Digitally Stored Music Vanishes
The problem, as explained in a recent Rolling Stone story, lies not with old analog masters but with fairly recent digital ones: "Smash Mouth had to go rerecord parts of their 1999 hit 'All Star' for a TV ad when the digital master was missing tracks. Engineers at EMI have discovered that drums and percussion effects on some Eighties recordings are gone. As a result, engineers are sometimes forced to reconstruct these effects themselves."
In addition to simply losing stuff -- which the recording industry has been doing for much of its history, even back in the days of analog recording -- engineers now grapple with early digital technology that requires obsolete equipment or plug-ins that are no longer available.
In addition, archivists are finding that digital audio storage technologies are proving to be much less robust than their analog predecessors. Anyone who has ever been confronted with a rotted CD-R or crashed hard drive will recognize the problem.
See Rolling Stone.