re-printed by permission.
How Tower Records Committed Suicide
By LEE BALLINGER
The calamity caused by the liquidation of Tower Records doesn’t just
consist of the 2700 workers fired and the dozens of small label
releases that will lose their most important national outlet. It isn’t
just that Tower will certainly take down with it some indie labels and
distributors to whom it owed a fortune. It certainly isn’t just the
eight-figure losses each of the major labels will absorb, probably
resulting in more firings at those that aren’t already pared to the
You’re going to feel the demise of Tower too, even if there isn’t a
Tower anywhere near you. Tower died not because of illegal downloading
or any other record biz boogeyman. What killed the chain, in the final
analysis, is the breakneck expansion and consolidation of the past 20
years. Although Tower didn’t participate in the merger and acquisition
of other chains which have led to so many other bankruptcies, it did
attempt to spread tentacles coast to coast and continent to continent.
Tower CEO Russ Solomon is revered in the music industry. But why? In
the name of profit, Solomon made Tower one of the chains that most
avidly championed Tipper stickers and record label lyric screening
committees. Combined with the equally crazy campaign to condemn fair
use of copyrighted material to the dustbin of history, this shrewd
maneuver choked the most exciting record-making climate since the dawn
of rock’n’roll. Then he expanded his California business all the way to
New York and Tokyo, without managing to figure out how to do anything
but lose money.
Now, consider what you’ll do for an alternative. Probably, if you’re a
big music fan, you’ll do more ordering from the Internet–meaning a
wait of a day to a week before you can hear the music you’ve paid for.
What you won’t be doing is going to your town’s record store with the
knowledgeable staff . That store doesn’t exist any more. Most likely,
price competition from the chains drove it out of existence. So what we
get out of the process is a temporary set of lowball prices, vastly
fewer musical options, and a long-term lack of convenience and absence
This phenomena operates throughout our society. It’s the reason
airlines and oil companies, insurers and drug corporations, even
electricity providers, jack up prices and strip down their services.
Most of the time, the only people who come out smiling are the
financiers, who peel off a part of every dollar in order to hire
sometimes great artists to play at their birthday parties.
Tower Records was a poster child for “hip capitalism,” a fig leaf term
meant to cover a system which justifies itself by providing
“competition” that leads to “innovation”–until the reckoning comes and
the cartel or monopoly begins to take shape, driving out all not on the
inside. The idea that this has made our society wealthy, efficient and
convenient is lunacy, as Tower’s demise confirms.
Tower Records was a suicide.
The choice we face is whether we’d like our entire society to do the
same or whether we will begin working to change it fundamentally.