HMV administration and decline of CD sales

Foley

Foley

Level: Colin Harrington
(260 Apps, 30 Gls)
L1: Reaction Apprentice Season Ticket Holder South Stand Lower Fan
I didn't realise the impact of HMV going into administration on CD sales.
I always try to go into Independent record shops to buy 'real music products. Went into one today to get the new Steve Mason CD.
The shop has received virtually no new music this year 'due to HMV being in administration'
I really should use something like Spotify, but still like buying the traditional vinyl and CDs. This could hasten the end of this type of music platform I guess. Shame.
 
I too like physical media. Since I back stuff up anyway, I might as well buy it that way to start with. I have in recent years had a policy of buying stuff of a band's website if possible. They get to keep more of the money. I can't remember the last time I went into a physical shop to buy any music that is easily available (although I have been known to pop into an actual record shop on RSD or to look through second hand stuff - not that the latter benefits the artists mind you.) - it's all online purchases for records and CDs for me really.
 
I buy rare soul & funk on original vinyl releases... have done since I was 12 or 13 yearsold

shame was the advent of the big chain 'record' shops which more or less marked the demise
of local record shops ( Russel Acott in high street Oxford were a proper goldmine for vinyl until they closed in the 80s)
now the advent of the internet has obliterated the chain stores that used to specialise & offer cds/dvds and occasionally even vinyl

there are a few record shops left in the uk..... a once huge industry wiped out by Simon Cowell and his cohorts
pedalling uninspired rehashed reworkings by talentless nobodies via Saturday night tv for the dumb and even dumber

there are exciting new bands and acts still out there, still making original music, these days you really have to make an effort to seek them out , of course that means going to small, local live gigs, with the proverbial one man and his dog also in attendance, instead of spending all your time on social media and shutting out the real world
 
How vulture funds took millions out of HMV

Between 2013 and 2017, HMV reported earnings before finance cost, depreciation and intragroup expenses of £61.5 million.

Some £48 million of this is accounted for by what the company calls “non-trading intragroup expenses” i.e. services bought from other entities controlled by Hilco.

HMV states that the £48 million related to things like licensing agreements, property and management services.

The taxable profits have also been further reduced by interest charges of £10.3 million payable to various related parties and banks.

Altogether, nearly £58 million has been extracted from HMV by its owners and banks which financed the debt and operations of HMV.

Hitting Innocent Stakeholders

HMV made its £61.5 million profits by using the social infrastructure funded by taxpayers, but has not paid a penny in UK corporation tax.

Such a state of affairs is permitted by the current laws. On tax, Hilco states: “We do not engage in planning schemes or arrangements that we consider could be perceived as being aggressive or artificial in nature”.

HMV’s most recent accounts for the year to 30 December 2017 show borrowing of £19.5 million, mostly from related parties and banks. They are likely to fully recover all of this from the sale of assets.

Around £51 million is owed to various suppliers, including £5.2 million to HMRC for PAYE and National Insurance contributions. As unsecured creditors, they are unlikely to recover anything substantial from the bankruptcy of HMV.

There has been a huge transfer of wealth from employees, taxpayers and suppliers to vulture funds controlling HMV.

The £51 million obtained from unsecured creditors enabled HMV to build its assets, which will ultimately solely benefit its shareholders and related entities, functioning as secured creditors.
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Foley said:
I didn't realise the impact of HMV going into administration on CD sales.
I always try to go into Independent record shops to buy 'real music products. Went into one today to get the new Steve Mason CD.
The shop has received virtually no new music this year 'due to HMV being in administration'
I really should use something like Spotify, but still like buying the traditional vinyl and CDs. This could hasten the end of this type of music platform I guess. Shame.
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The only time I buy CDs now is at a gig (such as the Overload from last night at The Wheatsheaf). And they basically never actually get played, but go straight into my iTunes.

I buy vinyl for certain “special” releases (the new Lost Under Heaven album, boys and girls).

How is the Steve Mason album? I’ve been planning on giving it a “spin”…
 
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Steve Mason ex Beta Band? (and, before that briefly the drummer with mod revival band Knave?)

if thats the Steve Mason(?) .... he has a solo album out now.... pre Beta Band he was based in Oxford for a summer,
Steve has an impressive collection of vintage Lambretta scooters, while in Oxford he hung out & rode with Oxford Road Runners scooter club

spookily, for my day job Im the process of setting up an interview with him (Steve), following a profile on Griffiths Management / Records (which Steve is on the books of)
 
Sarge said:
Steve Mason ex Beta Band? (and, before that briefly the drummer with mod revival band Knave?)

if thats the Steve Mason(?) .... he has a solo album out now.... pre Beta Band he was based in Oxford for a summer,
Steve has an impressive collection of vintage Lambretta scooters, while in Oxford he hung out & rode with Oxford Road Runners scooter club

spookily, for my day job Im the process of setting up an interview with him (Steve), following a profile on Griffiths Management / Records (which Steve is on the books of)
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The same
 
mariokempes said:
The Overload are bloody awesome.
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Indeed they are. Saw them for the first time last night. I love how Arthur Joe stalks the stage. Proper front man. And reads his lyrics off printed sheets in the style of a certain Mark E. Smith.

Also, on the topic of this thread, they have no music online whatsoever, apart from a couple of YouTube videos. The CD I bought last night is a full album, to boot.
 
makv said:
Indeed they are. Saw them for the first time last night. I love how Arthur Joe stalks the stage. Proper front man. And reads his lyrics off printed sheets in the style of a certain Mark E. Smith.

Also, on the topic of this thread, they have no music online whatsoever, apart from a couple of YouTube videos. The CD I bought last night is a full album, to boot.
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It's the venom he spits the lyrics out with that I like
 
Sarge said:
there are a few record shops left in the uk..... a once huge industry wiped out by Simon Cowell and his cohorts
pedalling uninspired rehashed reworkings by talentless nobodies via Saturday night tv for the dumb and even dumber
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Whilst I definitely don't want to be the guy that defends Simon Cowell for anything......

......surely the demise of the record store is more Steve Jobs' fault?
I mean the problem is not people buying crap CDs, it's people buying no CDs at all because there's a more convenient medium to listen to their music.

And yes, an MP3's sound quality is inferior to a CD.....but if you're into music enough to be caring about sound quality first and foremost, then you're surely likely to be buying vinyl? And the surviving independent record stores are sufficient to cater for that market niche.....I'm not sure how many people ever headed to HMV or their ilk to buy vinyl......
 
tonyw said:
Whilst I definitely don't want to be the guy that defends Simon Cowell for anything......

......surely the demise of the record store is more Steve Jobs' fault?
I mean the problem is not people buying crap CDs, it's people buying no CDs at all because there's a more convenient medium to listen to their music.

And yes, an MP3's sound quality is inferior to a CD.....but if you're into music enough to be caring about sound quality first and foremost, then you're surely likely to be buying vinyl? And the surviving independent record stores are sufficient to cater for that market niche.....I'm not sure how many people ever headed to HMV or their ilk to buy vinyl......
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Fair comment
 
tonyw said:
Whilst I definitely don't want to be the guy that defends Simon Cowell for anything......

......surely the demise of the record store is more Steve Jobs' fault?
I mean the problem is not people buying crap CDs, it's people buying no CDs at all because there's a more convenient medium to listen to their music.

And yes, an MP3's sound quality is inferior to a CD.....but if you're into music enough to be caring about sound quality first and foremost, then you're surely likely to be buying vinyl? And the surviving independent record stores are sufficient to cater for that market niche.....I'm not sure how many people ever headed to HMV or their ilk to buy vinyl......
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Jobs? It was much more Spotify that disrupted the existing model so much, and 5 years or so before Apple got involved with streaming. ITunes of course allowed purchases, but it was streaming subscription services which pulled the rug from under the physical sales.
 
SteMerritt said:
Jobs? It was much more Spotify that disrupted the existing model so much, and 5 years or so before Apple got involved with streaming. ITunes of course allowed purchases, but it was streaming subscription services which pulled the rug from under the physical sales.
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If you look at CD sales, they peaked in around 2000 and then began to tail off quite sharply by ~2003-4.

That's because at that point the MP3 player/iPod market was beginning to grow and people were starting to listen to their music via MP3 downloads.

Sure that accelerates even more in the late 00s when Spotify (founded 2006) and other streaming services get in on the act - but the downward trend for CDs had already started by then.
 
tonyw said:
If you look at CD sales, they peaked in around 2000 and then began to tail off quite sharply by ~2003-4.

That's because at that point the MP3 player/iPod market was beginning to grow and people were starting to listen to their music via MP3 downloads.

Sure that accelerates even more in the late 00s when Spotify (founded 2006) and other streaming services get in on the act - but the downward trend for CDs had already started by then.
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Yeah true, but Jobs didn't invent anything, the MP3 boom was started by Napster, iTunes store didn't start until 03/04? In fact, as is typical for Apple, they didn't even write iTunes, but absorbed a smaller company. What iTunes did was make it easier for the mass market for sure. But I'd suggest that piracy enabled by the Internet and the original Napster pushed the record industry towards the MP3 and streaming in an attempt to combat piracy.
 
SteMerritt said:
Yeah true, but Jobs didn't invent anything, the MP3 boom was started by Napster, iTunes store didn't start until 03/04? In fact, as is typical for Apple, they didn't even write iTunes, but absorbed a smaller company. What iTunes did was make it easier for the mass market for sure. But I'd suggest that piracy enabled by the Internet and the original Napster pushed the record industry towards the MP3 and streaming in an attempt to combat piracy.
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I think this is crucial - Apple did what they almost always do.....they took something that other companies were already doing, packaged it up and made it prettier and easy-to-use, and as such accelerated adoption massively.

We'd probably have got to ubiquitous adoption anyway eventually - but I suggest that without the iPod, the MP3 player would probably have been confined to the early adopters (who were already using Napster) for a lot longer........
 
tonyw said:
I think this is crucial - Apple did what they almost always do.....they took something that other companies were already doing, packaged it up and made it prettier and easy-to-use, and as such accelerated adoption massively.

We'd probably have got to ubiquitous adoption anyway eventually - but I suggest that without the iPod, the MP3 player would probably have been confined to the early adopters (who were already using Napster) for a lot longer........
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Yeah that's fair enough, I don't think they sowed the seeds of the downfall, but they certainly helped the change to grow.
 
My problem with digital downloads is threefold.

Firstly, without a physical copy of what you have purchased, you are relying on the company you purchased it from keeping going. I still have LPs I bought when I was 14 years old - and that was a bloody long time ago. In that time, record labels/shops/bands/radio stations/formats/my computers etc etc have all come and gone. I still have the music to listen to.

Secondly, the artists get an absolute pittance for Spotify downloads/plays. An absolute pittance. It's Spotify that make the money through advertising and sales of their app. I don't know (but suspect!) that iTunes is somewhat similar.

Thirdly, it has changed the artistic nature of music. An album was (in the better cases) a considered sequence of songs. Some might be immediate 'likes', others might take a few listens to 'get' - and quite often it was the more obscure tracks that became my favourites. In a culture where you just down load the 'hit' choonz from an 'album' not only is the sequence lost, but some of the more rewarding tunes end up being not listened to.
 
ZeroTheHero said:
My problem with digital downloads is threefold.

Firstly, without a physical copy of what you have purchased, you are relying on the company you purchased it from keeping going. I still have LPs I bought when I was 14 years old - and that was a bloody long time ago. In that time, record labels/shops/bands/radio stations/formats/my computers etc etc have all come and gone. I still have the music to listen to.

Secondly, the artists get an absolute pittance for Spotify downloads/plays. An absolute pittance. It's Spotify that make the money through advertising and sales of their app. I don't know (but suspect!) that iTunes is somewhat similar.

Thirdly, it has changed the artistic nature of music. An album was (in the better cases) a considered sequence of songs. Some might be immediate 'likes', others might take a few listens to 'get' - and quite often it was the more obscure tracks that became my favourites. In a culture where you just down load the 'hit' choonz from an 'album' not only is the sequence lost, but some of the more rewarding tunes end up being not listened to.
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Absolutely true. All of that.
I feel lucky to have brought albums with interesting sleeves, discovering tracks you would never normally hear.
But.... I guess in 20 years there probably won't be record stores and maybe not even CDs. But shame but 'progress'
 
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