|Burn, Baby, Burn|
|Key Words||strategy, CD burner, MP3|
In the 1980s, the music industry was faced with a problem: customers were making copies of music on cassette tapes and not buying records. The CD changed all that, and the industry enjoyed a 15-year-long sales boom. Now, for the first time in history, CD sales are dropping globally. Worldwide sales of music dropped 6.5% last year.
Consumers spent $1.6 billion last year on CD burners, blank CDs, and digital-audio players. They would much rather create their own collection of songs than buy a CD with one or two tracks they like. In response, the Big Five music companies are pushing controversial anticopying technology into the marketplace. These copy-protected CDs come with problems: they can crash computers, and they may not work in all car stereos or portable CD-players. To make matters worse, some companies are releasing these CDs without warning labels, feeding the fear that any purchased CD could crash a computer.
The companies that are embracing CD burner technology seem to have the more consumer-friendly strategy, and may reap the rewards in the end. Apple Computer and Gateway are both pushing CD burners. A company called StreamCast Networks has come up with an innovative strategy that allows the artists to sell their music via a website without the music label middleman, and for greater profit. Rap Singer Chuck D also has a website that is a source for MP3 files of 4,000 rap artists.
In contrast, the online strategies offered by the music labels have not been successful. They are too limited and too expensive.
|Source||Chris Taylor, "Burn, Baby, Burn," Time, May 20, 2002.|
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