What are the disadvantages and advantages of digital distribution for recording labels in terms of economics?
What will be an ideal response?
A disadvantage of economics is that consumers tend to buy individual songs priced at $0.69–$1.29
online as digital downloads, which are far less costly than $15 albums with nine or more songs that
dominated purchases in the CD era. A benefit for the recording labels is that they get a higher
percentage of the consumer spending in digital than with physical product. The other major advantage
of digital is the elimination of manufacturing and shipping expenses.
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