Chris Anderson, the fellow who coined the phrase “Long Tail” in 2004, has a great post on his blog about the current state of the music industry. The short of it: every part of the music industry except the sale of compact discs is up.

Here’s an overview from his post:

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* Concerts and merchandise: UP (+4%)
* Digital tracks: UP (+46%)
* Ringtones: UP (+86% last year, but probably just single-digit percent this year)
* Licensing for commercials, TV shows, movies and videogames: UP (Warner Music saw licensing grow by about $20 million over the past year)
* Even vinyl singles (think DJs): UP (more than doubled in the UK)
* And, if you include the iPod in the music industry, as I’d argue a fair-minded analysis would: UP, UP, UP! (+31% this year)

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It’s key to realize that the music business is NOT the same as the record business. This is a fundamental concept featured in one of the courses I’m teaching: The Future of Music and the Music Business, authored by Dave Kusek. People are more into music than ever, it’s just the revenue streams that are adjusting. Great time for entrepreneurs to be sure.

Instant Music

Oct 10 2007

I got this email first thing today:

THANK YOU FOR ORDERING ‘IN RAINBOWS’.

THE LINK BELOW IS YOUR UNIQUE DOWNLOAD ACTIVATION CODE.

PLEASE CLICK ON THE LINK OR CUT AND PASTE INTO YOUR BROWSER TO OBTAIN YOUR DOWNLOAD.
IF YOUR LINK APPEARS AS TWO SEPARATE LINES, PLEASE CUT AND PASTE THEM CAREFULLY INTO YOUR BROWSER.

THE ALBUM WILL COME AS A 48.4MB ZIP FILE CONTAINING 10 X 160KBPS DRM FREE MP3s.

IF YOU HAVE ANY QUESTIONS OR PROBLEMS DOWNLOADING YOUR FILE, PLEASE CONTACT OUR DOWNLOAD CUSTOMER SERVICE TEAM: downloadinrainbows@waste.uk.com

WE HOPE YOU ENJOY ‘IN RAINBOWS’.

Well, I do enjoy ‘IN RAINBOWS.’ Very much. And from what I can tell, there’s a whole lot of other folks that are enjoying this record today too. Nicci and I went down to Cambridge 1 for dinner (a hip pizza place in Harvard Square), and they were playing the record to a room full of folks there too.

Over and above anything else, this coordinated experiment shows that it’s still possible to build a huge buzz around a new record (not easy). Radiohead has succeeded in having many people hear their record for the first time, at the same time. If the new music business model involves using a discounted (or free) digital product to corral these folks into creating a word of mouth groundswell that can support a tour, merch, licensing opportunities, ringtones, etc, then it looks like they may have nailed it. They also have 6 other records (now available digitally for the first time on Amazon). Long tail anyone?