The record labels and music news sites that benefit from reporting positive articles about the labels, talk about the billions of dollars the music industry made in the financial year just before Napster hit.
So from a simple viewpoint, when Napster hit, sales of music started to decline. For the RIAA and the record labels, these two events correlate, so it implies that one is causing the other to move. But the sales of music had been falling for some time.
What happened during the 90’s just before Napster went worldwide was a lot of re-purchasing.
People started to re-purchase the music they already owned on vinyl and cassettes on CD’s. These re-purchased items, in most cases re-mastered or super deluxe editions with bonus content at higher prices would skew the record label figures to make it look like new recorded music was bringing in billions of dollars when in fact it was people purchasing old catalogue items. And once we had those albums on CD, we didn’t really need to re-purchase them again.
But Napster also highlighted a gap in the business models of the labels. People liked to have access. If anything, people liked to have terabytes of culture saved on disk drives.
Some artists maintain that it was the right action to go after Napster. Others can’t wait for Spotify to die. They must think that people would just go out and buy their albums on physical again. The hard core always will but the majority won’t. They’ll revert to downloading.
The Napster gap allowed people to share their music collections (bootlegs and original recordings) in a very simple and convenient way. Napster got popular because of it, and the labels should have created something to match it.
But the labels did nothing, and more sharing applications kept coming. Then a small company called YouTube did fill the gap that Napster was really servicing. YouTube allowed people to upload their music collections. And YouTube today, generates billions of dollars. These billions could have been in the profit and loss statements of the record labels but they messed up.
We are 22 years post Napster, and the record labels did absolutely nothing to counter it, except scream for legislation and gestapo like police powers.
You want to know who is the labels biggest client. Spotify and the other streaming services.
You want to know who artists see as their biggest enemy. Spotify, but not the other streaming services..
The arrival of YouTube and eventually streaming services put a dent into the traditional sales model, but did these sharing and access platforms assist in increasing the crowds for artists?
Iron Maiden came back with Bruce Dickinson on “Brave New World”, bigger than ever and played to sold out crowds in countries they’ve hardly sold any recorded product in. Even the album “Brave New World” did nothing sales wise.
Twisted Sister and Motley Crue also came back bigger than ever post Napster and played to their biggest ever crowds until they retired. Then again Motley Crue just faked their retirement.
Did sharing of music assist in these high concert attendances as well?
To use the record label analogy of post Napster sales and pre Napster sales, these two events correlate, so it implies that one is causing the other to move. The same can be said about music being shared illegally and bands playing to their largest audiences ever. One event is causing the other to move.
And here we are in 2020 with a pandemic killing off the live show and no one really knowing how it will look once it is over. And the record labels are winning, making money from streaming revenue while the hard rock artists who have a presence want streaming to die.
But it’s the labels with the greatest share of the streaming revenue.