THE NEW MUSICAL BOX

BACK TO THE FUTURE

I've written extensively this year about the changing nature of the music industry - the challenges and the opportunities. The catalyst for these pieces was the fall and rise of HMV, a business which acted as a prism through which the UK's musical fortunes could be viewed. And like light shining through a prism, there are many colours and strands to that industry and the test will inevitably be, which ones will succeed?

HMV - 363 Oxford Street - 1960s

HMV could well be one of those survivors. Now owned by "distressed business" restructuring company Hilco, HMV have taken a lesson from Marty McFly with a step back to the future. Yesterday (Saturday 28th October) saw the reopening of HMV's spiritual home at 363 Oxford Street, a store originally opened in 1921 in the presence of Sir Edward Elgar but closed for this past 13 years. HMV had moved further down Oxford Street to a bigger store, partly to contain an ever-growing Aladdin's cave of wares - but also to heat up the competition with the then new Virgin Mega Store 500 yards or so down the other side of the road. The business collapse in 2012 saw retrenchment with dozens of store closures, a temporary halt to selling on-line and a major re-think of their raison d'etre. That re-think has seen a new focus on its core business - selling music. Yes, DVDs, T-Shirts and other peripherals will still be there but as Paul McGowan, Hilco's chief executive says

"The whole thing is about taking the business back to the music, back to the heritage... and that means having a presence on Oxford Street"

HMV 363 Oxford Street - Reopening after 13 years 

The refurbished store sees an increased focus on music, including a wider range of vinyl and critically, the whole second floor being given over to a performance stage with top of the range sound systems. HMV is about music and music events, performances, signing sessions and all the things that on-line retailers and download sites can't do. And as far as the store fascia is concerned, there is a suitably retro look to it as if to underline that the excesses of recent years are now over. 

Will it succeed?

Well - there are still many folk out there who believe that HMV no longer exists at all, a notion not aided by lazy print journalism which lumps it in with the High Street stores that succumbed to obliteration in the bow-wave from the financial downturn. In fact, there are still over 150 stores in the UK, a handful in Ireland and over 100 in Canada - which makes it (probably) the largest "traditional" music retailer in the world. The music business has proven to be resilient and I suspect that for some years to come, there will be a market for tangible products, rather than simply relying on streaming or downloading services. Indeed, quite apart from the continued increase in vinyl sales last year, some artists and indie labels have started issuing mix-tapes on audio cassettes appealing, one suspects, to those those of us who experienced the fun of making their own tapes back in the 70s and 80s. 

HMV and the other surviving record stores will always be up against it when it comes to price and choice, but as long as they focus on their strengths, then they'll be around for some years to come. And as HMV's McGowan adds, "....there's no vinyl in Tesco".

In the next blog, it's crystal ball time.  I'll be taking a look at the streaming services such as Spotify and seeing how they're starting to reposition themselves to combat the perceived threat of developments such as the launch of i-tunes radio and the continued expansion of You Tube and Vevo.

See you then.

Alan Dorey

29th September 2013