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What happens when the CD factory closes?

The tech industry applauds as music goes digital. But in towns like Pitman, N.J., innovation comes at a price.

Greg Sandoval Former Staff writer
Greg Sandoval covers media and digital entertainment for CNET News. Based in New York, Sandoval is a former reporter for The Washington Post and the Los Angeles Times. E-mail Greg, or follow him on Twitter at @sandoCNET.
Greg Sandoval
5 min read

PITMAN, N.J.--In this corner of the music universe, you won't find many limousines, groupies, or people lighting guitars on fire.

Sony Corp.

While the public often associates the music business with jet-setting rock stars and lavish living, this place is marked by minivans, Phillies and Eagles fans, and, very soon, people without work.

Pitman, which has 9,365 residents and is about 17 miles southeast of Philadelphia, is home to one of Sony's two remaining U.S.-based CD-manufacturing plants--until March 31. After that, the company will shutter the facility and 300 workers will be out of jobs. A Sony spokeswoman recently cited an ailing U.S. economy and sagging interest in physical media as the reasons for the closure. A longtime employee sized up the situation more succinctly for CNET last week: "The CD is dying."

The plight of those 300 workers isn't likely to get much attention in Silicon Valley. The prevailing wisdom in tech land is that the compact disc--the dominant music-distribution format for nearly three decades--has outlived its usefulness, just as the vinyl LP did. Why lug around CDs, which typically come with 15 songs, when an iPod and similar devices enable owners to stick the equivalent of 2,000 discs into their pants pocket?

Fair point, but many would argue innovation isn't the only reason CDs look long in the tooth. After a decade of rampant illegal file sharing, they'd argue, the plant closure is a sign that the CD just couldn't compete with free.

Digital masters
Sony once operated three CD-producing facilities in the United States but will soon be down to one. In 2003, Sony closed a CD plant in Springfield, Ore. In that case, 277 jobs were lost. This also isn't the company's first experience with a dying music format. Many have already forgotten that Sony played a key role in ushering out the vinyl era. Sony began development of an optical digital audio disk in the mid 1970s. In 1979, the company teamed with Phillips to do more study. The first album released on CD and offered to the public was Billy Joel's "52nd Street" in October 1982.

Billy Joel's '52nd Street' album was the first to be released to the public on compact disc. Sony

Sony's Pitman plant survived the vinyl-to-CD transition. The facility was built in 1960 by Columbia Records to press vinyl albums, according to Sony's Web site. It started churning out CDs in 1988, the same year Sony acquired Columbia, which produced that groundbreaking Joel CD. The artist Patti Smith, known to many as the "godmother of punk," once considered working at the plant during the late '60s but moved to New York instead, according to her book ""="">"Just Kids."

For the major music labels, the CD represented a golden era, said Jac Holzman, the man who discovered The Doors, co-founded Elektra Records, and is one of the music sector's leading tech voices. The CD prompted music owners to upgrade vinyl libraries.

But by selling CDs, the poobahs at the record labels also placed the equivalent of digital-master recordings in every home, Holzman said. They had no way to foresee how the CD would enable ripping, iPods, peer-to-peer networks or how those things would slam into their business like a wrecking ball.

No file-sharing scapegoats
On Thursday, three employees spoke to CNET in the parking lot of the Sony facility, a block-long building with a windowless facade and surrounded by a snow-covered field. The employees acknowledged that online piracy and the iPod likely had a hand in killing their jobs. The men, however, didn't appear to be looking for scapegoats.

One man, who refused to provide his name for fear of angering Sony managers, said it's pointless to lash out. He said piracy has burrowed too deeply into our culture to do anything about now. "My teenage daughter does it," he said. "I told her 'Hey, you know you're putting your dad out of a job?' She's a teenager. They don't understand. What they understand is they want music and it's available someplace for free."

He said the truly worrisome trend for him was when the CD began to lose longtime friends. "They stopped putting CD players in cars and I knew things were bad," the worker said. The CD was once a staple of a car's dashboard but the past several years, car manufacturers have searched for ways to tap into Web-distributed music.

Eric Weaver, a 22-year-old who has worked as an IT worker at the Sony plant for four years, is a good example of what the labels are up against. He said he sees some positive aspects to music file sharing. He said he no longer even bothers to rip to his computer the free discs Sony offers employees. So, that means he buys his music from iTunes or Amazon, right?

"Well, some of it," Weaver said. He shrugged and smiled. "Some of it I get from other sources."

The new buggy-whip makers
Pitman appears to be one of the impact points, where changing consumer tastes, technology, and a down economy collide. So, what then is to become of the plant's workers?


Victor Morales, another Sony worker, told reporters from NBC 10 in Philadelphia that he and his wife were nearly ready to buy a house but must rethink their plans. One female worker told the news outlet that she was "devastated" and called her coworkers a "second family."

Some of Sony's employees are hoping to ride out the CD a little longer. They are trying to secure jobs at Sony's last remaining CD-manufacturing facility in Terre Haute, Ind.

Besides the employees, the closure of Sony's operations in Pitman could affect the entire area. Michael Batten, Pitman's mayor, said the town is only 2.2 square miles in size and Sony's CD plant accounts for 72 acres. "There was a time when Sony paid $1 million in taxes," Batten said.

To make up for the shortfall, Batten said "we're just going to have to cut where we can."

Clancy's Pub is getting squeezed in this Sony cutback, too. The bar/restaurant across a narrow two-lane highway from the facility is a favorite hangout of the plant's workers. At the bar, bulky men wearing baseball caps and boots stuck with snow sip drinks and watch sports. The only music gear in the place are two electric guitars hanging on a wall as part of a beer ad.

Mark Leotti, the bar's manager, said Sony employees and their spending have steadily decreased over the years, meaning waitresses and bartenders as well as the restaurant's owners feel the pinch.

It would be easy to write this off as a music industry problem, but one has to wonder how much life is left in the DVD. Sales were down 13 percent last year as video services that use the Web to deliver movies to customers' homes appear to be catching on.

Sony employees interviewed said the Pitman facility used to make Blu-ray discs. Those jobs were cut last year.

Note: Below is a brief news story about the closure by NBC 10 in Philadelphia.