From a Rolling Stone item about how AC/DC might sell its next album exclusively through Wal-Mart:

…[T]he chain sold close to a million AC/DC discs last year, representing 60 percent of all of the band’s 2007 sales.

That suggests the band sells 1.6 million CDs a year—and suggests further that not everyone in the music industry is starving during the downturn.

p.s. Something I noticed on a recent Billboard Boxscore: The Kenny Chesney touring juggernaut continues.  At a recent single show at Heinz Field in Pittsburgh, with Keith Urban and Leann Rimes, Chesney grossed just over $4 million.

Update:  A couple of interesting comments:

1. Clambeard July 7th, 2008 7:27 pm

   I went into an AC/DC frenzy last year and bought about 5 or 6 of their cds (not at Wal-mart, I must add!). Other than my love for the band, I was motivated by the sale price of $6.99 per cd. That their cds are often on sale and are usually quite cheap maybe is a lesson for the music industry that will surely go unheeded.

2. Andy Price July 7th, 2008 10:39 pm

   It probably helps that they’re not available on iTunes, right? Though their absence may explain why they’re still selling physical CDs, it doesn’t explain why Wal-Mart is selling more than half of them!

That’s a good point about CD prices—more here, specifically about what Wal-Mart has been twisting the majors’ arms about on pricing. It’s another example of how the world has changed. Back in the day, when back catalog on a particular band began to demonstrate long-term legs, the labels would raise the wholesale price.

I don’t know if AC/DC’s not being on iTunes really matters; the band’s songs are certainly available on the file-sharing networks. Hitsville has an, ahem, friend who recently pulled down the band’s entire catalog off a bit torrent network in just a few minutes.

————–

For geeks only, here is a two-part case study in how this process used to work, back when I reported on these issues regularly in the Chicago Reader:

 H I T S V I L L E
Record Prices Rise Again  

Author: Bill Wyman Date: September 30, 1994

The leaves are beginning to turn, the holiday buying season is approaching, and the fancy of a strapping young international record conglomerate is turning to–raising record prices.
Reprise, Neil Young’s record company, has been taking full-page ads out in Billboard, announcing in mock horror that he’s refused to promote or tour behind his new album, Sleeps With Angels. But WEA, the distribution arm of Warner Brothers, which owns Reprise, is getting its own back with a $17.98 list price, up one dollar from the $16.98 list that has characterized big-artist releases over the past 18 months or so. (These and all prices below are for compact discs.) Similarly the Eagles, buoyed by the agreeably ovine response of consumers toward their $100-plus concert tickets, will see a similarly priced sticker on their upcoming Hell Freezes Over reunion album on Geffen. A forthcoming Aerosmith greatest-hits package (also on Geffen) will carry the same list–which is even sleazier seeing as how the band didn’t actually have to record anything for it.
These releases will certainly be joined by others as the Christmas season looms. Price-increase cycles in the industry have always worked this way: so-called “superstar” releases soften up retailers and consumers, and then most new releases up their prices to the new standard, and then catalog titles continue the trend. The major labels are assisted in this almost annual ritual by two factors: one economic, one social.
The economic factor is that consumers don’t really pay list prices. A dollar increase in list price actually translates to about a 50-cent increase in wholesale price to retailers; that’s the increase that eventually affects the price consumers pay. But trade magazines and retailers list prices in order to avoid a bald statement of wholesale costs. In very rough figures, a $10 wholesale price equals a $15.98 list, $10.50 a $16.98 list.
Accordingly, the wholesale price to Chicago’s Tower Records is just under $11 for the new Neil Young album. The store’s record sales manager, Joe Kvidera, notes that a year ago $16.98 was reserved for the Madonnas and Garth Brookses of the world. “Now, anything with any chance of selling is coming out at $16.98,” he says. “That used to be the ’superstar’ price. Now there’s a new supersuperstar pricing [$17.98]. And yet consumers are being told that prices are coming down because retailers are taking a loss.” Kvidera is referring to the price war between traditional retailers like Tower and Rose and your Best Buys and Circuit Citys, which often sell below wholesale price.
The social factor is the linchpin of the record companies’ strategy. Simply put, when fans of a particular artist want a new album, price just isn’t an object. Hence the “superstar” strategy. It should be noted that there are a lot of groups who’ve kept their prices down. The Offspring, proudly punk and proudly indie, have a top-ten record with a $14.98 list price. Green Day’s Warner debut has a $15.98 list. Peter Gabriel has a new double live CD listing for $19.98. But for dozens of other groups whose fans the record companies figure will take it, it’s been $16.98 for the past year: Soundgarden, Stone Temple Pilots, Nine Inch Nails, the Rolling Stones.
“People still buy it,” notes Kvidera. “If they want the new Pearl Jam, they’re going to buy it.”
Hitsville was surprised at the mention of Pearl Jam–wouldn’t the band, currently involved in a holy war with Ticketmaster over concert-ticket prices, be at the forefront of keeping record costs reasonable? “We’ll see,” shot back Kvidera. The source of his cynicism: the list price of the band’s records, both the recent Vs. and the 1991 debut, Ten, is currently $16.98. (Nirvana’s Nevermind, released the same time as Ten, remains at a $13.98 list.) What’s up with that? “I didn’t know,” sighs Pearl Jam’s manager, Kelly Curtis. Worse, there wasn’t much the band could do. “We don’t have much control over it,” Curtis confesses. “And even if we did it’s still a problem, because the retailers will just sell it for whatever.”
Of course the bands’ royalties are set, so the record companies end up mainlining the extra cash that accrues with price increases. And since most of the acts involved are multiplatinum artists, that 50 cents per album turns into a lot of money quickly. Curtis promises Pearl Jam will bring the matter up when they meet with Epic in New York next week to discuss their upcoming third album. But he sighs again at the myriad ways the industry has for separating fans from their money: “We’re trying to take it one issue at a time.” Neil Young’s manager didn’t return a call for comment.
A final twist on industry pricing: Classical titles, like sound tracks, are traditionally priced a dollar more than those by top rock acts. But for Three Tenors in Concert 1994–the album chronicling the Pavarotti-Domingo-Carreras Dodgers Stadium gig–middlebrow classical-music fans are getting hit with a $19.98 list! “Traditionally,” Kvideras says, “record companies have said these are specialty markets; they had to charge more because they had less sales. On the other hand, their justification for the superstar artists is that more people want them, so they charge more for that, too.”

H I T S V I L L E
Interview With a Price Raiser
Author: Bill Wyman Date: October 21, 1994

Interview With a Price Raiser
More news on the CD price-increase front. Several weeks ago Hitsville noted that prices were going up: the Eagles reunion album and an Aerosmith greatest-hits set will list at $17.98, a dollar more than standard top-line pricing from the major labels. The labels are softening up consumers with much-anticipated arrivals at the start of a heated buying season; then, over the next year, as has happened with stultifying regularity in the past, rock fans will see prices go up across the board. No better example of this soak-the-fans mentality can be had than the upcoming No Quarter, the Jimmy Page-Robert Plant reunion album, due out from Atlantic soon, which will carry a $19.98 list price. Chutzpah on this scale is almost unprecedented: the only other single album on the market with a similar price is the latest Three Tenors CD (the Domingo-Pavarotti-Carreras Dodgers Stadium souvenir), and part of its excuse is the time-honored one-dollar surcharge on classical and sound-track albums. No other non-special-edition rock album has come out above $17.98; by way of comparison, Peter Gabriel is charging $19.98 for a two-disc live set.
In that previous column Hitsville went out of his way to rap Neil Young’s new album for its $17.98 list price. It turns out the album is not guilty of the charge; it’s a standard Warner $16.98 release. At the time Billboard had the record down at $17.98; this was confirmed by a local retailer; and neither Young’s management office nor reps at WEA, the Warner distribution arm, returned calls. I couldn’t find the root of the misinformation; at any rate, retailers now say the record had a wholesale price that translates into a $16.98 list, which is what Billboard now says as well. My apologies.
One of the problems with covering this subject is that the officials involved, as a rule, won’t make themselves available for comment. Through the intercession of Pearl Jam manager Kelly Curtis, Epic chairman David Glew agreed to chat. (Epic and Columbia are the main imprints of Sony Music.) What follows is a pretty good estimation of the labels’ side of the story; readers can make their own decisions. I asked Glew specifically about the increase in the price of Pearl Jam’s Ten: it came out at a $13.98 list three years ago but since has adopted a top-of-the-line $16.98 list. How can the label justify such a large increase in a catalog album?
“A lot of album prices stay down,” Glew said. “Most labels have budget lines: Best Buy, or Nice Price. Why doesn’t that get reported?”
Still, Hitsville said, that doesn’t justify raising prices on Ten.
“Look,” Glew replied. “Industry prices were lower at that time. At your paper, advertising rates were a lot lower than they are today. You don’t understand the dynamic of the business. Some companies make money and some companies don’t make money. As a business we have to make price increases regularly.”
Yes, Hitsville said, but not only do companies like Sony make money, they make more money every year.
“That’s not necessarily true,” Glew replied.
Has Epic had a bad year over the last five years?
“Epic’s done very well because I run a great company,” Glew said. “That’s the whole key. You’re focusing too much on price. My job is to develop careers and I’ve been doing it a long time. That’s my job: to break artists in the record business today.”
Does Glew hear many complaints from consumers?
“There’s always a certain amount of opposition,”
he said. “But what’s been the number-one album the last month?”
The Lion King sound track–which lists at $18.98.
“And they’re selling as many as they can make,” Glew said.
In other words, consumers aren’t complaining where it counts.