This decline is surely further evidence that diminishing returns in the once high value creative goods sector, that made up of products such as books, music, DVDs and computer games sales remains a serious problem, having already contributed to the decline of the store formerly known as Virgin Megastore, Zavvi and Woolworths in the UK. Competition from internet distributors of physical media such as Amazon has been one problem, and internet distribution via download another. Media can also store more nowadays and that has further driven the real prices consumers are willing to pay down. Physical shops that consumers actually have to visit are at a real disadvantage in this industry as browsing is not always necessary and items can easily be posted or sent digitally. As an example of the falling value of production in the industry, a long-playing album in 1968 cost around £2, which equates to around £25.99 in 2008 pounds using the Retail Price Index. Today its possible to download an album from Apple's iTunes, which probably has more tracks, for £7.99. iTunes' overheads are far lower as they don't have a distribution system or shop infrastructure to maintain, nor do customers have to spent time and money travelling there. It seems likely that the creative sector has a lot more pain ahead of it and pain which is not just a result of the present recession.
Thanks are due to measuringworth.com.