The State of Internet Music on YouTube, Pandora, iTunes, and Facebook [Data]

\” The music business historically has been built around albums. This album-centrism is like saying the sun revolves around the Earth. We don\’t hearken to albums now; we take heed to collections of songs.\”

\” More individuals are engaged with music than ever before,\” said Tom Silverman, chairman and CEO of Tommy Boy Records. \” It\’s a hockey stick going up; it\’s an implausible opportunity that up to now has eluded us.\” Silverman was speaking this morning at the New Music Seminar in Manhattan City, where he and Eric Garland, CEO of huge Champagne (who also unveiled the Ultimate Chart today), gave a State of the Music Industry address. Even though you aren\’t a player within the industry and only an avid music listener, the figures that Silverman and Garland culled would definitely surprise you. Listed below are a number of of their key findings.

A shift from albums to singles

Of the some 100,000 albums released last year, 17,000 of them sold just one copy; more than 81,000 albums sold under 100 copies. Genuinely, just 1,300 albums sold over 10,000 copies, an astonishing figure for the reason that these numbers combine physical and digital album sales. And for physical sales alone? Only 2% of recent albums on Soundscan sold over 5,000 copies-that\’s a skydiver\’s plummet from the golden era of the music industry.

\” The music business historically has been built around albums,\” explained Silverman. \” This album-centrism is like saying the sun revolves around the Earth. We don\’t hearken to albums now; we take heed to collections of songs.\”

Of course, the rationale for significant single-growth and slowed-album sales is due partially to iTunes hawking every song as a single for 99 cents. \” Historically, the worth of an album was five times greater than a single,\” said Silverman, who believes setting the value at a tenth of an album\’s cost was a mistake and that even $1.29 is just too low. \” It is going to\’ve been a $1.99, and then we’d\’ve seen higher digital album sales because it is going to\’ve been an even bigger discount for purchasing an album.\” But both Silverman and Garland agreed that it really is changing, citing the indisputable fact that about 14% of all of Universal Music\’s digital sales are for complete albums, which implies that the $9.99 price-tag is becoming approachable for consumers.

Facebook, Myspace, and Twitter: Track your FFF number

According to Garland, industry folks today are enthusiastic about \” FFF numbers\” -that’s, an artist\’s friends, fans, and followers. \” It\’s a race, but to what end?\” he wondered. Garland showed through a chain of charts how Twitter and especially Facebook are ballooning in popularity for artists like Lady Gaga, while once popular Myspace\’s numbers are stymied.

However, Garland points out that Facebook recently forced most users into converting their profile favorites into \” fan\” data, which arbitrarily inflated the social network\’s numbers. As an instance, Garland tells the story of ways when Susan Boyle\’s performance first blew up, a pal of his added the YouTube star to his Facebook profile. When Facebook imported this knowledge though, he instantly became a \” fan\” of Susan Boyle. \” [He] had little interest in it-[he] liked her for like 30 seconds, once!\” Garland relates. \” It doesn\’t really indicate any consumer activity-it\’s automated,\” added Silverman.

Garland\’s story serves as a trademark of just how difficult it truly is to determine the influence of an artist through his or her FFF number. In spite of everything, in spite of the fact that Lady Gaga starts losing friends on Myspace, that\’s less of a demonstration of her popularity, and more a sign of Myspace\’s falling use.

Google and YouTube more important than iTunes?

Interestingly, it wasn\’t Apple that Garland viewed as an important name in music, although the company\’s iPods, iPhones, and iTunes indicate otherwise. \” YouTube is increasingly the category killer,\” argued Garland. \” When people question me what is the most important name in music individually, they wish me to assert Apple. I usually answer: YouTube.\”

Garland told audiences that once you actually look to where persons are listening to music-not even just watching videos-consumers are turning progressively more to YouTube, which he calls the \” largest catalog of on-demand music on the net.\” If only Google could make this service profitable, right?

Internet radio: Pandora

Garland and Silverman noted that Pandora is now the preferred Internet radio service, with a 52% market share, on the brink of 60 million registered users, and more than 1 billion stations.

And in a sign of just how much the net has impacted music, Silverman told the group that Pandora now represents 1.7% of all radio listening-really a surprising figure to think of. Obviously, traditional music media is going away. But is the music industry ready for the change?

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This post is tagged: facebook, Internet, iTunes, Music, pandora, state, youtube, [Data]