Looking At the Business of Vinyl
There is nothing that old-school audiophile pundits like better than reverting back to an old format. They did it when the compact disc came out. They swung back to supporting CDs when�DVD-Audio
�came out. If it's old and low-resolution, the audiophile press often will gravitate backwards to the format. It's truly sad, and it's killing off the business.�
The latest argument that the audiophile press and others have been making is that the sales of vinyl are booming and they go on to imply that this somehow indicates that the future of audiophila is bright. Let me be clear: the 60-year-olds, breathing in radon gas while languishing in their somewhat finished basements, with their cables propped up on sawhorses, listening with their heads in vices, are killing the audiophile business. Savvy buyers who shop out of state while "showrooming" at their local audio salons are killing the business. Worship of great gear over great music is killing the audiophile business. Most important, the idea that we don't fuel the supercars known as our high-end audio systems with something more than vinyl, compact discs or, God forbid, ripped MP3 files is killing the audiophile business, but let's get down to some solid software sales numbers that deflower the argument that vinyl is somehow going to save the audiophile hobby.2011 Nielsen Soundscan Sales Numbers
� Vinyl 3.9 million +39%
� Download 103.1 million +19.5%
� Compact Disc 223.5 million -5.7%
� Video Games 9 Billion - 8%
� EA Madden Football 1.4m units/week +10%
� Dark Knight Blu-ray 1.7m units/week
� Call of Duty $1b units/16 days
� Dark Side SACD 800k units
39 percent growth from 2010 to 2011 according the industry standard, Nielsen Soundscan, is nice growth, but as you can see above, the total sales numbers for vinyl are infinitesimally small when compared to any other meaningful format - especially HD formats. If your investment account has $10,000 and it went up to $13,900 in one year, it means that you have a good broker, but you sure as hell aren't rich. Vinyl's sales are as much attributable to Baby Boomers getting access to their retirement accounts for the first time as any other factor. It is true that you can find hipster kids in major cities in America sifting through bins of records at places like�Amoeba Music
,�The Princeton Record Exchange
�or�Bleeker Street Music
, but then again, those discs are used, so they don't show up on the numbers. And even if used sales were tracked, they'd be a tiny sliver of the used sales of the compact disc. Note: in 2011, the compact disc, which sadly is still our so-called HD format of choice, with 400 percent more digital resolution than what Apple will sell you as a download today, outsold vinyl by 231,600,000 records. That's two hundred and thirty-one million, six hundred thousand more albums sold. It's a blowout that vinyl enthusiasts don't want to accept, but it's factually true.Market Share
According to the DEG (Digital Entertainment Group), DVD-Video players have a 91 percent market share in the United States. Blu-ray disc players, including Playstation 3 units, have just over 40 percent market share, which is growing nicely. Personal computers are far higher than 40 percent and tablet growth is booming with over 100,000,000 Apple iPads sold to date. Android tablet sales are booming in the same way.
The future of audiophilia is going to be based on the mainstream consumer availability of music in high-definition, 24-bit, 96 kHz resolution, with options for surround sound, HD video supplemental materials and beyond. In the short term, the low-cost copy-protection and 50 GB capability of Blu-ray represents the easiest way for major labels to sell consumers their music over again. Hollywood movie studios offer blockbuster films in 1080p video with master quality 7.1 surround sound that is (almost) bit for bit the same as you would hear in a 4K Cineplex, yet the ponytail-wearing, know-it-all record executive geniuses who are responsible for the 66 percent loss of domestic market share in the music business in the United States are scared that you are going to steal their music in HD. They should be scared that you won't ever buy a record from them again, because selling another 1,000,000 copies of Kind of Blue or Back in Black doesn't cost squat to remaster and release, as those records have been paid for generations ago.�
Long-term, media or HD content will not come on a silver disc, but right now, let's be honest: downloads offer amazing convenience but piss-poor resolution and quality. If given the choice between hashed-out MP3s and vinyl, I could see why some might chose vinyl. If the example of the Apple iPod taught us anything, it's that mainstream consumers will buy convenience over performance, which is audiophilia's biggest worry going forward. The next generation of audiophiles won't find the second order distortion of vinyl (or tubes) as important as having their entire music collection loaded into their Samsung Galaxy tablets and speaking flawlessly to their audio systems via Bluetooth or some other wireless codex.�
I am sure some people are going to be pissed off, but the facts need to come to light, because too much smoke is being blown up our collective asses about how 39 percent growth reprints a meaningful trend. If vinyl grows 39 percent for the next ten years, it still won't be meaningful compared to an also-dead format, the compact disc. What we need is an audiophile format that is as analogous to the master as possible, whether the format is analog or digital. Two-inch analog master tapes (which none of us have - even those with quarter-inch reel-to-reel decks) can get you really close to the master tape, but the format is unwieldy for a multitude of reasons. Blu-ray, from the digital angle, can deliver the desired resolution to get your audio system playing near-master tape levels of resolution befitting a killer audio rig and that can come from a cheapie player and a HDMI cable. Digital downloads from the likes of HD Tracks and other venues also can fuel your audio race car suitably, but without meaningful integration into platforms like Apple computers, tablets and AppleTV, most audiophile downloads are well-intentioned options that live on their own technological island.
Neil Young gets the importance of music in HD, which was the main reason for the launch of�his Pono music service
. David Chesky, with his HD Tracks, also sees the path to the future. Sadly, Steve Jobs isn't around, as he was reportedly an audiophile with a pretty stout system. Long-term, let's hope that the Tim Cooks of the world figure out that you can resell every record ever made millions and millions of times over again with no pressing costs, no printing costs, no retail middlemen and so on. It's a huge business opportunity, but more important, it's respectful to the art of music.