Discs are obsolete, but the fun never gets old

McClatchy Newspapers (MCT) - Mike Phillips is a businessman in a business he says is impossible: selling CDs and records.

"If kids can download the new Jay-Z free of charge," he said, "why on earth would they pay me 14 bucks for it?"

But Phillips, who owns Schoolkids Records in Raleigh, will not give up on his record store. Instead of closing the doors, last month he moved the store from one storefront to another, cutting his space _ but also his rent _ in half.

In an era when teenagers thumb through iPods instead of stacks of CDs, running a traditional store sounds like a sucker's bet. Why not close?

Because a record store is still a cool place to be, Phillips said. It's fun to own one. And there are still those music fans who will dig for something unusual, which Schoolkids stocks plenty of. These people prefer to hold the music in their hands.

"They want Dead Mall Rats from Outer Space or whatever, and they can only get it here," he said. When they find it, "their eyeballs get big."

Phillips' musical tastes lean more toward The Allman Brothers and Pat Metheny. He opened the Raleigh Schoolkids store in 1974, in a space below the nearby bowling alley. In his best years, he owned a half-dozen Schoolkids stores in the region. One remains.

Phillips, 56, no longer collects a salary from Schoolkids. About a year and a half ago, he got a "real job," working in the wholesale apparel business. The Raleigh store, which employs one full-timer and six part-time workers, breaks even or comes very close to it. The store makes about $1.50 in profit for each CD sold, he said.

Phillips is not bitter. Times change. He has four children, ages 16 to 27, and they seldom shop at the store.

"They don't need Dad," he said. "Dad is obsolete."

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Ric Culross, the store's general manager, has worked for Phillips since the early 1990s. The average Schoolkids customer has aged over the years, he said, moving from high school and college-age kids to people in their mid-20s. Most younger listeners don't have the album-collecting habits of the older crowds.

"Music is not a file," Culross said. "It's an art form."

Although the new store is smaller, Phillips said he'll be able to carry 95 percent of the stock he used to. When they moved, they brought along 5,872 CDs, along with several thousand vinyl albums.

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According to the Recording Industry Association of America, manufacturers shipped 511 million CDs to stores in 2007, the last year for which statistics are available. In 1999, they shipped 938 million.

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Still, not all teens have abandoned record stores. Emily Foley, 16, blew peppermint bubblegum bubbles and flipped through CDs at Schoolkids on one recent evening with friends from school. With her Black Flag T-shirt, Foley wore allegiance to a band that broke up more than 20 years ago.

Foley likes Schoolkids because the store stocks hard-to-find punk gems. And in 30 years, she'd prefer to hold an album in her hand and think back to the times she had with her friends, shopping at Schoolkids. An iTunes file will not be the same.

"It won't have memories, you know?"

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© 2009, The News & Observer (Raleigh, N.C.).