Not so fast, suits. Although a recent blog post over at the music industry news website Coolfer has taken notice of the improved Universal Music Group's Q1 earnings in 2008, it would be nothing if not premature to say that the nightmare is over for our favorite major labels. Undoubtedly a step in the right direction, the increased profits may have some at the top breathing a little bit easier, but music fans remain well aware that little, if anything has been done to combat the ever increasing schism between corporation and consumer that has plagued the music industry since their heyday in the mid-to-late 1990s. Business buffs can pour over the report themselves, but the highlights outlined on Coolfer are as follows:
- Digital sales have increased 33% year over year
- Fiscal 2007 saw a 51% increase in digital sales (totaling 14% of total revenue)
- A 54% increase was seen in digital sales from Q1 of 2007
- Revenue increased 0.6% with operating profit rising 94.7%
So, while showing signs of life, the numbers remain far from ideal. In fact, many are pointing toward UMG's recent business acquisitions, not increased sales, as the reason for higher, somewhat flashy top line numbers. Snappy statistics may be pleasing to the ear and the bank account of a few, but what's clear is that the growth of digital sales is nowhere near great enough to account for the rapid decline in actual CD sales. We hear chatter of new business models aimed to simultaneously help artists and labels, and innovative solutions for piracy that will finally usher us all into the digital era together (and without lawsuits), but walking into our local music retailer, we're still too often met with increasingly outdated, lackluster product and a system of marketing with the same bloated price tag. Improvements? Maybe next quarter.
