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How We Know That the Compact Disc Is Dead


14 June 2007

The compact disc (CD) is dying. It is on life support and only propped up by legacy playback devices. The music industry does not want to support the compact disc, but is in the unenviable position of having to. There’s no copy-protection available for the manufacturing standard of CDs, so the industry is forced into selling massive amounts of copyable discs even while it peddles digital rights management on MP3s. And yet apparently some people still haven’t gotten the memo.

Yes, CDs comprise the bulk of music sales both in dollar amount and unit volume. But as everyone knows, those amounts are both in decline at the hands of digital files (and let’s not even get into the numbers of files that are transferred on P2P networks, which eradicates the compact disc entirely.) New generations of music consumers (the market’s most important, lucrative sector) only use compact discs when they are absolutely forced to, and truth be told, that usage is miniscule. If you think that compact discs have a future or are not on the verge of elimination, you probably still sing the praises of vinyl LPs and analog TVs. Compact discs will indeed be manufactured for probably five or more years, but they are already relics.

If you want to ignore the sales figures and obvious cultural upheaval, you could be convinced by the amount of investment in compact disc technology and manufacturing over the past several years. There’s virtually no R&D money devoted to the compact disc, manufacturing facilities (hah) are suffering the laws of supply and demand, and there’s virtually no one who wants to throw money at the technology any more. The bottom line is that if no one wants to be in the business and everyone is betting against it, how can it survive? It obviously can’t, which is why there are already people calling Christmas 2007 as the last holiday season for compact discs.

Sales are diving, manufacturing is retreating, consumers vastly prefer other products, it doesn’t serve niche markets well, and its lack of flexibility is helping to push the compact disc into antiquity. The compact disc is dead because there are no signs that it is alive.

Filed under music industry music technology

Comments

I agree with most of what you wrote below, but why the need to slam vinyl? I have an iPod and a large iTunes library and still own and listen to my records (as well as CDs)!


Matt Berlyant    2007-06-15 16:34    #

The cd is far from dead. Look at jazz. Blue Note has been issuing RVG remasters of their classic catalog every couple of months for about 8 years now and show no signs of slowing down. It must be somewhat profitable, because Concord recently began issuing RVG remasters of their jazz catalog. I see Lee Morgan’s Sidewinder is in the top 5000 on Amazon, which is impressive considering…
a) the album is 43 years old,
b) it’s not very well known outside of jazz circles,
c) it was reissued in 1999, so the initial buying rush died off a long time ago, and
d) jazz only accounts for about 3% of album sales.

Basically we have a relatively tiny number of jazz lovers driving a cottage industry of jazz reissues. Now extrapolate those numbers to rock, and you’ve got a format that will probably be around for a long time. Most real music lovers are not content gazing at their music collection on their iPods or PC monitors. They want something to hold and look at. As long as those people exist, the music industry will have a product to sell them. The only question is where the product will be sold.


— Matt    2007-06-16 00:12    #

Dead? Have you been taking hyperbole with your coffee? Yes, the CD’s market share is declining. Baseball’s market share declined too, but just because it’s not as popular as football doesn’t mean it’s dead. Even the cassette tape is not dead. Dead applies to the 8-track tape and the 78 RPM record. Anything that’s still sold, still manufactured, is by definition not dead. Consumers just have more format choices now.


— Steve Holtje    2007-06-16 11:33    #

I work in the publishing industry and I remember the end of the printed book being predicted in 1999 with the advent of e-books. The printed book is still nowhere near dead 8 years later, although it is nearing extinction in certain segments of the market (i.e.- reference). I don’t doubt that CDs may someday join 8-track tapes, but I don’t know that it will happen that quickly.


— Joe Romano    2007-06-19 13:22    #

The CD isn’t “dead” in the literal sense—they still manufacture buggy whips and carriages too. But it’s going by the wayside quickly. Yes, vinyl is still manufactured and incidentally, so are cassette tapes. Some of us listen to all these formats and possibly always will. The predictions of printed books were largely that and not based on an obvious transition to another format.

The compact disc is facing an incredible competitive battle right now. Unlike vinyl or even cassette (and yeah, 8-tracks), the compact disc is being widely accepted as a transfer device. Unlike vinyl or taped media, it’s already digital and thus there is very little conversion hassle. Factor in that MP3 players are more portable, easier to use, and cheaper than vinyl or cassette tapes, and the future is obvious.

What’s more, the labels want to move to digital files because a) it’s easy to attach DRM and b) it lowers manufacturing/distribution costs. They have to support the CD because it’s 80% of sales, but the reality is that they are all very excited to move away from the CD.

So, all that’s left is the consumer. Legacy playback (largely the CD) is relevant but anyone who is younger than 10 years of age will most likely grow up without ever purchasing a CD. Why? They won’t need to. It will be cheaper and easier to get music and listen to it through other avenues.


— john Davidson    2007-06-19 15:35    #

Cassettes were never widely used as a transfer device? That’s news to me. I thought home taping was killing the music industry. Oh wait, that was 20 years ago.

In theory, your points are correct. In practice, you’re all wet. I used to work in the banking industry. Ten years ago, the experts were predicting mass closures and reductions of bank branches due to the proliferation of ATMs and online banking. Not only were the experts wrong, they could not have been more wrong: retail bank branches have only gone up in recent years.

In the case of the CD, you contradicted your own argument by bringing up DRM. Supply does not drive the music industry, demand does. Consumers will continue to buy CDs as long as labels continue to attach DRM to digital music. And let’s also not forget that CDs are more durable than vinyl or cassette (or your hard drive).


— Matt    2007-06-19 18:20    #

‘In the case of the CD, you contradicted your own argument by bringing up DRM.’

Apple has begun releasing tracks with no DRM and at a really good bit rate, eMusic does the same. I am a hardy audiophile, and I am finally beginning to feel satisfied.

I remember how vehemently people resisted CDs initially, for many reasons. I think freeing music from physical media is good thing overall-there will always likely be a way to use the digital information, be it from a CD, iTunes, or what have you. I think movies are headed in the same direction; physical delivery is for better or worse at the end of it’s days (at least in an itemized sense-the hard drive is a physical device after all).

I don’t understand the mishigas. It isn’t as though music itself is evaporating! I feel that we are simply seeing the result of a shift of culture, pop or otherwise, to new modes of delivery and even expression-it doesn’t mean the end of wonderful art! I imagine that what should be of real concern in the current atmosphere in our lives and those of ‘The Kids’ is whether or not we will continue to actively cultivate and make space for an appreciation of it. From what I see all over the internet and overhear the children in my life discussing, I would say that situation isn’t as critical as one would be led to believe.

By the by, I still have music in nearly every format as well.


— Jamie    2007-06-19 23:05    #

i just hope the cd dies before i run out of space. hehe


— insatiable satch    2007-06-20 21:14    #

honestly, i don’t think physical media is on it’s way out. i think things like this will be stepping up as they develop it into a more attractive and buyable format.


anna    2007-06-25 11:50    #

Oh, it’s dead. WalMart downsized the # of Music SKU’s by 20% this year in favor of more space for iPod gear. All of the major chains are on life support and hemorrhaging money. Many indie stores are shutting down and a scant few survive.

For some genres it will take a bit longer. In Oldies, maybe jazz and classical the CD will remain a niche item for the old folks and audiophiles.

I’d bet if you look at consumption by genre, you’d find higher digital conversion in the areas of indie/ punk/ emo than in Country. I bet the next My Chemical Romance could come out via digital only and do just fine.

The real collectors and fans would have to buy the limited box set for $50.


bill    2007-07-02 20:24    #

I just hope that they give us lossless files, then. MP3s suck.


— Bill    2007-07-04 11:58    #

Personally, I think the record companies are screwed. The CD is dying and is still their biggest seller. The next group of people growing up are doing so without needing a physical object for their music and worst of all, have many places where they can get it for nothing.

I would actually be really interested to see the average age of people that have purchased 10+ albums off of itunes to see if it is mainly kids or adults use to paying for music.


— Nick    2007-07-07 17:12    #

In the latest issue Jack did an excellent editorial on how the “album” format is now slowly disappearing, so check it out. These days I find myself transferring my CDs to my iPod and listening to music in the shuffle mode a lot more than popping a CD in the player. Now, do I believe in getting rid of my CD collection? No!

The racks at the local used CD shop are filled with product that people sold off since they put their collections on a computer or MP3 device, however there are some major warnings I have on that practice. If you lose the computer or the MP3 device or they go dead then you are without your collection for good.

Right now my CD collection is my backup, my source for higher quality sound and my information source via the booklets. When internet sources start selling music at a higher bit rate thus better sounding MP3s, iTunes is now doing this in a limited way, look out brick and mortar retail as the final nail will be hammered in. The problem still is a reliable storage of music that can’t disappear in a heartbeat so my collection of silver disc remains in place.


— Steve Witte    2007-07-09 10:21    #

One of the points presented was that kids today will never buy a CD because they just download the music they want, legally or otherwise. However, kids have always viewed music as disposable. Ten years ago, kids bought truckloads of Britney Spears CDs. 30 years ago, kids bought truckloads of Shaun Cassidy 45s. 40 years ago, kids bought truckloads of Monkees albums. Most of these are probably sitting in a landfill now.

Most teenagers do not keep the music that they buy/acquire forever. How many albums do you still own/listen to from when you were 16? The people who buy music as a durable good are adults and collector geeks like us. So while there may in fact be some kids who go thru life without buying a CD, that hardly spells death for the CD format.


— Matt    2007-07-10 13:47    #