Johnson's World: Of Plastic Lumps and Buggy Whips

In his book Vaporized, Robert Tercek asked the question, “Where have all the record stores gone?” His theme is that once-popular record stores and video rental stores are gone from the landscape: “vaporized” as he says, not only by new media but also by an entirely new delivery system that made the stores themselves obsolete.

The earlier transition from vinyl, long-playing records to compact discs did disturb the music industry, but it adjusted and continued with business as usual. The assumption was that one lump of plastic (CDs) could be sold as easily as another (records). The real product (music) remained unchanged.

Alas, things are seldom what they seem. The major change between record and CD was under the hood. The music was now being delivered in digital rather than analog format. Very few realized it at the time, but the digitization of music meant that eventually the lump of plastic would no longer be necessary. The subsequent rise of the Internet with ever-increasing bandwidth and connections in every home provided that last piece of the puzzle.

The pieces all came together with Apple's unveiling, in unison, of the iPod and the iTunes store. Suddenly the lumps of plastic were gone, and no plastic meant no need for stores. The record store market hadn’t been disturbed; it had been vaporized.

Back to the future

End of story… or is it? Those of us in business know that the story never really ends. Hurry back in time with me now 100 years. We’re in an automobile dealership, a Ford dealer to be exact. The Model T has been out for eight years, but mass production is really kicking in and the number of cars sold annually has ratcheted up to 300,000, a far cry from 10,000 in the first year.

Fuel injection, seat belts, and air-conditioning are nowhere to be found, yet otherwise the dealership looks eerily like those of today. Not much has changed in the way the new cars or automotive service is delivered.

In 1916 it seems everybody is buying a car, even though horse-drawn power is still common and will be for decades to come. At this time a cliché is born: the buggy-whip as a metaphor for obsolescence. We still hear this tired old saw from consultants. The implication, of course, is that the Model T doomed buggy whip manufacturers, and record and video stores should have learned from them.

Now travel in time with me once again. The year is 1990 or there-abouts. I’m staying at a friend’s house in Cali, Colombia. The weather is beautiful and I wake up early. It is garbage day, and garbage cans are lined up on the street just as in the United States. In a few hours modern trucks will carry away the refuse, just as in the USA.

Right now, at the break of dawn, the old junk man comes by to pick any resalable scrap metal out of the trash. In North American he would drive a beat-up pickup truck, but here in South American he has a horse-drawn wagon. Yes, and he has a buggy whip.

Three-quarters of a century after their demise was predicted as imminent, there remains a demand for buggy whips.

Now, back to the future. According to Nielsen, who tracks such things, 141 million music CDs were sold in 2014. A far cry from its pre-streaming heyday, but that’s still an awful lot of lumps of plastic. Guess what else? Record sales are steadily increasing, with 6 percent of all music sold in 2014 on vinyl. That’s double the year before. (Editor's note: Rolling Stones Records on the northwest side of Chicago celebrates its 45th year in business this year.)

I’m not suggesting that you sell the farm to enter either the buggy whip or the CD business. I am suggesting that there are opportunities in every situation.

Hats off to my cousin John Homberg, who was born right about the time the record album was rendered archaic by the compact disc. He is happily making a living selling turntables and vinyl records at a company called Music Direct. Like John, most of their employees and customers are post-Baby Boomers who view analog recordings as “retro” and high-end. Check out Music Direct online.

Oh, and be sure to request their printed catalog.