology’ document, albeit only in terms of their calculation of the Gross Value Added (GVA) Contribution, the figures that illustrate the contribution of each music industry sector to the British economy. UK Music state that GVA ‘is most simply understood as the value of sales minus the cost of bought in goods and services used up in the production process’, but also admit that calculating GVA is not straightforward at all. As a result, ‘This means that it is likely that the ratio of GVA to Gross Output that we apply may vary between the different elements of the core music industry. It is bespoke to the core as a whole, not to the component parts of the core’.

            GVA is nevertheless only one of the factors that help to make any direct comparisons between live and recorded music questionable. In fact, the figures are more profoundly skewed by other elements of the methodology, notably decisions about what makes up the ‘core music industry’ and what makes up the ‘wider music industry’; about what to include within each sector of the music industries; and about what to exclude from these sectors. Recorded music suffers in comparison to live music in each of these methodological respects.

            ‘Core music industry’ occupations are counted towards the trade figures; ‘wider music industry’ occupations are not. The core includes live industry revenue from ‘ticketing agents’ and ‘concert venues and arenas’, but it does not include recording industry income from ‘music retail (shops)’, ‘music retail (digital)’ or ‘other music-based digital services for consumers’.

            This discrepancy becomes more apparent when we look at what is included within the ‘recorded music’ sector and what is included within ‘live music’. Recorded music is restricted to the wholesale income of sales of physical formats and downloads, as well as the money that record companies make from streaming (of both the ad-supported and subscription varieties). It does not include the money that the retailers and streaming companies make from selling these goods. The Live music figures, meanwhile, include ‘Total ticket sales for all kinds of live music events’. In contrast to recorded music, they feature the share of income that goes to the retailers of the tickets: ticketing Agents are included. This makes a significant difference. If the retail income from recorded music were included, its totals would rise by at least 30% in the case of the streaming and downloading trade and by around 40% in respect of physical sales. Conversely, ticket agents earn about 10% of the income from ticket sales. On top of this, the live music figures include ‘food and beverage sales’, ‘merchandise’ and ‘venue parking’, as well as ‘camping fees’ for music festivals. It could be argued that recorded music generates similar ‘ancillary’ income (record shops generate merchandise sales and many also now sell food and drink), but these are not included in the figures. The list of trades included under live music is also more expansive. The figures incorporate music festival organisers, music promoters, music agents and production services. Recorded music does include ‘design and production of physical product and packaging’ alongside those employed by record labels themselves. Nevertheless, it does not include the money generated by ‘music producers, recording studios and staff’. These could be considered intimately connected to recorded music, but they are given a separate section within the Measuring Music report.

            There is a more significant omission, however. The live and recorded music figures are concentrated upon those who make a living because of the work of musicians and composers: the record companies, manufacturers, ticket agents and venue workers. The income of the musicians and singers is not included under the headings of recording or live. The policy, instead, is to subtract artist income from these totals and to place it in the combined field of ‘musicians, composers, songwriters & lyricists’. This makes a difference in three respects. In the first instance, it enables the Measuring Music report to argue that artists are the biggest income generators of all. Their total GVA contribution is calculated at £2b. This is double the live income figure and more than three times the amount calculated for recorded music. Secondly, because the figures for composers and performers are combined, we do not get a picture of how much money they are each deriving from recording and how much from live music. This is significant, as we need these figures to get a more accurate picture of the money that is being generated in these two fields. A third factor results from the fact that Measuring Music does not drill down into its figures. We do not get to see how much record companies are earning from recorded music in comparison to recording artists and composers, and nor can we assess the distribution of income in the live music field.

What can be assumed, however, is that the majority of income reported under ‘recorded music’ will result in related income for musicians and composers. They will receive royalties from each sale, download, stream, radio play, public performance or licensing deal. Moreover, while there are variations in the amounts that artists will receive, these are within parameters: approximately 15%-20% of the income from sales and streams will go the recording artists, 8.5% will go the songwriters and their publishers; performing rights relating to the sound recording will be divided 50/50 between record company and musicians, while songwriters will receive at least 50% of the performing rights income for the composition.

            In contrast, there are several income streams reported under ‘live music’ that will not result in corresponding income for performers or composers. In the majority of cases this will include the sales of food and beverages at gigs, the parking income and camping fees, and also the money that venues charge to put on events. Other income figures for live music can be widely variable, including the shares that artists receive from ticket sales and the money that they make from merchandise. The general tendency, however, is that the gap between the rich and poor is wider in live music than it is in recorded music. Live music income is oriented towards star performers and heritage acts, as well as to artists who perform cover versions of these performers songs. Performers down the lower end of the scale may earn nothing from live music or even operate at a loss. Recorded music, in contrast, has a more equal basis. The stars here obviously do make more money than the obscurities, but they do so from generating multiple sales and streams, rather than by charging higher prices than their competitors or by demanding higher fees.

            In one respect UK Music’s decision to separate the income of composers and performers into a category of its own is justified. Although these artists have different income streams for their recorded and live work, the profits and losses in these areas are intertwined. The report depicts a sequential process whereby it is songwriting that enables the creation of successful records, and successful records that prompt successes within live performance. This sequence moves in various directions when it comes to revenue, however. Live performance drives the sale and usage of recordings, and recordings drive the sales of tickets for gigs. Beyond this, as Measuring Music argues, the most successful artists are not just selling their music; they are selling themselves ‘as a brand, reputation or image’.

            At the same time, the categorisations employed by UK Music are of tactical use. As stated above, Measuring Music is a campaigning report. It seeks to gain the government’s support for the UK music industry as a whole. In doing so, it has a dual task. One objective is to point out the value of music. Therefore, the report documents the vast amounts of money that are being accumulated and the large numbers of people who are being employed. At the same time, the report calls for aid. It wants the government to intervene so that yet more money can be made and so that jobs in each sector can be secured.

            UK Music is a coalition between record labels, publishers, artists, managers, songwriters, collection societies and the live music industry. It aims to promote a unified front. It does not want to identify injustices amongst these industry sectors. Therefore, despite the widespread criticism of streaming royalty rates for musicians and songwriters, this report will not show you whether record companies and publishers are profiting at their artists’ expense. Similarly, while prices for tickets have risen sharply in recent years, Measuring Music provides no clues as to whether the live music industry could be more altruistic towards smaller venues or to nascent performers.

Instead, it locates responsibility for low rates of pay outside of the core music industry. As with virtually all industry documents from last year, its main beef is with the ‘value gap’: if there is unfairness in music it is due to YouTube and Facebook and their pesky ‘safe harbours’. Michael Dugher, the CEO of UK Music, stresses that ‘these platforms offer little adequate reward to the investors and creators of the “content”. As a result, their safe harbours must be removed.

The report also suggests that the closure of this value gap within the recording industry will help all parts of the music economy. In doing so, it absolves the live music sector from any responsibility for the distribution of its riches. Dugher notes:

Live music did have another great year as millions of people poured into festivals, stadiums and venues to see and hear their favourite acts. And live music is a fantastic driver for growth. But future talent will never get the chance to shine if we continue to see cuts in music in schools and closures in venues where artists need to learn their craft in the first place. To reach the big stage you need to have a hit record and you need to be able to pay the bills. That means that those who create music and invest in it must be properly rewarded. That’s why we must urgently address the ‘value gap’, particularly on the new and exciting platforms that many people now use to listen to music.

This would appear to indicate that, despite the headline figures about live music’s dominance, when it comes to artists’ recompense it is recorded music that is primary.

Vinyl: A History of 2014

I’ve been slow at offering a report on vinyl sales for 2014. There’s a good reason for this: there were plenty of others willing to get there first. Stories about vinyl are now mainstream, just as the product is itself. The vinyl market is no longer niche; it is an established part of the music economy. In 2014 vinyl album sales in the UK topped a million. They were 65.1% up on the previous year, eventually selling at 1.29m units. According to PIAS, one of the UK’s main distributors of physical formats, vinyl now makes up 20% of their market. Meanwhile, in the US, 9.2 million vinyl albums were sold last year. This represented a 52% increase on 2013. More significantly, these albums accounted for more than 6% of all physical album sales.

            What needs to be borne in mind is that vinyl albums are expensive. They can make people money. Edwin Schroter, managing director of PIAS, has acknowledged that ‘at the higher dealer price this is good business to be had’. He also attributes the rise in the number of independent record shops to the growth in vinyl sales.

            This type of success doesn’t go unnoticed. In last year’s annual report, I noted that independent record labels were disproportionately successful within the vinyl market, accounting for nearly 60% of the trade. The majors are now raising their game. 2014’s Record Store Day was underscored by complaints that some indie labels couldn’t get their product pressed up for it on time. The shelves were instead filled with titles from the major’s stars, among them One Direction and Herbert von Karajan. This activity led to complaints from indie distributors that the day had been ‘appropriated by major labels’.

            The major record labels went on to dominate vinyl’s top 10 as well. In 2014, all but two of the top ten were on majors. Number one was Pink Floyd’s The Endless River. This was in contrast to 2013, when indie labels released all but three of the best-selling vinyl albums.

            Music Week published 2014’s sales figures on 9 January 2015. In the same edition of the journal there was an interview with Tony Wadsworth, marking the end of his tenure as chairman of BPI. Prior to looking after the UK record industry’s trade body, Wadsworth spent 26 years with EMI, where he rose to the position of CEO. This pillar of the UK music establishment has marked his semi-retirement by joining the indie record retailer Sister Ray, with whom he has set up a vinyl-only branch of the shop. In undertaking this move Wadsworth has indicated that he was in it for the love of music all along. He’s also provided further evidence that there is good business to be had. 

R4949 Starr

I’ve had a couple books on the go recently and they’ve both had something to say about the status and economic worth of vinyl records. First, there’s The History of Live Music in Britain, Volume 1: 1950-1967, a brilliant collaborative venture between Simon Frith, Matt Brennan, Martin Cloonan and Emma Webster. The book seeks to redress the balance of most accounts of the music industry, which, as the authors rightly point out, ‘over-privilege the recording sector at the expense of the sector in which most musicians in all genres have been located historically: the live arena’.

In the period that this first volume covers even the most well known musicians made more money from touring than they did from recording. The authors quote Gordon Thompson, who states that in the mid-1960s ‘recording contracts provided so little money that a band such as Herman’s Hermits needed to tour because most of their income came from live performance’.

            As so often, what was true of Herman’s Hermits was also true of the Beatles. The second book I’ve been reading is another opening volume: Mark Lewisohn’s Tune In, the first part of his trilogy of books covering the Beatles’ history. The book is unusually forthcoming about recording contracts. It reveals just how little the Beatles stood to earn from their record sales. Lewisohn writes:

the everyday business of management was the stage. No ‘pop stars’ could live off broadcasting fees and only the very biggest of chart stars could live off record royalties, so miniscule were the percentages. No one even tried. The sole object of making records was to attract a bigger profile and so earn higher fees from concert and ballroom shows – and, if the artists were lucky to be chosen, to appear in summer seasons in seaside resorts.

The Beatles’ initial contract with EMI gave them a royalty rate of one penny for each single sold (taking into account both sides of the record). This was payable on only 85% of sales (the other 15% was kept by the record company in lieu of ‘records returned and/or damaged in transit and/or used for demonstration of advertising purposes’). Albums were calculated proportionally, ‘usually as six or seven singles’. The royalty rate was halved for sales outside Britain. Lewisohn does the maths:

In the Beatles’ case, this penny they’d get on 85 per cent of sales would have to be divided five ways: 15 per cent to Brian [Epstein, for his manager’s commission], the rest split between John, Paul, George and Pete [Best]. If they sold a thousand records, they’d get fifteen bob each, and if they ever managed such a famous, gilded, pinnacle-of-career accomplishment as a million-seller, they’d each get £750. If this happened in America – which was, quite obviously, ludicrously unlikely – it would be £375.

He also has the figures for their first EMI royalty statement, which rewarded the band for the sale of 36,868 copies of ‘Love Me Do’. The total received was £130 11s 6d, out of which the Beatles took just £27 15s each. Lennon and McCartney earned more from their songwriting royalties for the single than they did from their record contract. According to Lewisohn, the ‘mechanicals’ for this volume of sales would bring in £325. After Epstein’s 20% commission on this income, this would give the composers £130 each. However, this songwriting income paled in comparison to the money the band was earning from live performance. At the time of ‘Love Me Do’ the Beatles were commanding £50 for each concert appearance.

            And yet it was not live performance that the band venerated, it was records. Here’s Ringo, recalling the experience of seeing ‘Love Me Do’ pressed up as a 45:

[It was] The most momentous moment – that we had a record out, that we had a bit of plastic with us on it. Just the idea of being on a bit of plastic was really incredible after all those years of playing. My God, a record that you hadn’t made in some booth somewhere . . . you don’t believe how great that was.

Ringo, lest we forget, would earn less from recordings than the other Beatles. He wrote the fewest songs. He’s not alone, though, in lauding the moment of seeing yourself on record for the first time. Here’s Keith Richards, talking about the Rolling Stones and their contemporaries:

In a way, in those days, being able to get into the studio and get an acetate back sort or legitimized you. ‘You’re now a commissioned officer’ instead of being one of the ranks.

If only someone would ask him, I’m sure Peter Noone has a similar quote up his sleeve.

            Reading these books made me think about my own work. In Vinyl I argue that one of the distinguishing features of the analogue disc – from the 1880s to the present day – is that it is very difficult to manufacture copies within your own home. This is a format for professionals. As Keith Richards says, it legitimizes you, and it does so in a way that live performance can never do.

            Thus far Ringo and Richards back up my claims. I have paused for thought, however. In the fourth chapter of Vinyl I write about the desire of musicians to escape the commodification process, focusing in particular on the the negative comments rock musicians have made regarding the transformation of their art into serially produced consumer goods. However, it is clear that most musicians (myself included) loved the experience of being pressed into a record for the first time. Consequently, I would now temper my analysis in two ways. Firstly, mass manufacture is not always spurned. There are many artists (and consumers) who place their faith in the most multiplied of products. Jimi Hendrix was amongst them (at least when it came to guitars). According to Charles Shaar Murray:

he seldom bothered with special left-hand models, both because right-handed guitars were more plentiful and easier to obtain, and because – with a touchingly American faith in mass-production – he believed that they were likely to be manufactured to a higher standard.

This depiction of the performer as consumer leads me to the second aspect that I would now change. In the chapter I make a crude distinction between artists and audiences. In doing so, I draw upon the work of Jon Stratton, but I now realise he may have led me up the wrong path. Stratton’s argument is that, in creating a vinyl record

The music is not only commodified; in the process it is also distanced, alienated, from the artist, and becomes an object which is understood to exist in its own right. It moves from the private domain of the artist to the public domain of the market place. Reciprocally, the artist experiences a distancing from his or her music as it becomes product, and is experienced as existing in a different social context. The record company, like a book publisher, acts as a gate-keeper shifting the experienced position of the music from the artist’s individual identification with his/her music to the experiencing of the music as a commodity in the market place.

He suggests that, as this happens, the artists aren’t only distanced from their music; they are distanced from the fans. The musicians stand at one end of a process, their audience is at the other. In between is the apparatus of recordings, gatekeepers and mediation.

He’s clearly right that the music becomes a product and that it exists in a different context. He’s wrong about other things, though. By entering the market place, the music isn’t distanced from the artists: they are consumers too. In fact, one of the reasons why artists are excited about seeing their work on record is because it enters shops in which they have browsed their whole lives. This isn’t alienation; this is coming home.

            What’s interesting to note, though, is that artists’ excitement about the commodity form always seems to come in relation to their first record releases. In the Beatles’ case they each knew by heart the R4949 catalogue number of ‘Love Me Do’. It had become etched into their memories as they had gazed at the record label for so long. And yet, once they had a few releases under their belts, the band members struggled to remember in which order those records were issued or which songs each album contained. Maybe the point at which pop stars become alienated is not when their music is turned into product, but when they stop hanging out in the market.

Record Collecting 1: Articulation

I’m continuing to think about Record Store Day and why it appears to have upset more people this year. In my previous blog entry I focused on the corporatisation of the event, but other themes couldn’t help creeping in - articulation, structuralism, cup cakes. What much of it comes down to, I feel, is the changing nature of record collecting. There is a distinction between being a record collector (which was the old way of viewing of things) and being ‘into vinyl’ (which is perhaps taking over). There is also a question of just what it is that we’re collecting when we collect records: is it music, is it a format, and in what ways is it a bit of both?

Across a few blog entries I’m going to propose some different ways of looking at record collecting. I want to start by looking again at articulation and by trying to unpack the complex statement made by Spencer Hickman, the organiser of Record Store Day in the UK. He raised the following complaint about this year’s event: ‘It now feels like it’s not celebrating the culture of the record store and why they’re so good; it’s about the releases’.

            It’s hard to get to the bottom of this. Hickman could be arguing that record stores are about more than the music they sell. They are also hubs for people to get together; they offer a community service. He could be suggesting that not all of this year’s Record Store Day releases contained appropriate music. They are luring in One Direction and Herbert von Karajan fans, whereas an independent record store should be the preserve of Butthole Surfers and Gaye Bykers on Acid. He could be suggesting that records have a life of their own. As well as being the bearers of music, they are objects in their own right. This year’s Record Store Day could have attracted people who are interested in vinyl per se, rather than caring about the music it contains. 

            This duality of the analogue record has been a long-standing interest of mine. Vinyl: A History of the Analogue Record is, in part, an attempt to analyze the relationship between the format and its music. This is the reason why I co-opted Stuart Hall’s theory of articulation. Hall stressed two uses of the word ‘articulate’: it can mean to speak forth and it can mean to join two items together. He argued, ‘An articulation is thus the form of connection that can make a unity of two different elements, under certain conditions’. For Hall, this unity has to be forged and it has to be argued for.

            This is what the indie community did with the vinyl record. They wished to unify this format with their own musical and economic cause. They did so in a structuralist manner. In his theory of linguistics, Ferdinand de Saussure argues that ‘signs’ gain their meanings from their contrasts with other signs. For indie record labels and musicians the vinyl record was a sign, one that gained its meaning because it was everything that the compact disc was not. Vinyl was (or became through their agency) organic, hand-crafted, lo-fi, DIY. The format articulated the music and the music articulated the format.

            Hall argues that articulations can become disengaged and that different connections can be made. My previous blog entry was an attempt to look at some of the newer vinyl articulations that this year’s Record Store Day highlighted. Whereas indie record labels utilized the format to provide contrasts with the CD, independent record shops are advocating the format because of the alternatives it provides to the MP3. This is the whole ethos of Record Store Day: to encourage physical punters to buy physical records.

            As I stated, there is a potential danger in this. Record Store Day is perhaps too strongly focused on vinyl, rather than on music. In fact, it celebrates the way in which analogue records can restrict access to sound. Spencer Hickman has discovered that the effects of this are pernicious. In the first instance, the focus on records rather than music has allowed some unwelcome genres and record labels to enter the shops. Secondly, it has opened the shop doors to a group of punters who might be articulating the vinyl record in a different manner to either independent record labels or independent record stores.

            This is where I raised the spectre of the cup cake. It is possible that there is a new breed of vinyl collectors who articulate the format as a ‘kitsch frippery’. They like it because it represents quaint, old-fashioned values. If this really is the case, then it’s not surprising that Hickman is worried about the records taking over the stores.