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Crossing the Pond

This is Celia Hirschman with On the Beat for KCRW.

Last week I visited London on business. I was curious to see how the music industry was fairing in another continent..

The United Kingdom music business has long been held in high esteem around the world. The quality of the artistry, dating back from the early 60s, profoundly helped shape the American music culture and conversely, American music has had a significant influence in the UK. But in spite of the shared love of music, the United States and the UK each operate with a different business model.

With the UK being a much smaller market, consumers are primarily influenced by a couple of important media outlets. Press has been and is still the main media vehicle with only a handful of music magazines in circulation. Even without significant radio airplay, bands receiving coverage in NME, Q, Mojo, Uncut or Dazed & Confused find their cds sell quickly in shops based on the exposure. In the US, print is important, but rarely is it the driver for sales. US media options in contrast are limitless, and because of this, their impact is diluted.

On the radio front, the UK is quite different as well. There are plenty of small college stations, but the radio stations of prominence are the three national BBC stations. In London, regional radio is more influential for music, with progressive radio stations playing a broad spectrum of styles. If you can-t get your record on one of the national or regional stations, you-ll try and build a following at college radio or at the rapidly re emerging pirate stations. Pirate radio became relevant in the 60-s and 70-s and faded in the 80-s. But it-s a growing business again in the UK. With no risk involved, these stations play whatever they want because they are broadcasting illegally.

Live music is extraordinarily vibrant in the UK, and similar to the US, is very significant for artist development.

At record store level, music retail is suffering just the same in the UK as it is in the US. I visited a number of record stores, and found them lacking key music and catalog. On top of that, there-s a serious problem on the horizon for labels in the UK. Some UK retailers are buying nationally released records from distributors outside the UK, due to the global pricing discrepancies. After all, if you can buy the same album, manufactured in Australia for half the money, why wouldn-t you? And how can the UK label compete with another market undercutting their margins? In the past, long term professional relationships and the threat of enforcing importing laws prohibited the sales, but since the record business is experiencing a decline, many rules no longer apply. On top of that, the recent union of European communities has brought a whole new economic reality to the record business. The effects of the EU union, coupled with a serious decline in cd sales, lower profit margins and high marketing expenses, has led many organizations to rethink their business strategies. Many small labels are closing their doors, and one of the more significant independent distributors shut last month.

On the downloading front, the UK is still waiting for a lot of major players. Napster and iTunes will be up and running shortly, and it will be very interesting to see how things develop in this market. Traditionally, the UK has embraced new technology quickly so one can only guess that music downloading will become a major component of the UK lifestyle.

Taking all this into stock, it seems like the UK is meandering along a similar path to that of the US as it relates to the music business. Unfortunately, everyone seems to be walking the same road, with the overriding question, where are we going?

This is Celia Hirschman with On the Beat for KCRW.

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