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Digital Music Sales Are Still Climbing

Posted on: Tuesday, 18 August 2009, 15:15 CDT

Market research firm NPD Group announced on Tuesday that compact discs accounted for 65 percent of US music sales in the first half of 2009, but digital downloads are expected to nearly equal CD sales by the end of the year.

"Many people are surprised that the CD is still the dominant music delivery format, given the attention to digital music and the shrinking retail footprint for physical products," said Russ Crupnick, NPD vice president of entertainment industry analysis.

"But with digital music sales growing at 15 to 20 percent, and CDs falling by an equal proportion, digital music sales will nearly equal CD sales by the end of 2010."

Music purchases through the Internet accounted for 35 percent of all music sales in the first six months of the year, up from 20 percent two years ago and 30 percent last year.

According to NPD, Apple's iTunes accounts for 25 percent of all music units sold, up from 14 percent in 2007 and 21 percent in 2008.

Walmart accounted for 14 percent of all music volume sold, followed by Best Buy.

"The growth of legal digital music downloads, and Apple's success in holding that market, has increased iTunes' overall strength in the retail music category," said Crupnick. "But the importance of the big box retailers shouldn't be dismissed, as long as the majority of music consumers continue to buy CDs."

NPD said consumer downloads through iTunes has comprised of 69 percent of digital music sold in the first half of the year, followed by Amazon with eight percent.

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On the Net:

• NPD Group

Source: redOrbit Staff & Wire Reports

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