Start Making Sense

Record-business profits peaked 20 years ago, just before Napster and other file-sharing sites turned their world upside down. There have been occasional surges, but the future of the Compact Disc looks bleak, and while income from downloaded files is still climbing, the shift of profitability from à la carte music sales to unlimited streaming on demand seems inevitable. The realignment is already underway—the vast majority of today's music listeners, young and old, haven't bought a CD, file, or LP in years. It pains me to admit it, but after hearing, at the 2014 Midem music exhibition, a presentation by Marc Geiger, of William Morris Endeavors, I was convinced that music-streaming companies are poised to reboot the industry. If Geiger's predictions are accurate, the music business will be more profitable than ever, and swell to $100 billion in 20 years or less (see

Long before that, the market for physical media—music, movies, books, publications—will have shrunk to a size you could drown in a bathtub. Yes, oldsters and a smattering of hipsters will keep the faith, because we like to hold stuff in our hands. But long before that, everyone else will have jumped ship. It's already happening—a lot of kids use YouTube as their primary source of music. Pandora has 75 million "active" listeners, though only a small portion of them are paying customers. And at only $10/month, those folks are still spending a lot more on music than does the average person.

Those metrics are hard to swallow. I buy four or five new CDs/LPs a month, and lots more used albums. That may be a little more than the average audiophile spends on music, but most of my non-audiophile pals haven't bought music in a very long time. Ask your friends and relatives about their buying habits, then see if they use music-streaming services, podcasts, YouTube, or Internet radio.

And it's not just "civilians" who are moving on. A recording-engineer friend recently confessed that he's now a Spotify subscriber and, to reduce clutter, is selling off his entire collection of LPs and CDs. When he swore he'd never buy another album, I at first thought he was just trying to get a rise out of me. He was dead serious. He's tired of the game—he just wants to enjoy music without it being the central focus of his life. He's checked out.

I won't follow his example. I love having a large collection of LPs, CDs, SACDs, and DVD-Audio discs, and the memories that arise every time I play one of them. They've been a constant in my life, some for more than 50 years, and I can't imagine why I'd ever cut them loose. I have free subscriptions to Spotify and Pandora, but they don't do a lot for me. I find new music by hanging out in record stores and listening to podcasts, such as WNYC's New Sounds and NPR's All Songs Considered.

When I find music I like, I buy it. Sometimes, I make a bad call. Boo-hoo—that's the way it goes. Not every expensive restaurant meal satisfies, and sometimes you're going to see a movie or show that sucks. I'm willing to keep buying music, because I want to help support musicians when I can. Maybe, just maybe, if more folks did that, more bands would squeeze out albums faster than at today's pace of one every three or four years.

Yet I have to admit that Geiger's presentation alerted me to the very real possibility of a paradigm shift. He thinks that, in the long run, Google or Apple will crush Spotify, Pandora, and Beats Music in the streaming game. A couple of giants calling the shots in the music world is a scary thought, but Geiger projects one, two, even three billion users worldwide in 10 years. Even with "only" a half-billion streaming customers paying $10/month, that's $60 billion a year from streamed music.

Ten years is not so far away. Yes, some portion of the subscriber base will opt for free services supported by advertising, but even so—when the streaming services have hundreds of millions of users, the ad income will be substantial. It's still very early in the streaming game—the big changes and corporate moves are still at least a few years away.

Stereophile readers tend to have large music collections, but there's no reason we can't take advantage of what the streaming services will offer. It's hard to resist the temptations of 10 or 20 million tracks at your beck and call. Geiger didn't mention high-resolution streaming, but I'd expect that premium-price subscription rates will provide additional income—it's bound to happen. In France, already offers 16-bit/44.1kHz FLAC streaming, and bona-fide hi-rez streams can't be too far away. Would you pay $30–$40/month for access to a vast library of hi-rez recordings? To download a few hi-rez albums, that price might be really compelling.

In the near future, there may come a day when some of your favorite music won't be offered on physical formats or as downloads: If you want to hear what's new, you'll have to subscribe. That's not so different from how it works with some TV shows today: If you want to see House of Cards or Orange Is the New Black when they are new, you have to pony up for a Netflix subscription.

And the future of vinyl? Before I give up my LPs, Marc Geiger will to have to pry them from my cold, dead fingers. But I don't think it will come to that. From the vantage point of mid-2014, it's looking as if the LP will be the last surviving physical format. It's the one you can't get for "free." Of course, Geiger's forecasts may turn out to be wildly off the mark. The worst-case scenario is that we'd be back to the status quo. I could live with that.—Steve Guttenberg

Rick Tomaszewicz's picture

The world is full of good used LP's and CD's. Old farts keep dying or moving into care homes and their families ditch "Grandpa's crap" at the Sally Anne thrift store, or at a yard sale. Today I got 31 mint jazz CD's at the Sally Anne for $2 each, minus a 10% senior's discount. Two days ago I got 15 mint classical CD's at a yard sale at 5 for $12. I gave the seller my contact info in case her 80 year old husband wants to sell more. The fun of such foraging is that you never know what you'll find. You take a $2 flyer on an unfamiliar artist and might be surprised. I say keep our musical heritage out of the landfill - buy used records and CD's!

bonbon's picture

I don't believe streaming or digital compete with vinyl - I think vinyl is competing with all forms of media/digital entertainment - TV, YouTube, podcasts, movies, DVRs, even selfies are all competing for an audience. I have some great gear and don't want to distract from the topic by reviewing it, BUT... try to get family, friends, party goers to sit down while you place a profound musical event on your turntable - sound stage, air, depth... how long does their attention span last? No crashes, flashes, jokes, close calls, explosions - literally nothing to see - yet the recreation of a musical event is occurring right in front of them -- if you are old enough (quite) - ask yourself (or a grand/parent) when the last time was they/you listened to a sitcom or play on your radio, rather than TV? If they did not experience this during those formative years then how will this be a profound or intimate event for them? The music is always the most important part, yet a great song can be heard through any piece of equipment and be enjoyed. Periodically though, I do get a chance to play some great music for someone, a daughter's boyfriend or a bored guest and see their interest and face light up when they hear a song they like with a near live performance quality. Trouble is where do you tell them to go to purchase or replicate the equipment? Truthfully there are not as many independent audio retailers as we need to carry on this obsession -- everything must be visual, verbal, and guided now -- never be a wine (audio) snob and say you taste(hear) something they cannot (Ugh!) --lamenting change will not keep us going, we must fill the showrooms - everyone growing up had an uncle or neighbor who had totally cool stereo gear, even if it was a Magnavox Console (or Bose 901s?!) and as a child you were pretty much forbidden from touching it, yet ... if you were able to put on a record or roll the volume, as well as the treble and base knobs, it was nearly as profound as that first time you drove a car.
So, my recommendation, if you want to see an analog format in ten years, the next time you get an opportunity to demo a record, let the friend or guest pick the record, and (gulp!) place it on your turntable, lower the arm and... play - ownership of the experience is the key I think. All the best to everyone in your audio pursuits.

dalethorn's picture

I think the article should be qualified to say that the big money will be in streaming, and/or the media attention will shift to streaming, etc. etc. But, no matter how many times the analysts and pundits repeat the mantra of "the Cloud" or "streaming on demand", the fact is that audiophiles will want playback that's uninterrupted and completely clean, if not perfect fidelity. For me, clean and uninterrupted are a very high priority, and streaming will never achieve that no matter how much subscription money you throw at it. I suppose you could stream your music into a storage unit of some kind for later playback, like those boxes that record subscription TV programs for later playback, but audiophiles would want more assurance than "It should play back uninterrupted later, and it should be fairly clean...."

tonykaz's picture

Oh this Changing World .

As a High-End Audio ( Analog ) retailer back in the 1980's I cringed at the new CD 16/44.1 , now , Today , the DACs are better than my best Koetsu / VPI Edison Player's very best performances , thank goodness .

I suppose I'm slower to change now as these "newer" internet-based concepts present themselves , grand promises from pleasant introductory voices of reason .

My Hard Copies are priceless , they all seem to improve with advances in DAC technology i.e. MSB analog Dac as an example of astonishing levels of revealed Musical renderings never before realized , on 16/44.1 no less , who needs 24/192 ?

I think that I need my iTunes library in lossless , it organizes and remembers . There is no way possible for me to remember all the great 4 and 5 Star music I now have at my fingertips , even when I'm off-the-Grid somewhere .

However , I will subscribe , IF I can download and Hard Copy to a Hard Disc CD for my long term storage in the event of a Computer Hard Drive Failure ( again ) .

All my music stored is my Treasure Chest of delights , I pledge that I will never abandon the Actual Hard Copies , especially in favor of a collection compiled by a DJ service prone to go out of business or modified by the Bean Counters .

You did well to reveal the temptations of a possible Billions of Dollars Industry that drives the Futurists to con jour an access to a very large Slice of that percieved "Gold Mine" . Extrapolating out the possible Future of the Music Industry is a timely exercise of the Science Fictionists among us . All industries have these futurists making predictions , the Second Generation Google Car is a good example of this .

Now as a personal note ; I wrote to Tyll this morning , thanking him for his insights into this Headphone concept , I would like to now thank You as well . Both you and Tyll in the Frozen North represent the rarest of all types : those that say what they mean and mean what they say ! I have made numerous purchased based on your recommendations , all these investments proved successful , not a single dud , no buyer remorse ever set in , a phenomenal 100% Track Record .
I don't do Audio Shows anymore , ( I have done many a CES in my day and don't miss them at all ) , the point is that I can absorb your suggestions , contemplate the investment and act , relying on your wisdoms to be much better informed than I could possibly arrive at from an impulse purchase from a momentary impression at a Show Booth . Both of you have proved to be 5 Star Consultants in the Musical Reproduction World ( even though I've been in the Audio Business since the 1960s selling Fisher Tube Stuff , oh my , so long ago ) .

Thank You for being there , thank you for sharing your wisdoms , thank you for taking the time and thank you for being realistic in your appraisals , I check your site every day and admire your Compass heading .

Tony Kaz in Michigan

Osgood Crinkly III's picture

First we had tubed FM receivers and vinyl records, which, whatever their faults, at least preserved some semblance of musical harmonics, the color of sound, the unique signature of every instrument and voice.

Then we had solid state, in which there was significant loss of harmonics, all in the name of an aseptic sterility.

Then we had CD's, in which harmonics were stripped to practically nil; but we got, in exchange, pitch stability, frequency extension and dynamic range. It was like trading in the family sedan for an extremely uncomfortable hot rod, with no room anymore for the family dog.

Then came streaming, MP3, in which even the advantages of CD's were gone. The sound rivaled old AM in how bad it was.

Ah, progress.

PS. I've been subscribing to "streaming" for years. It's called satellite radio and iTunes. Ever hear of them? Ever hear how bad the sound is?


Naimdude's picture

What this guy said! Enough of this downgrading of audio quality.

wozwoz's picture

Osgood Crinkly said:


Well said!

Anon2's picture

I have examined the download/streaming movement. I have assessed if its offerings meet my needs. I have found that these offerings do not meet my needs. I suspect that other music enthusiasts, particularly those with deep collections of selected repertoire, most likely in the jazz and classical genres, have found the same lack of depth in the on-line music media of streaming and downloads.

Most music found on the various downloading and streaming sources tends to be from a mainstream of the various musical genres (jazz, country, classical, etc.). Or as I found when sampling Pandora, non-mainstream works tend to be copies of CD era recordings, many of which are not known for being remarkable performances.

Go to arkivmusic; go to Go to these sites with your 1,600 page Penguin Guides to Classical CDs, with an open mind for new releases in the classical genre, or looking for an obscure classic rendition of a work, and you will find what you will not find in the various streaming/download sites: choice, choice and more choice.

Existing repertoire in less than mainstream classical works is limited outside of the CD catalog. Go to a download site. Tell me how many recordings of Rachmaninov's Etudes Tableaux that you find (I'll bet you may not even find one). Tell me how many complete sets of Hadyn Piano Sonatas you'll find for download; tell me how you program a streaming service to get all of these works played for you in succession the way you would out of a box set of CDs.

Labels like Pentatone, Channel Classics, and BIS are bringing on exiting new artists, and previously unknown works at an impressive rate. The SACD quality of such labels' works are impressive enough for me (I won't get into the debate of how much better they might sound, with the attendant jumble of apparatus, and risk of hard-disc crashing, that one gets through downloads). In any event these works aren't to be had through these new media.

Downloads and Streaming are promising new technologies. They will work just fine for many, if not most, listeners; for this reason they may dominate "music sold." I'll even stream to a DAC from sites like ORF, Radio Nacional de Espana, and the BBC at times.

These technologies will, however, have to sweat through the work and details of building a credible and thoughtful repertoire to match what is available (new and used) in the CD medium.

Technology has changed much, but it can't meticulously build these repertoires overnight; I'd bet that many of them don't want to build these repertoires; they'd just prefer to stay on the safe ground of issuing yet another Beethoven symphony, which the devoted collector already has in life-time supply on his/her shelves.

remlab's picture


Osgood Crinkly III's picture


TIIGA's picture

The only good thing about streaming audio is to fill the gaps between truly great audio experiences...just wait until these people who have liquidated their solid state media have a financial hardship, they'll have nothing to listen to.

music or sound's picture

115 million people in the US have no access to broadband internet. Only mp3 at low rate is then possible. Everywhere one can get a CD and maybe a vinyl version but decent downloads speeds for lossless streaming is only easy in affluent urban areas. Also a very costly idea for wireless internet and more and more music will be "consumed" through mobile devices. So first the record producer have to convince the service providers.
I am also wondering who came up with the idea of the death of the CD. It was pronounced by magazines (including Stereophile) and equipment manufactures but there is so much more music available on CD than on any other medium. Streaming may be the future of mass market music consumption but not for access to more selective listening.
It would be good to see an article about CD-transports these days in Stereophile!

Gorm's picture

While most of the above comments are perfectly valid no one has mentioned of the most grievous faults of the new download: lack of technical information. Even the lowly CD at least informs us of the musician lineup, producer and recording venue. My expensive DSD downloads may offer a PDF on the side but this is hardly useful unless it is printed to read along while listening.

I treasure my good vinyl (there are millions of crappy ones as well); I enjoy my good Cd's (ditto comment earlier) and I now do DSD which (mostly) sounds excellent, but you can't beat the feel of, and useful information on, a good Vinyl cover.

Al from Hudson Avenue's picture

There's no way to say this without being a jerk so I might just as well be a jerk. There is no way my favorite music is ever going to be online. I like the classical performances on old punk classical labels. Those will never go up. I like the sound of 45rpm 1958-1963 rock and roll. Those will never go up, in the original sound. I like Doo-Wop from the master tapes. Those will never go up. Even Rhino completely screwed -that- up.

dalethorn's picture

There's a lot of wisdom in that. To really get that '58 to '63 sound right, the "remaster" guys would need to actually listen to the songs as they transfer them. But who will take the time to do that? Even the music itself is automated more and more today. Pop music that is.

Bill Franklin's picture

Don't you see the irony? Here we are, bemoaning the demise of antiquated technologies, on the internet! (Print's obviously making the jump.)

There have always been poor recordings of good music, regardless the media, and the masses remain unfazed. There are also many excellent recordings; you just have to put in the time to find them. There are enough audiophile web sites, and hi-res on-line retailers to see me well into my doddering years, which are much closer than I'd prefer.

Audiophile's always been niche, and will remain so. It's not going away, it's just undergoing a digital metamorphosis along with the rest of the world. And when it's done, you probably won't recognize it. It certainly won't be as you remember it, and you may not even like it.

Ah - the good old days! I remember them well. Playing those 78's on the old Victrola.

Al from Hudson Avenue's picture

Actually, I had a hi-fi 78rpm system for a while. It was extremely enjoyable.

Et Quelle's picture

Streamers enjoy hearing nearly everything ever recorded as they walk or ride home. It is somewhere inside their phone or car radio hard drive. But if they miss a couple payments due to mishap or lack of funds. Their money is gone and they have nothing.
But LPs will always be here; since 1890. If I have no cash on my card or my phone malfunctions, I still can enjoy what is mine at no cost. I am under 40 though I love that classic feeling of owning the music

I will stream soon though it is only for when I am lazy or run out of LPs and CDs. When will Audio Research and Luxman stop making hi-end CD players?

wozwoz's picture

If you haven't followed the link to the excellent Youtube presentation by Marc Geiger, it is certainly worth having a listen. Contrary to Steve's claim that downloads are 'still increasing', Marc makes the very clear point that the age of the download is already over ... downloads are ALREADY in decline, and have been dropping at about 10% per year since late 2012.

Music basically falls into 2 categories: DISPOSABLE and COLLECTABLE.

If you just want to sample something, or it’s the fun track of the day, then most people will listen to it for free on spotify or youtube or the radio. But if it defines your sense of who you are, … you buy it, because you like it and want it.

That is presumably why Marc Geiger advocates that:

* Streaming will continue to grow: it caters beautifully for the Disposable market
* Physical media (CD, SACD, Blu-ray etc) will continue as well: it caters for the Collectable market.

In particular, Marc makes the point that physical media excels in the premium value-added sector, which is all about cool packaging, higher resolution formats like SACD and Blu-ray, special editions and the like.

What is interesting, though, is that DOWNLOADS do not fit into either category: they are not Disposable, and they are not Collectable (and they have zero resale value) ... which helps explain why they have become the 21st C equivalent of the dodo.

deckeda's picture

Looking at a list on paper is easier than looking at it on a screen. Maybe our eyes can simply scan it faster.

It's the same when looking through rows of physical media vs looking at what iTunes holds.

All of that helps keep the music in our consciousness, even at the risk of sometimes not making room for new music. I like Spotify but dread the idea of making lists in the hopes of collecting what I like. Otherwise, yes you will forget about it.

The poster above who advocated the now-seemingly impossible scenario of instituting a listening session with unsuspecting friends and family is on to something old, new and subversive. None of whatever we prefer related to physical media can survive without that experience. I "stream" songs and "LPs" from iTunes over to the stereo all the time but it's not the same experience, and you can't divorce music from its "experience" too far before it loses importance ... and relevancy.