In the 20th century most record companies made money selling tangible products such as vinyl discs and CDs. You owned music by having a disc collection.
With the internet, music industries had to adapt as CD sales are falling each year. 'Product' is now bought online as single songs or albums exists only as an item on an iPod, mobile phone or computer.
- 1970- 8 Track
- 1980- Cassette
- 1990- CD
- Modern Music - MP3
In 2009, four men behind file sharing site Pirate Bay were sentenced to a year in jail and ordered to pay £2.5 million in damages for helping internet users to download music, films and computer games without paying for them. Additionally in 2009, 95% of the music downloaded online was done illegally.
HMV vs iTunes
Chief executive Simon Fox said within three years technology would become its single biggest product category ahead of both CDs and DVDs. There were plans to devote 25% of the floor space to MP3 players, tablets, computers and headphones as the CD goes the way of other defunct format as vinyls and tapes.
The headphone market is worth £150 million with Dr Dre Beats selling for more than £300 million - it is now worth £1 billion after being brought by Apple.
CDs have lost their value and status because once the reproduction and distribution of that commodity become effectively free, a commodity always depends for its status and it's value on it is relatively scarcity.