Long Live the Record Store

June 29, 2007 — -- Clark Benson, CEO and founder of the Almighty Institute of Music Retail, loves his CDs. For Benson, as well as many hardcore music lovers, perusing the racks at the local record store is an art, a pastime lost on today's younger generation of iTunes addicts.

It's a trend that distresses him and makes him wonder whether today's technology has gotten ahead of the music industry, something he's trying to bring attention to through his organization, which provides information to record labels and retailers.

"There is no question that there are less [sic] record stores now than there were five to 10 years ago … and that's OK," he told ABC News. "There doesn't need to be five record stores in every town or two in every mall, but what we don't want to see is the time when there are no places to go -- outside of Best Buy or Wal-Mart -- to buy music."

Even with dwindling CD sales, down 20 percent from 2006, and scores of record store closings, an average of 550 per year since 2003, Benson stresses that the health and future of the music industry rests on the shoulders of the pure-play music retailers.

"If the average record store can't stay open, it is really going to hurt the music industry faster than the music industry will be able to adapt to the digital medium," he said.

He recently wrote commentary for Billboard Magazine and warned the recording industry was too quick to shift its allegiance to the digital medium.

Getting rid of CDs and music retailers before new infrastructure and development methods are set up, he cautioned, will leave record labels with insufficient income to fund new, upcoming artists and groups, thus limiting their catalogues and narrowing the kind of music executives are willing to spend money to produce.

As it is now, Benson points out, there are several factors that are accelerating the demise of the CD store -- high prices, digital and big-box exclusives, packing too many album releases in the industry's fourth quarter, and overlooking collectors and audiophiles.

At $17 to $18.89 a pop, CDs are not exactly cheap, especially when compared to the $9.99 to $12.99 sticker price of most online albums. Increased costs turn off consumers as well as retailers, since high list prices mean record stores have to charge customers more in order to make a profit, thus deterring consumers from buying their CDs.