Atlantic Records Says Digital Sales Trump Physical CD Revenues

The moment where the MP3 has supplanted the CD as the music industry's centerpiece may have finally arrived, at least at Atlantic Records, where the company reported that digital sales accounted for 51% of its revenues. Atlantic is the first label to reveal that their digital sector — comprised of song downloads, ringtones and the like — outsold their physical CDs. "We're like a college basketball team on an 18-2 run," Atlantic's chairman Craig Kallman said in an awkward, failed sports analogy. All told, Atlantic's parent company Warner Music Group saw their digital revenues rise by 39% to $639 million in the previous fiscal year. Making Atlantic's digital achievement even more stunning is the fact that their biggest album of the last year and a half, Kid Rocks Rock N' Roll Jesus, wasn't available via top digital retailer iTunes and was only recently available on Rhapsody. So does this mean that record labels are finally adapting to the ever-changing industry? "I think we've figured it out," said Julie Greenwald, president of Atlantic Records. "It used to be that you could connect five dots and sell a million records. Now there are 20 dots you can connect to sell a million records."

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Song Stories

“Smells Like Teen Spirit”

Nirvana | 1991

"Smells Like Teen Spirit," named after a brand of deodorant marketed to girls, was Kurt Cobain's attempt to "write the ultimate pop song," he said, using the soft-loud dynamic of his favorite band, the Pixies. Cobain "had that dichotomy of punk rage and alienation," the song’s producer, Butch Vig, told Rolling Stone, "but also this vulnerable pop sensibility. In 'Teen Spirit,' a lot of that vulnerability is in the tone of his voice." Sadly, by the time of Nirvana's last U.S. tour, in late '93, Cobain was tortured by the obligation to play "Teen Spirit" every night. "There are many other songs that I have written that are as good, if not better," he claimed.

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