HMV looking at closing stores in Canada as music sales appear to be capital-D doomed
This manages to be even less surprising than the Blockbuster bankruptcy filing in the United States: according to The Daily Brew, HMV may be looking at closing some—or even all—of its Canadian stores. As sales of CDs and DVDs stumble, HMV’s search for other options hasn’t paid off:
The closures will likely be announced before an April test of its borrowing rules, which are expected to be tight. And, while the HMV Group will apparently seek to end its leases in shopping malls across Canada, an imminent exit altogether isn’t seen as likely.
HMV introduced a “store of the future” format three years ago, which was designed to make locations more browsing-friendly with an enhanced selection of books, electronics and video games. Computer hubs were also set up in some locations to encourage social networking, online research and on-the-spot downloading.
The problem for stores like HMV—and other music retailers—is that the music industry may be even more doomed than we already thought. The good people at Business Insider look at the last 30 years of data from the recording industry, and when the data is crunched, some troubling facts (and hilarious graphs) come out.
- When adjusted for inflation, the music industry is making less money than any time since the CD was introduced.
- When adjusted for inflation and population, revenues are lower than any time since 1973.
- People are spending about one-third as much on recorded music today as they did 10 years ago.
And there’s good reason to think all of these trends are going to get worse, not better. Basically, the music industry relies (or, perhaps, relied) on full-length album sales, and while iTunes has opened up some new money, it’s largely helped revive the single. The download hub hasn’t helped (and may have harmed) album sales.
HMV won’t be the first retailer to fold (remember Sam’s? Music World? A&A?), and with numbers like that, it probably won’t be the last.
• HMV considers closing Canadian stores this spring due to shrinking sales [Daily Brew]
• The REAL Death Of The Music Industry [Business Insider]
![](http://www.facebook.com/sharer.php?u=https://torontolife.com/culture/hmv-looking-at-closing-stores-in-canada-as-music-sales-appear-to-be-capital-d-doomed/&title=HMV looking at closing stores in Canada as music sales appear to be capital-D doomed&picture=https://torontolife.com/wp-content/uploads/2011/02/HMV.jpg&description=[caption id="attachment_56515" align="alignleft" width="282" caption="His master's void: profit gaps responsible for possible closures (Image: bm.iphone)"][/caption]
This manages to be even less surprising than the Blockbuster bankruptcy filing in the United States: according to The Daily Brew, HMV may be looking at closing some—or even all—of its Canadian stores. As sales of CDs and DVDs stumble, HMV’s search for other options hasn’t paid off:
The closures will likely be announced before an April test of its borrowing rules, which are expected to be tight. And, while the HMV Group will apparently seek to end its leases in shopping malls across Canada, an imminent exit altogether isn't seen as likely.
HMV introduced a "store of the future" format three years ago, which was designed to make locations more browsing-friendly with an enhanced selection of books, electronics and video games. Computer hubs were also set up in some locations to encourage social networking, online research and on-the-spot downloading.
The problem for stores like HMV—and other music retailers—is that the music industry may be even more doomed than we already thought. The good people at Business Insider look at the last 30 years of data from the recording industry, and when the data is crunched, some troubling facts (and hilarious graphs) come out.
When adjusted for inflation, the music industry is making less money than any time since the CD was introduced.
When adjusted for inflation and population, revenues are lower than any time since 1973.
People are spending about one-third as much on recorded music today as they did 10 years ago.
And there’s good reason to think all of these trends are going to get worse, not better. Basically, the music industry relies (or, perhaps, relied) on full-length album sales, and while iTunes has opened up some new money, it’s largely helped revive the single. The download hub hasn’t helped (and may have harmed) album sales.
HMV won’t be the first retailer to fold (remember Sam’s? Music World? A&A?), and with numbers like that, it probably won’t be the last.
• HMV considers closing Canadian stores this spring due to shrinking sales [Daily Brew]
• The REAL Death Of The Music Industry [Business Insider]){kind=link}
John,
You seem to delight in the struggles of this retail chain. Did you even think to ponder the impact of store closures on Canadian artists, employees and the music industry itself? Because let’s be fair – writing pithy little columns for Toronto Life magazine is not exactly the launching pad to journalistic success is it (and you wouldnt want me to take glee out of your sad situation right?). I could also point out the factual inconsistencies in your column, never mind the dubious sources you have used (the ‘Daily Brew’ isn’t exactly the G&M).
As a person who actually STILL BUYS(!) entertainment products, I can never find the particular blu ray or CD that I want at my local HMV. If I just want to buy a mainstream title, then every other store that competes with HMV will have it at about $5-$15 cheaper! Gee what a shock that HMV can’t stay in business… Normally, less competition means the other retailers can gauge the public if they want, but illegal downloading makes that kind of pointless.
Not surprised – HMV was always my last choice of outlet when Sam’s, A&B, A&A, Discus, Music City were around.
Whenever I buy physical CDs (which is always more frequent than downloading) I usually end up at amazon.ca – the prices are better (about 30% less) and the selection is something I never got at HMV, even during the CD boom years.
Everyone almost rejoices at another closure, which is always odd but consider the following facts.
Another business going under in Canada ups the unemployment rate.
HMV is one of THE last record stores, if not THE last one. Yeah sure, iTunes is out there but iTunes isn’t local. A lot of HMV’s cater to local needs… unlike your walmart, future shop, best buy, amazon.com and the such. HMV’s have helped local bands get recognition in markets where no one else could even order their cd. Sometimes for those artists, it’s as simple as phoning and asking.
It sucks that Sam, A&A, A&B Sound, Musicworld all went under, but it’s not HMV’s fault, everyone just blames that guy who’s left.
HMV might have higher prices but the people at HMV tend to know a bit more than the Amazon search or especially the Walmart employees.
I hate sounding like a fanboy, but seriously, the last thing we need is another business going under in Canada, and if Walmart is the only place left to buy video games… I’m going back to using my imagination.
The last time I was helped at HMV, none of the titles I was lookig for were anywhere to be found. I was looking for some King Crimson and the latest Uriah Heap. The manager (this was in Halifax), told me they don’t stock them because people were downloading them. I suggested it were stocked, I wouldn’t have to look elsewhere such as a mail order or a download.
When I got home, I looked up the #1 download on the ‘net, Black Eyed Peas. Of course, HMV had that CD.
CD Music stores have to realize one thing: Everyone who walks into their store, wants to buy something. If they don’t have it, they’re going to look elsewhere, and after a while, downloading may be the only alternative.
I have the answer for this, however. Put computer terminals in the store hooked up to a printer and a data base of music. Let people pick and choose of the data base, or net and allow them to make a CD of their choice, right in the store. The sooner this business model is adapted, the sooner everyone can continue shopping for music of their choice.
Pop music (the main source of revenue for most record labels and record stores) captial s sucks.
When music is of good quality, it sells. Quel’le suprise.
Pop music (the main source of revenue for most record labels and record stores) capital s sucks.
When music is of good quality, it sells. Quel’le suprise.
When I usually buy any type of physical entertainment media, the first couple of stores that comes to my mind are, BestBuy/FutureShop, and Wal-Mart. In my opinion whenever I walk in HVM and browser around everything seems more expensive. A recent experience reminded me why I would never go to HVM every again to make any purchase. My girlfriend works at Fairview Mall (Toronto) and one day I brought in a BestBuy flyer to do a price match for the Inception Blu-Ray ($19.99) while they were selling it for $29.99. Before I showed the sales person the actually flyer, I ask if they do price match (he says yes), told him BB was selling it $10 less (he just laughs and thought I was nuts). However, when I showed him the flyer he refused and said it is below their cost and told me to pick it up at BB. Yes I did end up going to BB Scarborough Town Centre to pick it up and a couple more BR movie that I wasn’t thinking of getting. Now reflecting back I think HVM policies and their sales people are a joke, it could be only this specific store, but it has left a bad after taste.
Not surprised. The bosses must still be living in the last decade as evidenced by the shitty prices on movies and games and not to mention the lack of stock of catalogue titles while overpriced new releases are over abundant. Best Buy, Future Shop, Walmart, Zellers, Amazon… they all sell for cheaper and mostly have stock.
HMV = FAIL
The Internet has levelled the playing field for new artists, and independent labels because they can upload their music directly to iTunes and about 1000 other sites which pay them directly!
Compare this to the old model whereby an independent artist had to:
1) get noticed by a record label
2) get signed
3) record an entire “commercial” album that will appeal to the masses
4) have massive sales, because if you don’t they can’t pay all of the executives at the record company. You cannot start over again, because once you’ve done this, they won’t give you another chance.
Nowadays, THIS is how it works, and why HMV and the record companies can’t figure out how to compete:
1) scrounge together a computer, a few mics, or a friend with the equipment and knowhow to do a recording
2) record, mix, and master your song, or album
3) post it online
4) tell your friends and promote your music online
5) if you don’t have a lot of sales, go back to step 1
Good luck with trying to do that with the traditional system.
I download music, but the problem is, there is no sound quality in those compressed files.
I would be very sorry to see HMV disappear in Canada. They are a great store and I use them frequently for DVD purchases. Their selection and pricing is very good and I like the store layout too.
It would be a significant loss if they disappear, I for one think they do a great job and wish them the best of luck during difficult times for the industry.
I do not rejoice in any business closing up but on the brighter side maby the mom and pop music stores which are still around can compete now. HMV has had a major monopoly on the scene for years. I called it they were in trouble a while back when I saw how much ”other” products they starting getting in that weren’t CDs etc.
I’m not surprised HMV is closing in Canada. Even 10 years ago their prices were higher than Sam’s, Music World etc. I knew they were “toast” when they started to sell t-shirts, books and video games a couple of years ago. Bye, bye HMV you’re done!
Their video games are at least $10 more than everywhere else. In fact, Shoppers Drug Mart sells Nintendo games cheaper than HMV (and that’s saying something about how out of touch HMV are with consumers)They held on to the outdated business model of raking the consumer for as much money as possible without realizing the power of downloading. They also jumped aboard the DVD bandwagon in the late 90’s and put all their eggs in that one basket and then DVD gave way to Blu Ray, Netfix, downloading etc. Greed is what killed them.
Actually, since Sam’s went under, HMV has improved much of its pricing policies, with many CDs selling at 2 for $20. The staff is quite nice, too. But if you want to talk about gouging, Sunrise is the place to go to. The Yonde / Dundas store was selling the Beatles mono set for $500 which was illegal, as it was being sold above list price. And many of its store sales, promos etc. have been misleading and often their prices for Cds are more than at HMV. At the end of the day, Soundscapes is the best new store for buying CDs but HMV is overall not too bad, either. It would be s shame if it were to go under especially if Sunrise records were still left standing. And as someone who buys physical Cds and doesn’t download music, any retailer going under is bad news.
Read somewhere they are redesigning their stores. What will they be doing?
The begining of the end is when hmv Canada brought in a new president from the Sony stores, a guy who knows nothing about music and movie retailing. He then brought in a guy who helped run Sam the record man I to the ground as vice president of product. It has been a downward spiral ever since and now HMV are toast. And ironically the president pulled a dick tuck and ran off to a lesser position with Rogers. Why Rogers would being on a failure is beyond my comprehension….watch your back Rogers and ignore any recommendations “he” makes. A 5th grader has better business sense that he has. FAIL!!!!
Some good points here. I TRY to buy at my local (Fredericton) HMV but there’s not much to be had… Why? Staff say central buying based on stock replacement and someone in Toronto determining their stock is a serious problem. Why not let the staff have some say; they know what’s going on in the store. In the UK, HMV own some stores named FOPP. These are – by comparison – great. The one’s in Edinburgh and Glasgow tend to stock more diverse catalogue (read: more than the top 20) and are generally hip. I believe there is demand for CDs, but the lousy business model of HMV is strangling it’s future. I certainly hope they don’t die in Canada… but they did in the States. And in the UK they’re shutting a number of shops and have unloaded Waterstone’s the chain of bookstores acquired a few years back.
Wow I see alot of people here slaming hmv for no reason at all. As a former employee I know the ins and outs to the reasons why its like that and maybe for any other companies. They buy only for about 100 stores in Canada and you buy accordingly they don’t have really the luxury like Walmart, Future Shop or Best Buy to use it just for lost leader or arrange for better pricing because of their deeper pockets given the fact that the do sell other things than music and movies.
How do I know because I used to buy for a store and one of those new cd release like Lady Gaga (I know hate her too) sells for $12.99 and buy one for the store costs $11.98 given her record distributor is Universal Music if the previous negotiation for purchasing still holds. Yes they are a well known chain but they specialize in just Movies, Games, Music and related items.
Amazon is another example to with deeper pockets and they don’t have multiple stores pay rent, electricity, internet, phones, pay for shipping costs to the stores, renting POS systems and computers. They have a central Warehouse where they can keep their wares along with other items that have nothing to do Music, DVDs, Games and related items. Amazon may as well be using music and DVDs as loss leader too.
Before you guys slam them you have to think about the situation and the reasons.
One facet that I did like was the fact that if they didn’t have it they would order it in no shipping charges, no deposits and they would call me as soon as my item came in. The one thing you had to be was patient sometimes because as I learnt later on when I worked there is that there were sometimes minimum requirements that distributors needed before the would send the product to the store like Universal Music’s $500 purchase for the store before they would ship or other companies like Paradox Entertainment (This company would carry a lot of Anime for me) was minimum 10 items order before it would ship.
I worked there for about 6 years before I choose to leave because of the declining sales. I wouldn’t have but I have a family to think about and I left right on time because it has been a year.
Like a previous poster here has said I’m too a little worried for the Canadian Artists on smaller labels because they did have quite a few Canadian Artist in their Catalogue in the stores. Whats going to happen to them now.
hahaha everyone crying about losing minimum wage jobs at a big retail chain? Maybe this will open up better jobs as the online market continues to expand, and allow the musicians who actually create the music better margins on their sales?
When I saw a Justin Bieber Poster being displayed for sale Right beside the “Metal” section, I just told myself “it’s time to leave”
As a devoted HMV customer, over the years I have spoken to many employees at HMV and consider them to be nice and knowledgable. It would be a tragedy if they closed, becuase I only go there, otherwise I’m on i-tunes. As for all your haters, you need to get a personality check. These people work hard and you obviously don’t care if the stores close, but they will lose their jobs, so before you criticize maybe you should find a job first.
This makes me sad! I love HMV. I still buy tons of CD’s and there are so many DVD’s I also want. Now I will have to order most of them online.
Personally, I am a big bargain shopper and only like to go into stores like Walmart, HMV, Future Shop, Best Buy and the soon to be gone Zellers to look at the bargain bin. (As well as some independent stores)and I have often walked out of HMV with one or two DVDs that I was excited to find. I only buy online if I have no choice or if it is a film I desperately want which is rare. With HMV gone, there goes another store that I frequent that I cannot bargain shop at anymore! I was so sad to also see Metro Video go under. Blockbuster though, I had no problems with. The management is terrible and employees were constantly threatened of being fired! I see that a lot of people think that the prices are high, and generally I do somewhat agree. But as a bargain shopper so only comes to look in the bargain bin, it is something that doesn’t bother me. As a matter of fact, I find often enough that the one store that I never find anything that I like for cheap is at Future Shop. I hope HMV improves and sticks around.
Good. HMV sucks, there customer service is useless, I tried to find a movie, asked if they could help, and they said if it wasn’t there, they didn’t care. Store doesn’t carry any good movies anymore. I don’t like music, and if I did, I have youtube and they don’t carry games anymore. I hope these assholes go out of business.
Hey, James Noorie, your a nobody, i looked you up and found one article that nobody ever read and nobody will ever care about. Not even your mom, sorry, it was about 2 homosexuals and their night out, i have seen better writing come from mentally challenged. Don’t make real authors feel bad just because you fail at everything your try.
I like HMV and don’t download movies or music although my daughter does download music from time to time. Sad to see stores like this go.
WOW…….we’re not too bitter now, are we? Are you “Axel Rose” from GNR? That would explain a lot LOL!
What idiot people in this country don’t seem to realize, is that if HMV close, who will take their place? Truth is, Canada can’t produce anything to compete with US chains. Then again, we have moronic Canadians.