Record high
Music on vinyl has been coming back for years, and production is ramping up. So why are the prices getting so crazy?
The breaking point, for me, was $64.98 for the new Queens of the Stone Age album.
Granted, it was a deluxe, limited-edition double-vinyl version of last year’s Villains with 14 art prints tucked into the gatefold packaging and an “alternate etching” on Side 4 — and, to be fair, Matador Records has a $35 vinyl version of the record out there, too — but even this longtime record collector and superfan of Queens had to draw the line at dropping $65, before taxes, on a single recording.
That’s what one might expect to pay for a lower-end Queens of the Stone Age concert ticket or maybe a hard-to-find early pressing of one of the band’s previous records, not a new release that retails for $10.88 on CD through Amazon.ca.
Even $35 as a “cheaper” vinyl alternative would have seemed obscene just a few years ago. But as anyone who’s been buying or selling vinyl over the past few years is aware, $30 and up is increasingly the new normal for new LPs — at a time when new record shops are sprouting everywhere, vinyl plants are opening again for the first time since the CD drove the format to the brink of extinction during the 1990s, newer and more efficient presses are being developed for the first time in 30 years and sales of LPs have surged from a low point of less than one million units in the U.S. in 2005 to14.3 million pieces in the States last year .
In Canada, according to Nielsen Music’s 2017 year-end report, 804,000 vinyl records were sold last year, jumping 21.8 per cent from the 660,000 moved in 2016. Production capacity is up and more stock is being produced in ever greater numbers, so theoretically the cost of vinyl should be going down or at least holding steady, not going up. And yet . . .
“It does keep creeping up,” concurs Greg Davis, owner of College St. music shop Soundscapes. “Certainly, five or 10 years ago, between $15 and $25 was the range. Now, it’s $25 to $40 and a lot of things are in the mid-$30 range.
“People are, I think, being pickier in what vinyl they buy now because of that. If they see something that’s $40 and they see something else that’s maybe $25 or $30 they might forgo the more expensive vinyl, or if they don’t find something that’s cheaper they might forgo the vinyl and just listen to it digitally. So it does have the potential to affect vinyl sales if it gets too out of hand.”
Gerry McGhee foresaw the vinyl boom a few years ago while running online music distributor Isotope Records. He recognized an opportunity in the growing lack of pressing capabilities to meet demand and sagely ran with his convictions to open a new pressing plant, Precision Vinyl, in Burlington in early 2017.
Bolstered in large part by early commitments from Canada’s three major labels, Warner Music, Sony Music and Universal Music — and, soon after, their U.S. counterparts — Precision added a second eight-hour daily shift within six months of opening (which, he says, “is just insane”) and now occasionally runs a Saturday shift to maximize the potential of the five double-presses (or 10 pressing moulds) it’s running.
They would operate 24 hours a day if vinyl-press operators, a dying breed until just recently, weren’t so hard to find.
But if plans hold, they’ll add two to six more presses starting at the end of February, some of them new automated machines, to bring the plant’s capacity up from 240,000 units a month to “closer to, like, 500,000 a month.”
McGhee says he doesn’t see “peak vinyl” coming anytime soon. “I think we’re still on the crest of the wave, actually, going upwards.”
Recent, big-ticket runs have included 100,000 blue-vinyl copies of U2’s Songs of Experience and 250,000 picture discs of Taylor Swift’s Reputation that are headed far beyond the Canadian market, which typically demands modest runs of 1,000 to 5,000 pieces. It’s not unusual to press 30,000 to 40,000 copies of a new major-label release to meet North American demand.
Such increased production, combined with the fact Canadian record buyers can now buy records made in Canada and not in the U.S. or the Czech Republic and, thus, not subject to extraterritorial exchange rates and shipping costs and the like, means we “should start to see a savings coming through on that end.”
Labels aren’t completely oblivious to the fact they could price themselves out of the market with one too many $52.99 Beyoncé LPs, McGhee says. They are, perhaps, mindful that if they’re going to release a $45 “deluxe” Coldplay package for the superfans, they should also probably put out a $25 version with fewer bells and whistles for the commoner.
“Buyer fatigue has always been the main concern for us, at our end. And the labels have brought it up to me, as well,” McGhee says, which gives him some confidence that his clients are just trying to hit a price point where they can make some money off music again without completely alienating the customers they have left.
“I think that’s still the moving target. They’re trying to figure out where that is.”
Still, some retailers place the blame squarely on major labels for getting back in the vinyl game and milking it for all it’s worth as CD and digital music sales look increasingly shaky in a streaming age.
“All I’d do is bitch about the major labels gouging the retailers and, therefore, the customers,” offered one local record-shop proprietor who declined to comment on the record, adding vinyl is “too damn expensive” and the current state of things is “very frustrating” to anyone who has to sell it at increasingly marked-up prices to make a profit.
The aforementioned Queens of the Stone Age album came out at $35 and $65 on Matador, an independent label, however, so it’s clearly not just the majors testing the limits of what they can charge consumers.
But not everyone is jacking up their LP prices, either. Davis singles out Indiana indie Secretly Canadian (distributed through Outside Music domestically) as one label that has very diligently kept its titles close to the $20 mark through the new blackgold rush, only recently edging them up to $25 or $26, “which is still quite reasonably priced” in comparison to some of the titles going around.
On the same day last year, this writer purchased copies of Alvvays’ Antisocialites and Casper Skulls’ Mercy Works, both limited-run records on small Toronto independent labels — Royal Mountain and Buzz, respectively — for around $20. Yet I also dropped $34.98 on a copy of the Beaches’ Late Show later that afternoon. The Beaches are a Toronto band, as well, but their LP came out via major label Universal Music, which presumably would have the buying, dealing and production might to keep costs lower than an indie cranking out 500 copies of a new release at a time.
Why the discrepancy? One wonders if the recording industry is behaving a bit like the concert industry, pushing prices ever higher just to see what the market will bear.
Sony Music Canada politely remained mum when queried on why vinyl costs what it does today, while Warner offered a “Sorry, we don’t comment on pricing” through a spokesperson. Universal Music Canada president Jeffrey Remedios — who came up running Toronto indie imprint Arts & Crafts and is an old friend of the author — was a little more forthcoming.
“It’s a question of art versus principles of economics,” he emailed. “Yes, there is more vinyl manufacturing ca- pacity today thanks to places like the great new Precision plant, but (in my opinion) there remains more demand than current levels of supply. Generally speaking, manufacturing and raw material costs have not gone down. To add to the complexity, freight costs continue to rise and we are still dealing with a market where many releases are not pressed locally.
“In our streaming environment, music is access and consumptionbased, so what is the value of purchasing vinyl? Beyond the beautifully imperfect sound, vinyl is also a purchase of a sentimental artifact. For the artist, it’s a platform for greater complementary artistic expression. All that coloured vinyl, gatefold packaging and other special elements all drive the cost up.
“Like pricing coffee-table books, there is a wide variance. It is an imperfect pricing structure and certainly one that would benefit from multiple vinyl releases at multiple price points for different fans with different desires.”
Warnings that price hikes could burst the vinyl “bubble” have been coming for some time.
In 2013, for example, in a piece titled “The rising cost of new vinyl . . . or, shove your $30 Smiths reissues up your collective asses,” Record Collector News noted that “reckless cash grabs from a wounded industry are par for the course . . . Major labels notoriously blew it in the ’90s by killing the single as a format and outrageously overpricing CDs, which of course led to the downloading revolution and the crippling of an industry. Now that they’ve been given a chance to redeem themselves with the resurgence of interest in vinyl, not only are they shooting themselves in the foot, but it’s the same foot, the same gun and they’re even reusing the bullet.”
Stereogum in 2015 worried “Have we reached peak vinyl?” and pointed out that “the average vinyl LP grossed $23.84 last year in current (U.S.) dollars, based on RIAA data, up almost 40 per cent from an inflationadjusted $17.20 in 2005.”
“Let’s see: rapid sales increases. Rising prices,” the piece mused. “All for a product geared at a relatively small segment of consumers who will pay for a commodity, music, that’s generally available for less — or even, legally, for free — in other formats. It doesn’t take an economics whiz to see the makings of a potential market bubble. If it pops, some indie labels, stores and artists who helped foster the format during its lean years worry they could be collateral damage.”
Again, in April 2016, Forbes observed that “prices have jumped by as much as 75 per cent for new major-label releases since last summer after the major labels began raising prices on new releases last spring.”
Interscope/Universal was singled out for bumping the “suggested retail price” of three successive releases by Tame Impala from $19.99 to $24.99 to $29.99, and for releasing editions of Lana Del Rey’s 2015 album Honeymoon at $39.99 and $49.99.
“I haven’t seen pricing coming down. I have seen price increases, but definitely no decreases,” says Doug Putnam, president of the Sunrise Records chain, which recently expanded to 82 shops in all 10 Canadian provinces in an ambitious bid to capitalize on the slight upturn in physical music sales.
“I think the reality is we are 100 per cent going to see a pushback at some point, and is that point $39.99 or $34.99? I’m not sure where it’s gonna come, but I kind of think the sweet spot is around $29.99.
“From the retail perspective, the only benefit I see is that everyone’s at that higher pricing. And yeah, we have a chain, but look: The reality is, if the independents with one or two stores are struggling on the pricing, then it’s just that times 20 for me . . . If they’re getting complaints, we’re getting complaints. “And honestly, the customer doesn’t fully understand why the price is where it is.
“I’m not saying the retailer understands it, either. They’re kind of saying what I’m saying: ‘I don’t know why it’s 50 bucks for this, but it is.’ It’s almost like, ‘The reason it’s 50 bucks is that’s what we’re getting charged.’ That’s how it goes.”
Some of the biggest culprits are not new releases but catalogue titles — which, as Nielsen reports, accounted for 59 per cent of Canadian vinyl sales in 2017, “the highest percentage to date.”
Ed Sheeran’s newest album was the biggest overall seller at 4,900 units, but just behind it in the top 10 was a slew of albums that have already been bought on vinyl once, rebought on CD during the ’90s and now are being bought on vinyl again by people who got rid of their records for CDs just a couple of decades ago: Pink Floyd’s Dark Side of the Moon, the Beatles’ Sgt. Pepper’s Lonely Hearts Club Band and Abbey Road, and Bob Marley’s Legend.
Trevor Larocque, who runs both indie label Paper Bag Records and the east end’s Tiny Record Shop, finds the hikes on these titles the hardest to swallow — Beatles albums, in particular, recently jumped at least $5 or $6 apiece.
“These are Beatles records,” he says. “These records have been paid off one jillion times over. People are paying $34.99 for Revolver? These are records that are 50 years old. They’re mass-producing them for the world and they’re clearly getting a deal on them . . .
“Not to pick on the old-schoolers, but Fleetwood Mac’s Rumors? That’s between $32 and $34.99. We’re talking about Rumors, man. That record should honestly cost, like, no money . . . But they know that people are gonna buy it, that people want that record.”
Paper Bag typically sells new vinyl for $24.99 on its website, and those tend to be limited runs of under a thousand copies.
The price of manufacturing drops “dramatically” even when you crest the 1,000 mark, Larocque says, so if you’re pressing tens of thousands of something it does seem odd that the cost of, for instance, Reputation was such that he had to charge $42.99 just to make a small profit. Like his fellow record sellers, he knows some customers don’t know who to blame.
“I’ll charge $52.99 for the new Beyoncé record because it cost me $43.99,” he says.
“I want to carry it for somebody to own it, but I’d like them to realize when they come in and they see it listed at $52.99 that I’m not, like, cleaning out their wallet. It’s definitely not going to me.”
“I think the reality is we are 100 per cent going to see a pushback at some point, and is that point $39.99 or $34.99? I’m not sure where it’s gonna come, but I kind of think the sweet spot is around $29.99.” DOUG PUTNAM PRESIDENT OF SUNRISE RECORDS