The Wall Street Journal delineates the oncoming disaster for the music industry: Sales of Music, Long in Decline, Plunge Sharply.
Here are the important quotes:
• “compact-disc sales for the first three months of this year plunged 20% from a year earlier…”
• “CDs…still account for more than 85% of music sold…”
• “About 800 music stores, including Tower’s 89 locations, closed in 2006 alone.”
• “This year has already seen the two lowest-selling No. 1 albums since Nielsen SoundScan, which tracks music sales, was launched in 1991.” (Daughtry: 65,000 and Dreamgirls: 60,000)
• “As recently as 2005, there were many weeks when such tallies wouldn’t have been enough to crack the top 30 sellers.”
• “Digital sales of individual songs this year have risen 54% from a year earlier to 173.4 million… But that’s nowhere near enough to offset the 20% decline from a year ago in CD sales to 81.5 million units. Overall, sales of all music — digital and physical — are down 10% this year. And even including sales of ringtones, subscription services and other ‘ancillary’ goods, sales are still down 9%…”
• “Perhaps the biggest factor in the latest chapter of the music industry’s struggle is the shakeout among music retailers. As recently as a decade ago, specialty stores like Tower Records were must-shop destinations for fans looking for both big hits and older catalog titles. But retailers like Wal-Mart Stores Inc. and Best Buy Co. took away the hits business by undercutting the chains on price. Today such megaretailers represent about 65% of the retail market, up from 20% a decade ago…”
• “Best Buy has been quietly reducing the floor space it dedicates to music…”
Doomed! Doomed, I tell you!