Will OPEC Ruin America’s New Love Affair With Vinyl?

Dan Gibson | July 25, 2008 1:00 am

As evidenced by the stack of USB turntables for sale at my local Costco this week, vinyl has reemerged in the mainstream, thanks to the appeal/illusion of the format’s “warmer” sound and the resurrected idea that an album can be something large and pretty to show off to your friends. However, rising petroleum costs mean that the price of producing and distributing vinyl is only going to get higher. So how long will this particular form of fetishism last?

But while future yard sale dollar record boxes are getting a new supply, vinyl pressings are expected to get pricier because of the higher price of petroleum, from which vinyl is made. The pressing plant used by Sub Pop records, for example, recently raised its prices, citing petroleum costs as one reason.

At United Record Pressing, in Nashville, Tenn., Jay Millar, director of marketing, noted that the industry is based, in every sense, on petroleum, from the vinyl itself to the oil that keeps the machines lubricated to the gas used to transport records, which are heavier than CDs.

“Realistically there’s not a component involved in our manufacturing that hasn’t gone up,” he said, noting that the company is weighing a price increase. “I think it’s inevitable.”

Putting an album out on vinyl is a bigger commitment than making a CD, said Mike Jones, the CEO of CDForge in Portland. Last year, the company’s volume of vinyl work doubled over 2006, and Jones expects a similar increase this year. The basic cost of a CD is about $1 per unit; for vinyl, which is a more labor-intensive process, it’s more like $4-$8 per unit for the initial pressing. “The artist and the record label really have to believe in its importance,” he said.

CDForge doesn’t press vinyl itself; the company deals with Rainbo Records, in California, where the cost of vinyl’s gone up since the start of the year. “It’s gone up 11 percent since January 1st, and I understand another increase is coming, about a 4 to 6 percent increase,” said Steven Sheldon, the company president. Including gas prices, the per-record cost has probably gone up 20 to 22 cents a record, he said.

Not mentioned, but vinyl is also a greater reach for retailers, since the record format has generally been non-returnable to distributors. (Watch out for a sale on those Sara Bareilles LPs in a few months!) Thankfully for those producing vinyl, the format seems less sensitive to price increases, since the lure is less connected to the actual music than the pride of ownership, at least in some cases. The compact disc has clearly lost its intrinsic value, but the record industry still has a chance to find its way by selling vinyl at Hot Topic locations.

Will oil prices sink the vinyl record boom? [The Oregonian via Coolfer]