Tag Archives: digitalization

CDs are Dead. Long Live the CD!

Originally published by Breaking Modern:

Compact discs are dead. I realized this recently while shopping for a replacement for my dead 25-year-old Sony CD player; where there used to be lots of brands, now there are only a few and where there were many models, fewer still. Of course, this follows years of watching brick-and-mortar music stores — HMV, Tower, Virgin Megastore et al. — close their doors.

Perhaps it would be more precise to say that CDs were murdered. But was that just? Was that right?

Apple, which both predicts and creates the future, thinks streaming is the future — so they’re driving a stake through the heart of those shiny 5-inch discs whose design was supposedly inspired by an episode of Star Trek.

The computer giant recently ceased production of the signature device it introduced in 2001, the 160GB version of the iPod Classic. Says Will Dunn, editor of Stuff:

The iPod’s days have been numbered since the first iPhone, and the subscription model shows no signs of slowing down. Apple itself is transitioning into music subscriptions with iTunes Radio, and Google has just started trialling YouTube Music Key.”

Still, despite the pressure, many consumers prefer to own rather than rent their music.

Here’s Dunn again: “There’s still a huge affection for the iPod Classic and it’s not hard to see why – Spotify might offer 20 million songs, but 120GB of music is more than most people need, and your iTunes library doesn’t carry data charges or a subscription fee. Also, I think the Classic is a more distraction-free listening experience – I’m more likely to get through a full album on one.”

Music geeks have driven up the price of used iPod Classics on eBay and Amazon by hundreds of dollars more than their original cost.

Apple isn’t alone. Auto manufacturers have signaled that new cars will soon come with MP3 players, not CD players, standard.

2014 was a disastrous year for the music industry, with sales of both compact discs and MP3 downloads way down — to historical lows — as streaming gained steam. “Digital track sales are falling at nearly the same rate as CD sales, as music fans are turning to streaming—on iTunes, SoundCloud, Spotify, Pandora, iHeartRadio, and music blogs,” reports Derek Thompson of The Atlantic.

Before you sell all your CDs on eBay, however, you might want to think twice. Compact discs have a number of distinctive advantages over streaming and digital downloads.

CDs Win on Quality

“Steve Jobs was a digital pioneer, but when he went home, he listened to vinyl,” Neil Young noted in 2012. Audiophiles who know the difference say vinyl offers the richest, most textured listening experience. Though vinyl is decidedly superior to compact disc, the CD is better than MP3 as we know it.

Downloads and streams music is highly compressed in order to keep the data flowing and maximum storage space, but that efficiency comes at a cost. “True CD-quality files take up anywhere from three to 10 times as much as space as an MP3 or AAC file, depending on the latter’s bit rate; 24-bit files take up even more space,” according to PC Magazine.

Owning Beats Renting

Digital data is easy to lose. If you don’t believe me, Google “lost my iTunes music library.” Yes, sometimes it’s possible for the poor souls who somehow managed to erase thousands of dollars of music from their devices to restore them. Other times, not so much. Either way, the one thing you can be sure of is that it won’t be painless.

A friend – she was the first person to show me how cool the iPod was – got rid of all of her CDs after ripping them. Then some jerk broke into her apartment and stole both the player and the laptop to which she synced it. Just like that, she became a music pauper.

True, if she had downloaded all her songs from iTunes she could have gotten them back. To me, however, the bigger lesson is, I trust myself more than I trust some company. She should’ve held on to the CDs.

The Physicality of Music Is Rewarding

A woman from England wrote to NPR’s music blog: “When I was a teenager, I saved up to buy music, bought one CD or record at a time, and listened to the crap out of it. I knew all the lyrics, I knew melodies and bass parts, I had different recordings of the same track — all that. Now, I download a heap of music: some albums, some singles, some random tracks that catch my fancy. I listen to them a few times, and then they get lost in the iTunes pit of despair.”
Downloaded MP3s aren’t songs as much as they are items on a list. Stuff you stream on Spotify or Pandora doesn’t even rise to that level; it’s just something that you hear in passing the middle of a bunch of other stuff. Unless a song really stands out, you’re not going to pay close attention. The odds that a tune will grab you enough to learn the lyrics, much less change your life, are radically diminished by the combination of abundance and randomness inherent to post-compact disc formats. 

I recently reorganized my extensive CD collection – aside from being a bit of a music addict, I reviewed records for many years and so have thousands of them – and found myself falling back in love with the physical form of the CD. While the artwork and liner notes in 5-inch booklets pale in comparison with their 12-inch vinyl predecessors, they’re better than nothing – and nothing is what we get when we stream or download. Like it or not, visuals matter.

Albums Force Serendipity

Remember the joy of discovery? On a vinyl album or a compact disc, the listener is “forced” to sit through “lesser” songs that, when they don’t work out so well, are viewed by fans and critics as contract-fulfilling filler. But that’s hardly the case for every band. In the digital age you can always download a single for 99 cents and avoid the dross — but what if the songs that never made it as hit singles for whatever reason turn out to be great? Odds are, you’ll never know. With a CD, you get to experience the full creativity of your favorite musicians as they experiment and stretch free of the constraints that come with trying to score that big hit.

Support Musicians, Not Streamers

Obviously you want the bands and musicians whose work you enjoy to make as much money as possible so that they’ll be motivated to soldier on. Unfortunately, digitalization has hit creative people hard, and musicians are no exception.

It’s pretty clear that, for the average band with a decent sized but not crazy fan base, compact discs are far more lucrative than digital radio and other contemporary formats.

Streaming services like Pandora and Spotify are notoriously parsimonious with artists, and at this point anyone with a conscience really shouldn’t be supporting them.

You Can Sell CDs …

Although the price per song is roughly the same when you compare a 99-cent download to a $14 CD with 13 songs on it, the price differential changes radically when you consider the fact that you can easily sell a used CD. If you have good taste, in fact, you could probably make a pretty good living investing in CDs – I’ve noticed that many of the CDs I bought for $12 way back when are worth $50 or more to collectors.

That’s a better rate than I got on my 401(k).

You could even make a habit of purchasing physical compact discs, ripping them at the highest possible quality to save and sell them. In many cases, you would probably be getting a dozen songs for just a couple of dollars. And then you wouldn’t be stuck with all those discs to store.

Just make sure to keep a backup hidden away in case my friend’s burglar drops by.

SYNDICATED COLUMN: How to Save Books

Why E-Books Need Print to Thrive

Borders and Barnes & Noble killed independent bookstores. Amazon killed Borders. Now Barnes & Noble, which sells more than 20 percent of pulp-and-ink books in the U.S., is under siege.

If B&N collapses: the death of books.

Cultural apocalypse.

Neo-feudalism.

You may remember such classics as “How the Internet Slaughtered Newspapers” and “How Napster Decimated the Music Business.” It’s always the same story: Digitalization destroys profits.

Whether it’s newspapers, magazines, CDs or books (“pBooks,” they call them now), the electronic assault on tangible media follows a familiar pattern.

First: Pricing is set too low; margins get squeezed.

I pay $43 a month to get The New York Times delivered; new digital-only subscribers get the app for $5. In the book biz per-unit net to publishers is actually a few cents higher for e-books. But that margin is deceptive. “If e-book sales start to replace some hardcover sales, the publishers say, they will still have many of the fixed costs associated with print editions, like warehouse space, but they will be spread among fewer print copies,” notes the Times. E-books also eliminate paperback editions, a big second chance for publishers to break into the black.

Second: Piracy runs rampant.

Piracy of print media was virtually unheard of. But digitalization makes piracy tough for even the most honest consumer to resist. It’s easy and it’s fast. E-book knock-offs look and feel exactly the same as the real thing. As of the end of 2011 an estimated 20 percent of all e-books downloaded onto Kindles, Nooks and iPads were pirated. That’s a 20 percent pay cut to authors, agents and publishers—a number that will only go up.

And “legal piratization” is on the horizon. On February 6th a federal court in New York City ruled that ReDigi, an online marketplace for “pre-owned” MP3 files, can continue to operate pending the outcome of a lawsuit by Capitol Records. And public libraries are already “lending” e-books to multiple “borrowers” with the click of a mouse—the same process as buying them. But free.

Third: à la carte sales whittle down revenues.

Twenty years ago if you liked a song you heard on the radio you paid $14 for a CD that had 14 songs on it—13 of which might be filler. iTunes’ 99-cent songs brought back the single—but cheaper. (45s used to cost $3.) The result: the collapse of the music biz. According to Forrester Research, total U.S. music sales and licensing revenues fell from $14.6 billion in 1999 to $6.3 billion in 2009—a decline of 57 percent in a decade. People still liked music. They just didn’t have to pay for it anymore.

There are already apps that sell e-books by the chapter. Some publishers give away free chapters as samples. Why should a college student assigned to read chapter two pay $40 for the whole thing? À la carte book sales will further depress profits.

Why should you care if traditional publishers go under? What about the democratizing effect of the Internet, which allows anyone—not just big-name authors hooked-up with fancy well-connected agents—to publish a book?

Granted, digitalization opens doors for writers who might never have been able to break through the “no unsolicited manuscripts” wall that surrounded old-media gatekeepers. Elitism was and remains a problem.

But there’s a bigger problem: removing the profit incentive from books means more titles about vampires and werewolves and fewer in the fields of history and sociology. Because lower profits make it tougher for publishers to invest in big time-intensive projects, it deprofessionalizes our highest form of popular culture. The historian Robert Caro began working on his brilliant five-volume biography of Lyndon Johnson in 1982. He expects to finish in 2015. Tiny digital royalties eaten away by piracy couldn’t have sustained Caro’s research for three years—much less 32.

“Inside [the Kindle’s] plastic case, other things lurk,” Sarah Lee writes in the UK Guardian. “Sci-fi and self-help. Even paranormal romance, where vampires seduce virgins and elves bonk trolls. The e-book world is driven by so-called genre fiction, categories such as horror or romance. It’s not future classics that push digital sales, but more downmarket fare. No cliché is left unturned, no adjective underplayed.”

Goodbye, Mr. Caro. Hello, 99-cent fan fiction.

You might not care. But you should.

Fourth but not last: the loss of a product’s brick-and-mortar distribution outlets reduces consumer consciousness of a product. In New York, where I live, all the music megastores—Tower, HMV and Virgin—are gone. So are most small record stores.

I used to spend at least one day a week hopping from one CD store to the next. I probably spent $50 to $100 a week on music. Now I spend the same amount in three months. I still love music. I just don’t think about it as often. iTunes is just a list of names and titles.

Now Barnes & Noble and what’s left of the independents are all that’s standing between an uncertain present and a disastrous—music-like—future.

“Sure, you can buy bestsellers at Walmart and potboilers at the supermarket. But in many locales, Barnes & Noble is the only retailer offering a wide selection of books,” notes The New York Times. A broad, deep book industry requires retailers willing to sell midlist titles and books that don’t do well—i.e., most of them.

Publishers say they want to save B&N, which is locked in an existential fight against Amazon. Things turned ugly after Amazon urged bookbuyers to visit stores in order to use their smartphones to scan barcodes of titles so they could buy them elsewhere—online, from Amazon, at a discount. B&N retaliated by banning books directly published by Amazon from its stores.

Amazon says it doesn’t want to drive B&N and other brick-and-mortar stores out of business. Their actions belie that. But if Amazon management were smart, they would subsidize stores like B&N. Remember what happened to the music biz when record stores disappeared—the overall music business cratered. All music sales, including those of iTunes, would be higher today if Tower et al. were still around.

Sadly, Amazon doesn’t seem smart. Like most American companies, it’s looting its own future in favor of short-term, quarterly lucre.

“Shopping on Amazon is a directed experience—it works best when you know what you’re looking for,” says Charlie Winton, CEO of Counterpoint Press. “But how does that help with, for instance, a first novel? When independent bookstores were in a healthier state, staff picks and hand selling could bring attention to great books people didn’t know they wanted. Now that’s much harder.”

And many of those bookstore “customers” would have eventually bought that book from Amazon.

E-books are here to stay. But there’s a way to save the overall book business for both print and electronic editions. The solution requires three parts.

Congress should join the other countries that have major book industries in passing a Fixed Book Price Agreement, in which booksellers and publishers agree on what price books may be sold nationally—i.e., no $25 books selling for $10 at Costco. In France and other nations studies have shown that FBPAs protect independent stores, increase the diversity and quality of titles sold, and support more authors.

Recognizing the unique cultural contribution of books as well as the threat to our national heritage posed by digitalization, Congress should exempt publishers from antitrust laws. This would allow publishers to collude to set prices and hold the line against predatory discounting.

Finally, publishers should flip the current arrangement, in which Amazon enjoys steeper discounts than brick-and-mortar stores. Even if Amazon gets charged a higher wholesale price they still have big advantages; many people don’t live near a store or are simply too lazy to visit one. And they carry everything.

It’s more than a question of preserving print as a fetish commodity. E-books won’t thrive if their print forebears vanish.

(Ted Rall is the author of “The Anti-American Manifesto.” His website is tedrall.com.)

COPYRIGHT 2012 TED RALL

SYNDICATED COLUMN: Next: Digital Totalitarianism

The Conspiracy to Abolish Cash

For many years figures on the political fringe, especially on the right, have claimed that the government and its corporate owners want to transform us into a cashless society. Their warnings about the conspiracy against paper money fell on deaf ears, primarily because the digitalization of financial transactions seemed more like the result of organic business trends than the manifestation of some sinister conspiracy.

Now, however, those who want to do away with liquid currency are stepping out of the shadows. They talk about increased efficiency and profit potential, but their real agenda is nothing less than enslavement of the human race.

“Physical currency is a bulky, germ-smeared, carbon-intensive, expensive medium of exchange. Let’s dump it,” argued David Wolman in Wired.

Citing a 2002 study for the Organization for Economic Development that states “money’s destiny is to become digital, ” a Defense Department-affiliated economics professor has authored an Op/Ed for The New York Times that asks: “Why not eliminate the use of physical cash worldwide?” Jonathan Lipow urges President Obama to “push for an international agreement to eliminate the largest-denomination bills” and urges the replacement of bills and coins by “smart cards with biometric security features.”

Lipow’s justification for calling for the most radical change to the fundamental nature of commerce since industrialization is, of all things, fighting terrorism. “In a cashless economy, insurgents’ and terrorists’ electronic payments would generate audit trails that could be screened by data mining software; every payment and transfer would yield a treasure trove of information about their agents, their locations and their intentions,” Lipow writes. “This would pose similar challenges for criminals.”

Terrorism is a mere fig leaf. According to the annual “Patterns of Global Terrorism” report compiled by the U.S. State Department, the highest total death toll attributed to terrorism in the last 20 years occurred in—surprise—2001. Including 9/11, only 3,547 people were killed in 346 acts of violence worldwide. Tragic. Obviously. But, in the overall scheme of things, terrorism is not a big deal.

Measured in terms of loss of life and economic disruption, terrorism is a trivial problem, hardly worth mentioning. According to the UN, 36 million people die annually from hunger and malnutrition. Over half a million die in car wrecks—but you don’t hear people like Lipow demanding that we get rid of cars. A more legitimate concern is the “loss” of taxes upon the underground economy, estimated by the IMF at 15 percent of transactions in developed nations.

What the anti-cash movement really wants is digital totalitarianism: a dystopian nightmare in which the entire human race is enslaved by international corporations and their pet governments. An anti-establishment gadfly like WikiLeaks founder Julian Assange could be instantly deprived of money—and thus freedom of movement—with a couple of keystrokes. (We saw a preview of this when PayPal and Amazon shut down WikiLeaks donation mechanism and web server, respectively.) The high-tech hell depicted by the film “Enemy of the State” would become reality.

It is true that, in a society where every good and service has to be paid for with a debit or credit card, terrorist groups would find it much harder to operate. Don’t forget, however, that today’s terrorists often become tomorrow’s liberators. Anti-British terrorists George Washington and Thomas Jefferson wouldn’t have stood a chance if the Brits had been able to intercept wire transfers from France.

Decashification would establish digital totalitarianism, a form of corporo-government control so rigid, thorough and all-encompassing that by comparison it would make Hitler and Stalin look like easygoing surfer dudes. The abolition of unregulated financial transactions would freeze the political configuration of the world, making it impossible for opposition movements—much less revolutionary ones—to challenge the status quo.

A society without dissent has no hope. Even if we lived in a perfect world where everyone was ruled by wildly popular, benevolent, scrupulously honest regimes—ha!—eliminating the slightest possibility of opposition would lead to barbarism.

We’re already more than halfway to a cashless society. In the U.S. few young adults still use checks. In many countries debit and credit card transactions now exceed those made via cash and checks combined. In 2007 the chairman of Visa Europe predicted the abolition of cash by 2012. Obviously he was wrong. But that’s where we’re headed. The U.K. plans to abolish checking accounts by 2018.

Even if you love your government, don’t want it to change, and think political opponents belong in prison, you ought to worry. As things currently stand, we know the big banks can’t be trusted. Remember when they introduced ATM cards? Banks wanted us to use them so they could lay off tellers. Then they instituted “convenience fees.” Which they have raised, and raised, to the point that taking $20 out of an out-of-town ATM could cost you $5 in fees ($2 for their bank, $3 for yours).

Imagine what your life will look like under digital totalitarianism. Your pay is direct-deposited into your bank account. You’ll pay for small purchases with your cellphone; if you owe a few bucks to a friend you’ll be able to bump your phone against your friend’s to settle up. Nowadays, some corporations allow you to control when your bills get deducted; in the future they’ll demand that you authorize them to do it automatically. What if you have a disputed charge? They’ll already have your dollars, or work credits, or whatever they’ll call them. Good luck trying to get it back from the Indian call-center guy.

As corporate ownership becomes increasingly monopolized and intertwined, your overdue phone bill might be owned by the same outfit as your bank, which would simply take what it says you owe.

The law of unintended consequences is getting a serious workout thanks to digitalization. Motorists in New York were thrilled when the EZPass system allowed them to breeze past lines at toll bridges—at a discount, no less. Then divorce lawyers began subpoenaing EZPass records to prove that a spouse was cheating. Next police set up EZPass scanners on the bridges; if you pass two of them too fast, a speeding ticket is automatically generated. The next step is to eliminate cash lanes entirely; non-EZPass tag holders will soon have their license plates scanned and receive a bill by mail—plus a $2 to $3 “handling” fee.

Think there are too many fees now? If you think you can’t trust banks now, imagine how badly they’ll gouge you when they control every single commercial transaction down to the purchase of a pack of gum. Angry about taxes? When tax agencies can take the money out of your account without asking, they will. Unlike cash, that phone bump to pay your friend will be a trackable, data mineable, fully taxable commercial transaction.

As if the post-2008 economic collapse hadn’t proven that no one is looking out for We the People but ourselves—and then barely so—the digivangelists tell us not to worry, that Big Brother, Inc. will smooth out the rough patches on the road to techno-fascist domination. From Wolman in Wired: “Opponents used to argue that killing cash would hurt low-income workers—for instance, by eliminating cash tips. But a modest increase in the minimum wage would offset that loss; government savings from not printing money could go toward lower taxes for employers.” Sure. The same way banks passed on the savings they earned by replacing tellers with ATMs to their customers.

Americans are skipping into the digital inferno wearing a smile and relishing the smell of their own burning flesh. Countless friends and acquaintances pay all their bills online. “I’m all about using my checking account in place of cash and would love to be able to eliminate cash entirely from my life,” gushed PCWorld’s Tony Bradley recently.

“Give me convenience or give me death” was the title of an album by the punk band Dead Kennedys.

We’ll get both.

(Ted Rall is the author of “The Anti-American Manifesto.” His website is tedrall.com.)

COPYRIGHT 2010 TED RALL