Are downloads losing luster with buyers?

• Mike Barris' trenchant look at digital music (#3)

Can it be true? Are people already tiring of music downloads?

If you believe Matt Rosoff, yes.

Rosoff, an analyst for the independent research group Directions on Microsoft, told a podcast audience early this month that a change in listening habits in just the past several months has caused speculation that people are ready to shift from downloads services such as industry colossus iTunes to more of a radio-type streaming service such as Pandora or Rhapsody.

“A lot of people were used to buying music for a long time," Rosoff opined. "Everybody had their record collections and then their CD collections, and so it was an easy transition when the first commercial digital music services came out.

"And I think about two or three years ago, people started to realize that I’ve got 3,000 or 4,000 songs, but I am kind of sick of arranging them into playlists," Rosoff said. "I am kind of sick of going through my collection and figuring out what I am going to listen to, and there was almost this shift: wouldn't it be nice if somebody else could drive for me?"

Rosoff pointed out on the TechFlash podcast that Apple Inc. tried to capitalize on the change in music-consumption habits without undercutting its business model, by coming out with Genius, which constructs playlists around particular songs in a user's iTunes library. “But I think people are increasingly discovering more radio-type services,” he said. Rhapsody, Rosoff pointed out, was on the scene in the beginning, but "a ton of new competitors have popped up in the last six months," including Mog radio (http://www.mog.com), and Rdio (http://www.rdio.com), created by the founders of Internet phone service Skype, and Spotify (http://www.spotify.com/int/about/what/).

“It seems that there’s a lot of buzz around the idea that instead of buying individual downloads, you’re going to subscribe or you’re going to pay a monthly fee and you’re going to get whatever you want, whenever you want," Rosoff said. "The trick is making sure that that works on all sorts of devices.”

(Read a review of Mog and Rdio here: http://www.masslive.com/entertainment/index.ssf/2010/08/review_rdio_mog_music_service_comparison.html)

(Listen to Rosoff's full comments at: http://icestream.bonnint.net/seattle/kiro/2010/10/p_TechFlash_20101001_1pm.mp3)

The watershed moment in the history of music downloads was Jan. 9, 2001 - Apple's introduction of iTunes, its digital media-player application, used for playing and organizing digital music and video files, and for managing content on the iPod, iPhone, and iPad. iTunes is a brilliantly conceived system in that one can connect to the iTunes Store through the Web to buy and download a range of media, from music to movies to apps. It is also used to download applications for the iPhone, iPod touch and iPad.

Rosoff’s comments reflect the flattening of digital-music sales in recent years. Early this month, Neilsen Research reported that U.S. digital music-track purchases for the first six months of 2010 totaled 630 million, flat with the year-ago figure. Sales began to slow significantly after jumping 28% in 2007-2008. In 2008-2009, sales posted a considerably smaller increase of 13%.

Nielsen Research analyst Jean Littolff blames the sagging sales on weak consumer confidence, weak release schedules and confusion over the many choices people have to buy music online. Although the stagnant condition is a “plateau,” it “doesn’t mean that this digital consumption is going to drop significantly,” Littolff said. “It’s a plateau, but it’s not yet saturation.” (Read the full report at:

http://www.internetfinancialnews.com/financialblogtalk/news/ifn-6-20101001USDigitalMusicSalesGoFlat.html)

The slowing downloads sales, combined with the growing appetite for radio-style streaming services such as Pandora and Spotify, are driving interest in online in-car audio, according to data from Vision Critical. An online survey of more than 4,000 consumers in the United States, Britain and Canada found that one in four drivers regularly play personal digital music through their car stereo system. Broadcast radio is still the dominant source of audio in the car, the survey showed.

(Read the survey here: http://www.rbr.com/media-news/internet/28202.html. See more on this topic at:

http://www.rbr.com/radio/28218.html)

This seems like a good moment to introduce this week’s Open Mike interview. I talked with Ed Long, the music director of Trenton, N.J., radio station WIMG-AM 1300. WIMG is a traditional, brick-and-mortar broadcaster whose mission is the “appreciation of black gospel music as an art form.” The station targets primarily an African-American market in western and central New Jersey and the suburbs of Philadelphia. It has an audience of about 500,000, and an Internet presence at http://www.wimg1300.com.

I asked Ed to predict the next big technological change in radio music. His answer speaks to the declining enthusiasm for downloads and the embrace of radio-type streaming systems:

“CD players will be gone," he told me. "I think it will be a improvement of the MP3 quality audio, that it doesn’t take up as much space; WAV files take up a lot of space. I think there will be a way that you can save you file and it will be very good quality, but it won’t take up a lot of space. There will be an iPod-type device built in to a car – they’re already doing it now, where you can upload all your music in your car so you don’t have to carry a CD or carry an iPod anymore. You can just hit a button and all your music is right there. That’s the next thing: being able to store more music, better quality, but taking up less space.”

Listen to my complete interview with Ed here: http://www.box.net/openmike101#openmike101/1/52605102/516848666/1

Ed remembers the pre-digital era, when the radio business was mostly controlled by a small group of large corporations and nonprofit media organizations. Since gospel music abounds on Internet radio stations, “you have to stay current with the website,” especially in making it easy for listeners to download artist podcasts,” Ed said. Audiences, he noted, “can pretty much listen to what they want to. I even have an Internet station myself. You don’t have to rely on a radio station to play what you want to hear.”

ED LONG

Nowadays, Ed pointed out, AM radio stations tend to shy away from music programs – preferring, instead, to embrace talk or news formats. “The digital age has changed it,” he said. “People don’t tolerate the AM signal – the sound is not as clean. But we know our target audience: it’s about 50 years of age, and they know the kind of music we play.” A list of typical WIMG gospel artists would include such names as Donnie McClurkin, Marvin Sapp, Hezekiah Walker, Byron Cage, Kirk Franklin, and Tye Tribbett.

(Listen to Hezekiah Walker's boisterous performance of "Souled Out," here:

Adding CD-quality audio is costly, Ed added, because it calls for more bandwidth to accommodate the signal. "My station sounds the way FM used to sound before digital, so it takes up less space and it's not as expensive," he said. "If the music is good, people won't mind (a slightly flatter sound) as much."

To keep listeners engaged, WIMG's strategy is to keep a playlist that is somewhat more elastic than those of most mainstream AM music stations, Ed said. At many stations, "you will hear the same 10 to 15 songs every couple of hours," Ed observed, "because they want you to hear a hit whenever you turn the station on... Our playlist is not as tight as some." Some of the slack in the lineup, he said, is taken up by breaking in new artists - one way in which WIMG cements its relationship with its core audience. Just the same, cracking the lineup is extremely difficult for unknown performers, Ed added.

We'll close this week's blog with an emotional live performance by one of WIMG's typical artists,

Marvin Sapp, on the contemporary gospel tune, “Never Would Have Made It.” You'll find it here: