Analogue to Digital: How technology changed the music industry
From vinyl to streaming, the landscape of the music industry has changed phenomenally over the past half century. This includes accessibility, price, audio quality and range of genre has dramatically improved across the industry. Gone are the days of saving up to purchase a new record from a favourite band, forget about only being able to purchase the LPs sold in your local record shop, away with scratched records or damaged turntable needles — now you can stream anything, for very little, and reliably!
From Vinyl to Compact Disc
Distribution is at the heart of the music industry. Vinyl was a triumphant distributional audio format in its day as it was the only way to purchase and consume music recordings at home. Vinyl came with a handful of problems such as surface noise or tracking errors. This meant the stage was set for a new and better technology to take over. Indeed, when the Compact Disc was released in 1982, the industry would take a new path.
CDs could hold significantly more detailed audio files than vinyl, resulting in a smoother listening experience, higher fidelity recordings, and no variable playback speed. CDs carried large WAVE or .wav files. These files were so large that they were difficult to store on personal computers in the early 1990s, so developers worked on a new solution.
The creation of the MP3
Launched in 1991, the .mp3 was designed to mitigate the barriers to storing and hosting audio files online produced by .wav files. .wav files were too large, and took up too much bandwidth. The .mp3 is a compressed, ‘lossy’ audio format, meaning that in order to reduce its file size, certain bits of information are discarded in the compression processes, but not enough for the majority of consumers to notice or care. It was an incredible development in the story of modern music as suddenly the internet could gain access to audio formats far more widely because they were The .mp3 set in motion the dissolving of the music industry as it had stood for nearly one hundred years.
MP3 Takeover
Illegal file sharing ran wild in the late 1990s as fans began to download their audio CDs as .wav files and subsequently converted them to .mp3. File sharing was made easy with the mp3 and saw illicit file sharing websites and web forums appearing across the internet. It was all down to its accessibility as a storable file format. Its compact size but retainment of audio quality made it perfect for the average fan. In 1999, Napster was born, encouraging the peer to peer file sharing of audio files. At the height of its success, Napster had 80 million users. It boasted of being the best platform for finding old, rare recordings or the latest chat topping hits, as millions of people uploaded and shared digitally converted versions of their favourite recordings.
Solidified status
Napster’s success didn’t last long. In 2001, a court ruled in favour of the Recording Industry Association of America’s bid to shut the website down. However, while Napster’s steaming success only lasted a few years, the .mp3 was evidently an incredible success story. It had showed itself to be the most useful and efficient audio format of the new century. Even as technology improved around it, with bandwidth expanding or computer processors getting faster, the mp3 remained in demand. It was such a simple format to code into websites that its continued adoption isn’t a surprise. Indeed, today, audio formats across the web broadly remain as .mp3 files.
An industry in collapse
Across one decade, the music industry showed major signs of collapse. In 1999 the market was valued at $14.6bn, but by 2009, it was valued at $6.3bn. That’s a 57% decrease in value! This was directly because of the peer to peer file sharing attitudes of the late ’90s. Consumers had had a taste of free music and now didn’t want to go back to paying. The music industry had to tackle with the new beast which was the rampant illicit file sharing which drove down record sales and market value. Something needed to be done.
Streaming
In the dawn of file sharing, streaming was born. It offered access to audio files without the need of downloading them first. Today, Spotify, Apple Music and Amazon Music dominate the industry. Merged with the constant crusade of finding and taking down file sharing websites and applications, the creation of a viable, charged service, either through ads or a premium subscription, gave way to a new financial model for the music industry. By 2020, 83% of the US industry’s revenue came from streaming services. The MP3 has been the the preferred format for audio streaming services both 15 years ago and today. Streaming services such as TIDAL offer higher quality streaming of .wav files, but this is still a niche market.
A damaged industry?
While the industry saw a rapid decline in value as free, illicit file sharing conquered in the early years of the 21st century, and confidence in the old, physical format of audio distribution dissipated, by 2021, the industry had returned to where it was valued at in 2001. Streaming has become the driver of the revival of the industry. This chart below shows the significance of streaming as it takes over from physical sales. Streaming has returned the industry to a workable financial model for many of the top record companies.
Return of old?
Now that streaming dominates audio consumption today, it may be surprising to learn that vinyl is making a comeback. 24% of Americans say they own a working record player, which paves the way for an aesthetically driven vinyl market. With modern pop stars such as Taylor Swift releasing new albums on vinyl as well as streaming services has proved to be incredibly successful. By 2021, 43.5 million LP sales were made in one year alone in the US. This is a 48 times increase on sales in 2006.
The MP3 has brought forth vast change within the music industry and out of it. It encouraged illegal file sharing which heavily damaged artists and labels, leading to nearly two decades of uncertainty, but as we emerge from the darkness of a declining industry, the MP3 leads the way. Once it had destroyed hope and careers, but is now the torch bearer for a changed industry. Streaming still heavily relies upon the efficiency and accessibility of the MP3.
