Choices in music and all other consumption choices are usually influenced by consumer tastes. People’s likes and dislikes can shape demand, and a change in taste can change demand. Observing change in taste is very difficult, and is used after all other possible changes have been ruled out.
The major factor for shifts in demand for LPs is change in price expectations. For example, the price people pay for an Elvis Presley album. Not so long ago an album was sold for 20p,now buyers are willing to pay 20 British pounds for the same record. That price increase with time makes people increase their demand today. Music-lovers prefer vinyl because it is more authentic. The major artists such as the Beatles and Stones are a good investment according to insiders, also LPs are the main music formats for the majority of heavy-spending 15-to 24-year-olds. As CDs begin to outsell vinyl, its value rises. Original albums by artists such as the Beatles and the Rolling Stones are going up in price, as are works by Prince, Jimmy Hendrix and David Bowie. The climb in values comes as sales of new compact discs overtake LPs. A research by HMV Shop, which has 67 stores, shows that although CDs have been around since 1983, half of all CD-users began buying their discs in the last year.
Another factor for still the huge demand for LPs is that the supply is getting lower with time. This is due to the long-time ago edition of particular records by artists whose albums have garnered massive amounts of critical acclaim and are no longer produced or by artists who had already passed away like Tupac Shakur, Jim Morrison or Elvis Presley. People will buy their favorite artist’s record no matter at what price the record companies sell those albums. In this case the LPs’ market experiences the so-called market shortage --- an excess of quantity demanded over quantity supplied at a price which record stores give.
Change in demand for CDs is caused by the ‘’change in the price of related goods’’ factor. ‘’The LPs and CDs hold their value if the artists can play their instruments’’, Mark Hayward, owner of the London record shop Vinyl Experience, says. LPs turn from normal goods to luxury goods. Their prices are going up, because of their originality and collector’s value and still LPs fail to really connect with the young, teenager record-buying public nowadays, therefore, music-buyers turn to CDs, which are not so expensive, because of their re-edition for example.
The shifts in demand for both LPs and CDs, also depends on the changes in income of the potential customers and the rest is due to changes in taste. As long as people can afford to buy music, the choice between LPs and CDs will be only a matter of taste. Some prefer authentic and original albums of their favorite performers, and others prefer to buy an album on a CD, or even on a tape. For that group of customers is important just to have the album, no matter what the format is. In a way it is more suitable to own a CD or a tape, because they are more universal. One can listen them in a car, walkman or discman.
The LPs & CDs might be considered as substitute goods, the audiotape for example is to a certain extent a substitute in satisfying the desire of people to listen to music. Soon, with the fast developing technology, the mini-disc and DVDs (digital videodisc) will be wide spread, and also the mp3 players, which are available only on the Internet, for the time being. As soon as these players hit the market, the demand for CDs and vinyl will head downwards. This will be due to the improved sound quality of the digitally mastered mini-discs, and the fact that a person would be able to listen to 150 tracks, for example, instead of 15 as it is on a tape, CD or vinyl. People can listen to a song from a particular album and at the same time watch the video of the song on a DVD. But that of course depends on the price of the new technology. If the price would be acceptable, the buyers would be willing and able to buy a greater quantity of these products.
The music industry is a stable one. People will always by music and it is all the same what they buy CDs, LPs, tapes, mini-discs etc. The format strongly depends on the person and his taste, and less on all other factors for shifts in demand. Each has its own preferences and according to all the facts, there will always be a market for LPs, market for CDs and for all other formats music albums are edited on. Only if the price of any of these starts to fall down, the demand for it will increase more than the demand for the others (Law of demand).
The generalizations about the demand for LPs are not easily made due to the many factors affecting the shifts in demand. LPs are the pioneer format and many classics are only edited on LP, so the price does not really matter for collectors and true fans, and there will always be demand for LPs.
Appendix:
1) Economics
2) XXL Magazine (Rap Music Magazine)
3) Priority Records Web Page
