-- From concert promoters to record labels, people in the industry are wondering when consumer spending will return to pre-subprime loan mess levels. Earlier this week, the National Bureau of Economic Research declared that the recession official ended in June 2009 - on a statistical level. Consumers, however, might feel differently.

On Wednesday, Warren Buffett told CNBC he won't consider the recession over until per-capita GDP returns to its September 2008 level. "I think we're in a recession until real per capita GDP gets back up to where it was before. That is not the way the National Bureau of Economic Research measures it. But I will tell you that on any common sense definition, the average American is below where he was before, or his family, in terms of real income, GDP. We're still in a recession. And we're not gonna be out of it for awhile, but we will get out of it."

After 2010 failed to be the expected recovery year, hopes were transferred to 2011. But now it appears 2011 may not live up to expectations either. All around there are signs that global economic recovery is slowing: weak numbers in Europe, worries about Ireland's debt and its shrinking GDP, discouraging unemployment claims figures in the U.S. and pressure on the U.S. dollar.

This continued economic malaise puts downward pressure on items like concert ticket prices, demand for consumer electronics (which influence the adoption of new music services) and advertising budgets (which influence licensing revenues for record labels and music publishers). All are things to keep in mind when building your 2011 budget and forecasting for the next few years.
(CNBC, AP, Financial Times)

-- Citigroup and Terra Firma appear headed to court. "A person familiar with Citi said the odds of the two sides reaching an out-of-court settlement were "atrociously small," reports the Financial Times. If the case goes to court, arguments begin Oct. 18.
(Financial Times)

-- Asthmatic Kitty is criticizing Amazon.com's practice of discounting prices on music titles. Label founder and musician Sufjan Stevens wrote in an email to fans that low pricing can devalue music: "We have mixed feelings about discounted pricing. Like we said, we love getting good music into the hands of good people, and when a price is low, more people buy. A low price will introduce a lot of people to Sufjan's music and to this wonderful album. For that, we're grateful.

"But we also feel like the work that our artists produce is worth more than a cost of a latte. We value the skill, love, and time they've put into making their records. And we feel that our work too, in promotion and distribution, is also valuable and worthwhile.

"That's why we personally feel that physical products like EPs should sell for around $7 and full-length CDs for around $10-12. We think digital EPs should sell for around $5 and full-length digital albums for something like $8."

Funny thing about prices... consumers determine if they're adequate, not the party selling the item and establishing the price. A record label that knows nothing else than making EPs and albums will naturally attach a particular price to them. It's the cost-plus pricing problem - you consider what went into making a product, add a markup and you've got your price. But that price could be too high, which means companies need to cut costs or sell at a loss. You can't tell consumers to pay more than they want to pay.

For years the music industry has been imposing its perception of its value on consumers, and it often doesn't work one iota. Isn't the $5 monthly fee of all these PC-based music streaming services that can't attract many paying customers supposed to be an incredible value for consumers? After all, it's less than the cost of a high-end cup of coffee. But compare the typical American's spending on coffee and recorded music. It's not even close. Even a couple of expensive concert tickets every year don't cost nearly as much as a Starbucks habit.

What does that tell you? It tells me Starbucks knows its customers. Amazon.com certainly knows its customers. Temporary low album prices bring people to the store and keep them shopping. So here's a question: do you really know your customers?

-- If you think you know your customers, read this thread at the eMusic message board to see if their comments are in line with your beliefs. In this thread eMusic subscribers - who spend far more on independent music than the average consumer - discuss how much they will spend on both physical and digital music. Good reading.
(eMusic messageboard, via @DigitalAudio)

-- Personalized radio service Pandora is blaming high royalty rates for its decision not to enter the Canadian market. "These rates ... are astronomical," founder Tim Westergren wrote in an email to The Canadian Press. "As long as rights societies take this approach, they will prevent Pandora from launching to Canadian users."

Canadian collection society Re:Sound has filed a request to charge Internet radio services the greater of (a) 45% of revenue or (b) 0.75 cents per song streamed. Re:Sound represents sound recording owners and performers, so additional payments would need to be made to songwriters.

However, Re:Sound president Ian MacKay says the organization is willing to negotiate. And that's probably what will happen. It happened here in the U.S. Copyright owners aim high knowing the final negotiated rate (or the rate established by a copyright royalty board) will be far lower. Digital service providers aim low. In the middle ground there is a rate where all parties can benefit.

-- Lots of fun facts about television usage in the U.S. in Nielsen's new "State of the Media." For example, the average American watches over 35 hours of television each week. Kids aged 2 to 11 watch nearly 26 hours per week. There are 116 million homes in the U.S. with at least one television, up 0.9% from last year. And here's one for the entertainment industry: awards ceremonies get only 2% of the audience.
(State of the Media PDF)

-- MySpace is taking a step to improve its entertainment division. Andy Marcus, formerly the senior vice president business and legal affairs, will move to senior vice president entertainment and video. He will report to David Donegan, senior vice president marketing.
(The Hollywood Reporter)

-- Productivity apps generate 59% of all smartphone app revenue, says In-Stat.
(Press Release)

-- M&A deals were driven by companies' desire for mobile technology, according to a new report by mergermarket.