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Michael considered fate at 15:33   |   Permalink   |   Post a Comment
Well, according to the trusty 'ol Associated Press (@Wired):
Worldwide sales of music over the internet and on mobile phones hit $1.1 billion last year, triple 2004 sales and accounting for 6 percent of global record company revenues, the industry said.
6% may not be much in the big scheme of things but $1.1 billion is a pretty large number. Somewhere along the line, probably back in those heady days of the industrialized revolution, discussions pertaining to large amounts of money quietly transistioned from using small teeny tiny words such as "millions" and began using the larger (though perhaps less mature) cousin "billions". Nowadays we bandy about "trillion" on occassion too. In fact, the world GDP is roughly $55 trillion as measured in international dollars. That's a lot, if you weren't sure, but nevertheless it's only $8500 per person on this earth which is sort of humbling in a way when I do the finger-counting math and notice how little time it takes me to accumulate that sort of wealth.. In fact it's sort of humbling when you realize you have to call $8500 wealth. In the United States of America we call that below the poverty line but we try our best not to think about it because the truth is that most Americans believe that between 1 and 5 million people live in poverty in the United States when the actual number is nearly 33 million.

But back to what's important.. Like the $18 billion recording industry. Like the 420 million individual songs that were legally purchased and downloaded off the internet last year. Like the three-fold increase in online music sales over a single year for the industry - the same industry that is complaining that, if left unchecked, the wilds of the internet will destroy their way of life, will erode away their life's work, will leave them destitute and in the gutter; surely no doubt, below the poverty line.


In these times of major label mergers, splits, re-shufflings, and enormous changes in the technology they must deal with and submit to -
.. you know, CDs that don't last more than a few years so you have to re-buy them, cheaper manufacturing costs, online delivery systems with practically no overhead compared to traditional channels.. it's tough being a recording company..
- these poor companies have even bigger problems to deal with: Their inability to reign in the astronomical spending in the upper tiers of management! The Financial Times has reported that Warner Music paid it's top 5 execs over $21 million in salary and bonuses after last year's $2.6 billion acquisition of the US music group by a private equity consortium. The article states that of the top management, the chairman who led the buy-out, Edgar Bronfman Jr was paid $1 million in salary and $5.25 million in bonuses. The head of Warner's international operations, Paul Rene Albertini, was given over $1 million in salary and they threw in a $3 million bonus. In fact, according to documents filed with the U.S. Securities and Exchange Commission, the total executive payouts from last year were over three times higher than Warner Music's $7 million operating income for the 10 months up to the end of Sept.

Poverty indeed.

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