-- Despite all the possibilities the digital age brings forth, music is still slumping. While its helped usher in things like the viral music video, sales of actually music hasn't become the money maker that CDs once were for major record labels.
According to a recent study by Will Page, chief economist of the MCPS-PRS Alliance, (via Times Online), 90% of all digital tracks for sale over 2008 didn't sell one copy.
The report said that "10 million of the 13 million tracks available on the internet failed to find a single buyer last year."
The study found that, for the online singles market, 80% of all revenue came from around 52,000 tracks. For albums, of the 1.23 million available, only 173,000 were ever bought, meaning 85% did not sell a single copy all year.
Chris Anderson, author of The Long Tail, predicted in his book that the internet economy's love for niche markets would shift from a relatively small number of "hits" (or mainstream products) at the head of the demand curve toward a "huge number of niches in the tail."
However, in the new study by Will Page, it suggests that the niche market is not an untapped goldmine and that online sales success still relies on big hits.
"I think people believed in a fat, fertile long tail because they wanted it to be true," Andrew Bud, Will Page's co-researcher, told the Times Online. "The statistical theories used to justify that theory were intelligent and plausible. But they turned out to be wrong. The data tells a quite different story. For the first time, we know what the true demand for digital music looks like."
Anderson doesn't, however, feel his "longtail theory" is wrong. He says Page's study needs a lot more evidence to undermine his findings.
"I respect what Will's done and have no doubt that he has indeed found a dataset where it doesn't work, but I'm not sure you can conclude much, if anything, beyond that," Anderson said. "If he's trying to undermine the entire Long Tail Theory, he'll have to provide a lot more evidence. I welcome the debate, but until Will's prepared to publish data and sources we don't have much to talk about."
What does this mean for digital music? Who knows. Only time will tell. Sound off in the comments with your opinion.