A U.K. newspaper's groundbreaking move has divided the U.K. music business over the contentious issue of "covermounting" CDs.
The practice of attaching free CDs to magazine covers has been a feature of the U.K. music press since the 1990s. More recently, national newspapers began regularly giving away CD music compilations and movie DVDs.
The issue has long been the subject of debate between labels and retailers here, while trade body the Music Managers Forum has been particularly vocal about its negative aspects.
"How ludicrous it is that the music industry are shouting about illegal downloading," MMF chairman Jazz Summers asks, "but they're giving [music] away for free on the cover of a paper? It's the same thing."
At its annual Roll of Honour gala April 18 in London, Summers predicted the demise of covermounting, with U.K. numbers substantially down.
But within days, a nadir was reached when the national Mail on Sunday newspaper pressed up 3 million copies of Mike Oldfield's complete 1973 album "Tubular Bells" to distribute as a freebie. While music magazine covermounts generally feature compilations of new artists, previously the higher-circulation newspapers had concentrated on samplers of major new releases and catalog compilations.
The seminal Oldfield album launched Richard Branson's Virgin Records and gave "The Excorcist" its memorable theme. Although EMI could not confirm that figure, it is widely reported to have sold 15 million units globally. But on April 22, as a covermount, it effectively became as valuable as the newspaper it came with.
Ironically, three years ago EMI became the first U.K. major to turn its back on covermounts. "We haven't changed our policy," an EMI representative says. " 'Tubular Bells' was a complete one-off, for reasons I can't disclose."
Although EMI declined further comment, the "Tubular Bells" giveaway came only a few months before the company loses the rights to the album. In 2005, Mercury Records U.K. secured the rights to Oldfield's catalog upon its reversion to the artist. That happens in July, when the catalog—including Oldfield's biggest releases "Tubular Bells," "Hergest Ridge" (1974) and "Ommadawn" (1975)—switches to Mercury.
Oldfield was not available for comment, but recently told digital radio channel BBC 6 Music: "I feel the same as if I had lent something to somebody and it had come back trashed."
EMI also declined to comment on reports that it earned £200,000 ($400,000) for the giveaway.
"I can understand the reward might be difficult to resist," Summers says. "But you've got to look to the long term in our business; if you look for short-term gain, there's long-term loss."
U.K. authors body the Mechanical Copyright Protection Society confirms the number of covermounted CDs diminished in 2006, when it licensed 296 CDs, resulting in 78.3 million units being covermounted. During the same period, British consumers bought 154.1 million CD albums, according to Official U.K. Charts Co. data.
In 2005 MCPS licensed 388 CDs, resulting in 250.2 million units being covermounted—almost 100 million more than the total number of CDs bought (159 million). MCPS collected £6 million ($12 million) from covermounts last year, half the 2005 sum.
Retailers say the covermount figures are still too high. "Such media promotions may temporarily boost newspaper circulations, but all they achieve for our business is a cheapening of the CD format," says Mel Armstrong, music product manager for market-leading music and entertainment retailer HMV.
The Mail on Sunday is quick to defend its position and says it will issue further core catalog releases. "I don't really understand this whole reaction to what we do," managing director Stephen Miron says. "We pay our licenses, we give money to the artists, we present music in an ultra-professional way, and for some reason they all think it's a bad thing to do. Every artist has been grateful for the work we have done, with the exception of Oldfield, who I think objected to the fact he wasn't communicated [with]."
"Philosophically, covermounting is bad for the business," Summers says. "The public's perception of music is that it's free. And if the American record companies were thinking of going for it, someone should tell them, 'Don't do it.' It's another nail in the coffin for the music industry."
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