In news that may shock many of our readers and will certainly affect the career of many artists, news has just broken that popular music and DVD retailer, HMV becomes the highest profile high street store to collapse during the economic downturn.
Up to 4,500 employees may lose their jobs as the retailer is set to fall into administration tomorrow.
Thousands of jobs are at risk with the 90-year-old retailer after its board called in Deloitte as administrators following poor results over the crucial Christmas trading period, which is usually the busiest sales period for the retailer.
HMV has been struggling with debts for over two years, while banks have revised the terms of their loans. It was thought to have been handed a lifeline after its suppliers, including Universal Music, EMI, Warner Brothers and Disney, were handed shares in exchange for improved commercial terms.
However, those firms were said to have refused to agree to provide financial backing to the retailer, leaving it with few options to find the extra resources necessary to keep trading. The store’s website is still advertising a 25% off sale for thousands of products.
The chain first opened in 1921 on London’s Oxford Street and still owns the world’s biggest record shop there.
While digital online stores like iTunes and Amazon have become increasingly popular for music and DVD purchases, what does this mean for physical copies?
Film companies and record labels rely on its 247 stores for their sales. Despite its troubled position, the retailer still sells 27% of all DVDs and Blu-Ray discs and 38% of the physical music market.
So, it serves as a big concern for those artists and actors who are not such big sellers when it comes to the digital era we currently live in, meaning that physical sales make up a large portion of their sales.
While many people now live in the era of illegal downloads when it comes to a majority of the music on their portable music devices, some people still prefer to go out and buy physical albums of their favourite artist’s latest body of work, which includes the CD and album artwork booklet.
The news definitely generated a lot of disappointment from a large majority of Twitter users. UK rap stars JME and Professor Green expressed fears about the future of artists physical releases due to the breaking news:
Though digital retailers will still be available to purchase entertainment products (music, games, films etc.) there’s a slight classic feel that going to HMV or Woolworths (when it was open) had, when you went to collect the CD of your favourite artist’s album when its release date finally came around.
We want to hear from our readers how this news effects them, especially if you’re a new artist or just a music lover in general.
Do you feel this will have a negative effect on your favourite artists? Do many of or readers even purchase music legally anymore, with so many free online links to music available with on the Internet?
Let us know