The death of the music industry?

Here is a chart of music sales by media (CD, digital, etc) for the past 40 years:

What this chart shows is that music sales hit around $15 billion a year at the beginning of the century and have fallen to about $7.5 billion since then.  In addition, digital sales, which in theory should be growing fast, have grown very slowly over the past 5 years.

I spend a lot of time thinking about this trend because it is clear that in the future, a professional musician is going to have to earn their living a different way than they do now.  Regardless of what genre I am in and how people perceive my music, this chart is bigger than me and will affect me.  The same is true for you if you are interested in creating music for a living.

On the other hand, I am not that worried about it.  The free market should correct this, though it may not be in the way we think.  If musicians have no way to earn a living, they will stop creating music.  But people value music and they would rather pay for it in some way than not have it.  So, while the traditional way of selling CDs and downloads may not be a viable way for a musician to earn a living in a few years, there will be other ways to generate revenue.  Some of those ways are already developing.

I was talking to someone recently about the fact that basically all his college music major friends seem to be recording CDs.  That is not too far from the truth, and unfortunately, those people are learning the hard way that the industry trends are not in their favor.  When combined with the fact that there is a glut of music in the market, it is extraordinarily difficult to even pay for the production of a project with CD sales.

I do not believe in quashing dreams.  We need people to take risks and create music in this very tough environment.  But I just want to emphasize that you will not pay for the production of a project with retail sales unless you are very aggressive in marketing.  Typically, there needs to be other ways to generate revenue beyond just CD/download sales.  In short, I would put it this way: don’t do a CD unless you are willing to view your music as a business and/or serious ministry rather than a hobby.  If you dink around, you are going to get burned regardless of the quality of the project.

And can I give just one more bit of advice? Your biggest ministry is at home.  Don’t mortgage your family on the back of your music.  Don’t put financial pressure on your spouse because you borrowed money to record a CD.  If you possibly can, bootstrap you music.  Save money, pay what you can afford, and sleep well at night.  Music careers can absolutely destroy families. 

If you position yourself right based on what I said in the last two paragraphs, I see no reason for pessimism.  There are plenty of opportunities to succeed today and there will be opportunities in the future too.  The music industry is not going to die regardless of what you hear.