Universal Music's Bright Idea

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The recording industry has often seemed maddeningly unaware of some of the most interesting developments in music today. However, Vivendi's (NYSE: V) Universal Music Group is experimenting in Europe to try to boost CD sales once again. It might just be a much-needed musical makeover.

Universal Music is testing different levels of packaging and pricing for CDs. For example, a basic CD will have a low-cost cardboard case and a lower retail price to compete with cheaper digital versions. "Deluxe" editions will cost more but will include more durable jewel cases with locking mechanisms (it'll be harder to bust the jewel cases, much less the CDs inside) as well as bonus content for hardcore fans.

As news reports noted, music giants like Sony's (NYSE: SNE) BMG, EMI, and Warner Music Group (NYSE: WMG) have made few attempts to innovate with the CD format for the past 20 years, despite recent sagging sales. With cheaper digital music now available, it makes perfect sense for the recording industry to recognize that CDs lend themselves more toward a truly collectible experience than a costly, cookie-cutter product destined to collect dust.

Of course, Universal Music's move to get on the right track is hardly a surprise, with variations of the idea already floating around. Although I struggle with my addiction to Apple's (Nasdaq: AAPL) iTunes Music Store, I have definitely fallen for some higher-priced collectible CDs lately. I'm a sucker for B-side and rarity compilations, which sometimes include bonus artwork, booklets, and lyrics, as well as large cardboard covers that hearken back to the heyday of the LP, once more giving your musical taste a higher profile on the shelf. Packaging and extras like these could help the music industry lure diehard fans, especially now that the labels can also add bonuses like videos or live footage to the package. (Apple's already experimenting with a digital version of the "package deal.")

Initiatives like this might not save the CD -- digital music has clearly entrenched itself with consumers -- but it could certainly help bolster the format's lagging sales growth. The major labels' considerable bellyaching over music sales and complaints about piracy's threatening effects -- and their inevitable surprise and shock that consumers might actually pay for digital music -- only exposed them as an old-fashioned industry apparently loath to give consumers the changes they demanded. There's clearly no excuse for the industry to suppose that the old way is the right way any longer.

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Alyce Lomax does not own shares of any of the companies mentioned.