Product Life Cycle of Compact Disc

Though the projections for the fall quarter look promising the resurge us of books and CD’s is unlikely. Recent reports have sales of books falling as much as 34% over last year and the increase of eBooks over 300%. (Wolman, 2011) It also has CD sales being cut in half over the past decade. The rise of people buying digital music and streaming music is significant.

Retail spending on discs remained strong, indicating that physical and digital formats will continue to coexist in the marketplace. While overall disc unit sales were down 6 percent form the previous year, sales of movies and TV shows on Blu-ray continued to offset the decline in DVD sales. Sales of Blu-ray disc grew by 7 percent and accounted for 20 percent of total disc sales, up from 18 percent the previous year (Consumer Report 2013)

Consumers have shown an increasing preference for digital versatile disks (DVD). If, at the same time, more factories make these, what should happen to the equilibrium price and quantity of these?

Most of a CD consists of an injection-moulded piece of clear polycarbonate plastic. During manufacturing, this plastic is impressed with microscopic bumps arranged as a single, continuous, extremely long spiral track of data circling from the inside of the disc to the outside. Once the clear piece of polycarbonate is formed, a thin, reflective aluminum layer is put onto the disc, covering the bumps. Then a thin acrylic layer is sprayed over the aluminum to protect it, and the CD label is printed onto the acrylic. The compact disc was first used for audio storage only, but are now used to store audio, video, text, and any other information in digital form, and are able to hold 783 megabytes in all.

In other words, the MP3 format was born. “The MP3 compresses digital audio files by a factor of 12 to a size that can be easily sent from computer to computer without compromising quality.” By July 1989, a computer hacker that goes by the name of “SoloH” stole the sound codec off an unprotected server, and then extracted this dedicated audio layer so the entire world could use this format. In 1997, Tomislav Uzelac invented the first successful MP3 player, the AMP MP3 Playback Engine. Two college students, Justin Frankey and Dmitry Boldyrev integrated the AMP player into a Windows computer operating system, which yielded Winamp. Due to their creation being successful, Winamp eventually was available to the public for no cost. This right here is what sparked the digital music industry for some, and for others inevitably killing it right off. In a web article written by Kabir Sehgal of CNBC, the following quotation talks about Stephen Witt’s novel “How Music got Free”, on how Bernie Lydell Glover used MP3s as fuel for the fire and has been titled as:

MP3 is an audio format that allows users to compress and send music files easily over the Internet. The major problem with this music sharing is that most of the files are pirated, which has caused a stir in the music industry. Music companies and music artists have been complaining about how their music is being stolen and therefore lowering their album sales. The major blame has been put on Napster and other file sharing software available on the Internet.

In September 1976, the joint venture CBS/Sony Records Inc. presented the market with the revolutionary compact disc (CD) and began producing the disc in America in 1983. After joining Bertelsmann AG, Sony eventually acquired BMG’s stake in 2008, and began functioning as a wholly owned subsidiary. In July 2012, Sony/ATV Music Publishing purchased the publishing rights of the EMI group, which strengthened Sony’s position as the world’s largest music publisher.

Thanks to MTV, many new styles were born and they are what defined the community. Such as wavy hair styles, leather, slicked back hair, etc. All of these styles had larger to smaller effects on pop culture. One of the many items that started being used, and is still widely used today, was the compact disc, or better known as the CD. With music packed into each little disc, people couldn’t get enough of it.

Billy Joel released his 52 Street, the first CD released in the world, and began the launch of sales of the standard Compact Disc (CD). The 80s quickly became the most explosively successful decade in recording audio history due to the rapid replacement of tapes by consumers. The music industry continues to rise with the birth of the MP3 in 1990 followed by the introduction of the first major audio service by RealAudio. This form of obtaining music immediately skyrockets with popularity.

The Internet has transformed the music industry. Sales of CDs in retail music stores have been declining while sales of songs downloaded through the Internet to iPods and other portable music players are skyrocketing.

45% of recorded music sales came from record stores and 53% from other channels such as mass merchants, Amazon.com, and mail order in 1999 at the peak of the CD era. Digital music market was not a real factor yet. Years later, the distribution landscape has been changed into the delivery formats. Physical format (mainly CDs) and digital downloads or streaming services became two main ways of distribution to the marketplace. Digital music became a key channel for distribution since the early 2000s. Apple launched iTunes online store in 2003, and it changed everything.

An environmental factor that is currently impacting the vinyl industry is the sociocultural segment. Vinyl is trending right now among younger generations. More specifically being made for fans of the indie genre. This article says that the trend is growing and there is no telling how long it will last. If it continues to grow vinyl manufacturers are going to have a hard time keeping up, because right now it can take up to six months for them to make the vinyl. A lot of millennials are now moving to streaming music from their phones. There are a plethora of applications for smart phone that make music easily accessible. The chart blow shows vinyl sales from 1973-2014.

Optical Recording Corporation (ORC) was established in 1984 with the main purpose of capitalizing on the technological innovation of James T. Russell. Russell’s new technology was based on his recent invention that revolutionized recorded music storage devices. Although Russell was not the first to come up with the concept of the Compact Disk (CD), he was among the first people to patent this technology. By 1985, Russell held over 25 patents in 7 countries across the world to various technologies related to optical recording and playback. Russell's intellectual property was purchased by ORC in Toronto in 1985, the firm then proceeded to notify a number of CD manufacturers that their CD technology was infringing on

By mid 1980’s, the compact disc had taken over. In 1982, Japan invented the CD and it only took less than a year for it to arrive in America. The first American CD recording release was Billy Joel’s “52nd Street” and people preferred the CD recording over vinyl and cassette for a reason (Amale16). Like technological advances have shown for any other market, it proves to be also correct for the music industry – they improve and change, because they are, for the majority, better! The quality of the recordings on CDs were superb compared to vinyl’s or tapes, they were even more compact and space saving, and plus you could even store more memory (time/songs) on one disc. And this is why it only took America three years for CDs to overtake LPs in the music-recording market.

In 2000 the digital music was the next big thing in how consumers listen to music. The technological shift in music changed how the relationship is between the artists, recording companies, promoters and music stores on how they operate today. In the late 90’s and early 2000’s Peer-to-peer (P2P) networks allowed free exchange of music files with companies like Napster and Kazaa was a big step that allowed consumers to store large libraries of music. With the cost of hard drive space going down; it allowed for pocket-sized computers to store more information in a smaller space that open the door for apple to step in with the unveiling of the iPod and iTunes. These systems made it possible for storage and playback that gave consumers the