This is a re-write/rephrasing of something I posted two days ago. I realized my phrasing was way too broad and that I was ignoring the non-monetary value of music. My argument was that music has little to no monetary value. Hopefully this is now a little more accurate.
Music is now without monetary value. This is a controversial statement and I’m sure many will disagree with it on the basis of both personal conviction and economics. I believe I can address the economic objections and I hope I can also sway some to reevaluate their belief that the music they create, sell, or buy has a monetary value.
The reason for the “worthlessness” of music (and I say this in a purely economic sense and I am not referring to the personal value music holds for many) is its infinite supply. In a manner of minutes (seconds?) I can find and download almost any album or song online for free. Putting aside the legal objections to this action (and since 95% of music downloaded is done so illegally, this objection is largely irrelevant), this essentially infinite supply of music renders it without a monetary value.
This has several implications. It does NOT mean that it is impossible to make money through the sale of music. However, the days of selling albums or songs at 128kbps or 192kbps are rapidly drawing to a close more and more people awake to the notion that the supply of music at these bitrates is infinite and that paying money for them is a silly proposition. The economics of scarcity and abundance are worth examining. People have stopped paying for music for the same reason people don’t pay for air. It’s everywhere and free so why would you?
Except people do pay money for air, in certain circumstances. If you scuba dive, you will gladly pay good money for air. Of course, the value in this situation does not come from the air itself but from the packaging and delivery of the air. In short, air = worthless. Air in a tank when you need it = valuable.
Likewise with music, the basic digitized music is increasingly hard to sell for money but there are ways to add value to it. One such way is to offer higher quality files, such as 320kbps or lossless. Another is to add value through packaging. This is why Nine Inch Nails was able to sell 2,500 of their $300 Ultra-Deluxe Ghosts boxset. The music itself was free (you could download it from the NIN website) but the packaging added the value. Because the Ghosts Ultra-Deluxe boxset was autographed by Trent Reznor himself, it is an example of a third way to add value to music: by adding a connection to the artist. This is the “souvenir method”. People are willing to pay money, or more money than they normally would, if there is a component of connection to the artist. Autographs can provide this connection as can individualized artwork. Selling music at a concert is less about selling the actual music and more about selling a physical memory of the event, thus providing the connection to the artist.
It has been pointed out to me that there many other types of value contained within music still. While this is the topic for an entire other post, the attention and personal conviction behind music absolutely have value. My argument is merely that on a macro scale, people are increasing realizing that paying for music with money is not a fair proposition for them, the consumer (hence the drop in CD sale). They are willing to pay when this music has value added to it (hence the rise in the sale of vinyl – the value is in the better packaging).