“After a lengthy auction stretching over two days, a federal bankruptcy judge on Friday approved the sale of California-based Tower Records to Great American Group, which plans to liquidate the music retailer,” Randall Chase reports for The Associated Press. “After almost 30 hours of what attorneys described as ‘robust’ and ‘vigorous’ bidding, Great American won with a bid of $134.3 million, beating Trans World Entertainment, which had hoped to continue operating at least some Tower stores, by a single bid increment of $500,000.”
“Peter Gurfein said Great American plans to begin the liquidation process and going out of business sales on Saturday, which eventually will result in the elimination of the jobs of some 3,000 Tower employees… Tower Records, which has 89 stores in 20 states and owes creditors about $200 million, filed for Chapter 11 reorganization in August. In its filing, the company said it has been hurt by an industrywide decline in music sales, downloading of online music and competition from big-box stores such as Wal-Mart,” Chase reports.
Full article here.
[Thanks to MacDailyNews Reader “Tommy Boy” for the heads up.]
The old makes way for the new. Apple’s iTunes Store music sales passed the likes of Borders, Sam Goody, and Tower Records, NPD reported in November 2005. Note: last Tuesday, Napster Inc. said it had launched an online song distribution site in Japan in a joint venture between America’s Napster and Tower Records Japan, Inc., which, from what we can tell and despite the name, is a separate company from the Tower Records that’s about to be liquidated. NTT DoCoMo Inc., a Japanese mobile operator, is the main shareholder in the Tower Records Japan, Inc. owning an approximate 40% of the company.
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Beleaguered Napster opens online song outfit in Japan – October 03, 2006
Tower Records files for bankruptcy – August 21, 2006
Tower Records to debut yet another Windows-only WMA-based iTunes Music Store also-ran – June 26, 2006
NPD: Apple’s iTunes Music Store now the 7th largest U.S. music retailer, up from 14th last year – November 21, 2005
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First post!!!!!!!! YOOOOOHOOOOO!!!
It was bound to happen. Welcome to the future!
This is unfortunate. Tower Records was my favorite music store in town. I believe there is still room for brick & mortar stores as well as online stores. I buy from iTMS, but sometimes I want the entire CD. Tower provides/provided the best selection in Denver, IMHO.
It’s WOOO hoooo.
Such a turning of an age – I was privileged to design Tower’s first website in 1994. I wish I had saved a copy – I think it would be fun to look at it now.
i agree with Jimbo that there is a place for brick and mortar stores. I mostly buy my physical CDs from independent music stores, or i buy them used. I have never bought a full CD through iTunes and likely never will. The cost is just not appealing enough to offset the losses in quality, booklets, etc.
Tower, HMV, and the rest of them made a shitload of money when new CDs were selling for $18.99. I can’t say i’m sad to see them go.
Also, we should note that Tower had problems for quite a while–this is the second bankruptcy Tower’s gone through in two years.
Tower made the mistake of borrowing a ton of money for expansion just as the twin complications Best Buy and Circuit City selling Cds as loss leaders and P2P music sharing exploded.
I agree with Jimbo. THis is a shame. Not only did a store like Tower have much better selections than the big box retailers (especially for genres like classical and jazz), but I really don’t like supporting WalMart with their policy of censorship when they don’t like content.
With Best Buy, Circuit City, and Wal-Mart entering this market with better prices. And Amazon with competitive prices and better selection, the market for CD sales is tough.
Tower is just the latest in the line of music stores that have gone under. The same thing happened with the independent video rental store. Times are changing.
BTW, I disagree with MDN’s take. The iTS alone probably had very little to do with Tower’s demise.
Tower can bite the dust – good riddance. There was an agenda in the products they carried/promoted (and it wasn’t to make money). They were like a made-by-MTV store.
uncle fester: I was privileged to design Tower’s first website in 1994. I wish I had saved a copy – I think it would be fun to look at it now.
perhaps you can go back to it via the “wayback machine”. type in a website and view it’s history.
http://www.archive.org/web/web.php
p.s. it’s also kinda fun to view past editions of apple.com via the ‘wayback machine’ or any other site
More blood on Apple iTunes Music Store’s play button? Um… how? As OpJ notes, Tower has been in bad shape for a while. Even if iTMS never existed, this most likely still would have happened.
That headline is just perpetuating a myth that anything having to do with music that is negative is Apple’s fault…
It’s never a good day when a music store shuts down – for any reason.
mac user 47 said: “There was an agenda in the products they carried/promoted (and it wasn’t to make money).”
Most realtors have an agenda in the products they carry – in addition to the agenda of making money. Few, however, are not there to “make money”. The original agenda for iTMS wasn’t precisely to “make money” so much as to “not lose much money” while boosting iPod sales to make the money back. Cisco has stores – both B&B and on-line – that are similarly intended … make a little money while promoting the company. Most, though, are not part of a company’s marketing department and have to get along without subsidy. Their agenda – the one besides “making money” – is secondary to “making money”. Even when it causes them to make <u>less</u> money, it is not allowed to force them to make <u>no</u> money.
Business 101 – available at community colleges everywhere.
Way to go Napster!
Team up with bankrupt companies!
Suddenly competitors to Apple are making thinks so easy.
Reminds me the scenario of Microsoft in the early 90’s. Competitors were so stupid (including that old Apple), that made things so easy for Microsoft, that turned Microsoft into what it is today. Fortunately tables are turning in favor of us!
in NYC the two best places for jazz and classical CD’s were J&R Music and Tower Records. their jazz sections were as large as some whole music stores! if you’ve ever gone into a Sam Goody or other such “mall based” store you’ll notice that the jazz section is practically non-existant. dont even mention Wal-Mart… if it aint Top Forty or Country they wont have it.
i enjoy listening to all sorts of music and sometimes i’d rather have the physical CD over a download from iTMS.
i for one cannot celebrate the demise of what was a good source for CDs. cost aside, Tower was one of the better record stores out there.
i for one will miss ’em.
i’m not happy about this either. i prefer to have physical CDs rather than be encumbered by DRM restrictions. i own about a dozen songs from the iTS and i had to do the burn/re-rip in order to play back in my car’s MP3 player. annoying.
there’s no Tower in my neighborhood, but when i did go to Tower in other cities i enjoyed finding music there i couldn’t get back home.
however my tastes are quite more “alternative” than what most mainstream brick-and-mortar music stores are willing to carry, so i’ve had to increasingly rely on the intertubes to buy my music. i’ve had better luck purchasing music directly off the musicians’ websites.
We’re putting our CD’s on the shelf. My daughter has given her 100 disk player to me to sell, and I am emptying my 300 disk player for sale on ebay (if anyone even wants them now).
Since ripping our music to iTunes, we never listen to the actual CD’s anymore.
I hate physical discs about as much as DRM so i get my music without both
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To elitist DLMeyer:
You are clueless and obviously have had no experience with Tower Records.. The people running Tower were sidetracked in the culture they were trying to promote. By the way, most Business classes at community colleges are taught by the same smug, out of touch with the real world people as yourself – good at teaching what businesses do in hindsight, but clueless as to what makes them succeed or fail.
I’m sorry, but Tower kinda sucked. Their selection sucked. Their prices sucked HEARTILY. $18 for a CD? Um, no.
Virgin’s worse.
I’d rather pay the same amount but get better service (and talk to people who actually LOVE music as much as I do) at a small ma and pa record store.
See ya, Tower.
mudflapper:
i understand what you’re saying, BUT….
if you’re one of the millions of people in this country who might actually want a physical CD and you dont live near a Tower, HMV, Virgin or other music specific superstore AND there’s no mom-‘n-pop boutique nearby and your only choice is Wal-Mart, Target or some other really god-awful mall based store… that REALLY sucks.
the prices might have been higher… but you had a choice. Tower going out of business is a bad thing… music sales going the way they are, this could eventually affect even the mom-‘n-pop stores.
Buried Caesar, I’m right with you…
MDNs headline in this case is in poor taste. I always thought Tower Records was a pretty good shop to browse for music and videos in, it’s demise is a shame.
MDN, for once.. grow up and show a little magnanimity every once in a while
I prefer iTunes, its cleaner.
But for those of you still enjoying thumbing through the CD boxes at bricks and mortar, just don’t put your fingers near your mouth afterwards. What human residues must be residing on those tumbed cases can’t bear thinking about…(!)
Yeah, Tower’s prices sucked something awful, and on that note alone, they deserve what they got. As for having a choice, we have a choice of thousands of music stores. It’s called the Internet, you know? You can order CDs through it and stuff, you know?
Tower going bankrupt may cause a few small record labels to go bankrupt, or at least hurt quite a few labels. Tower was one of the few stores to stock a wide range of CDs.
For most of the best classical labels (BIS, Ondine, Hyperion, Harmonia Mundi, etc. etc.) Tower was the *ONLY* remaining store of any size that stocked their stuff.