Music Executive Declares ‘CD Is Dead’, Announces Plans To Save The CD

It takes a true visionary to stand up to his industry and speak unpopular truths.
That’s exactly what EMI CEO Alain Levy did last Friday when he told an audience at the London Business School that, in his opinion, the CD format is dead. The audience gasped, the media ran banner headlines lamenting the passing of the once popular audio format, music lovers shrugged and loaded more songs onto their iPods.

There’s just one problem with this story. Levy didn’t really say that he thinks the CD format is dead. If you read his remarks closely you’ll see that he actually said “The CD as it is right now is dead”. See the difference? He’s implying that the CD format can be saved. Furthermore, he has a plan:

“We have to be much more innovative in the way we sell physical content. By the beginning of next year, none of our content will come without any additional material.”

Which seems to mean:

1. He thinks bonus tracks are the key to reviving CD sales.
2. Those very same bonus tracks won’t be available through legitimate digital music stores like iTunes.

It’s been a half decade since the introduction of the iPod and the major labels still aren’t prepared to make the transition from physical media to digital formats. Not only are they not prepared, they seem to be in state of total denial.

Here are the problems with Levy’s brilliant plan:

1. Consumers who have become accustomed to digital music formats are not likely to switch back to CDs.
2. More consumers than ever are switching to digital music. As that happens the CD format becomes a nuisance. An unnecessary extra step to getting music onto your portable audio player.
3. Exclusive CD-only bonus tracks are more likely to boost piracy than CD sales. This is exactly the sort of thing that causes otherwise law abiding consumers to rationalize that piracy isn’t so bad. “It’s only a couple of songs, and besides I bought the album on iTunes”.

Instead of spending time and money trying to prop up a dying media format, the labels should be looking for more innovative digital business models. They can start by looking at the competition and stealing some of their best ideas.

Unless, of course, the music industry is completely giving up on the youth market. Which may have been what Levy was getting at when he noted:

“You’re not going to offer your mother-in-law iTunes downloads for Christmas.”

Actually, some people would. It turns out that Mother-in-law’s come in a variety of ages. Apparently that fact didn’t come up in Levy’s market research. Even if mother-in-laws were all too old and feeble to use iTunes (as Levy’s apparently is) it wouldn’t make a lot of sense to base future business decisions on such a narrow demographic.

This is all just another sad example of the fact that even when someone in the music industry seems to “get it”, they don’t really get it.

• EMI Music CEO says the CD is ‘dead’