CD Sales Continue To Drop, But Rate Is Slowing
October 8, 2007 at 5:30 AM (PT)
Nine months into 2007, CD and total album sales are still dropping -- just not as quickly as they were plummeting when the year began, reports REUTERS. But industry executives are predicting that even the relative slowing of the sales decline probably won't be sustained by what is now a slim fourth-quarter release schedule.
Overall album sales are down 14.2% and CD sales down 18.5% for the year so far, compared with the first nine months of 2006. For the third quarter alone, CD scans slid 6.8% to 94.9 million from the 114.2 million counted in last year's third quarter. Compared with the 20.5% drop that shocked the industry in first-quarter 2007, that figure could almost be considered a recovery; CD sales, in fact, have been slowing their decline through the year. In the second quarter, the format had dipped 17.9%, from 122.3 million units to 100.4 million.
But so far, retailers say, fourth-quarter prospects don't look promising. "Although we got a decent amount of rap titles coming, we need some rock and pop titles in the worst way," one retailer says. "The rock schedule is beyond a disaster at this moment." Another retailer says, "Other than UNIVERSAL MUSIC GROUP, I am still waiting for the majors to come to the plate with some big records."
Among popular genres, country has shown the most significant drop-off so far this year: Album sales dipped 26.1% to 37 million units, from the 50.1 million units the genre generated in the first three quarters last year. A primary reason for country's decline, label representatives say, is the sluggish business experienced in 2007 at WAL-MART, where country sells a disproportionate amount of records. According to the WALL STREET JOURNAL, for 10 years through 2005, the mass merchant's sales gains at stores open at least one year averaged 5.2%. So far this year, WAL-MART's comparable-store sales are up just 1.3%
Country is also lagging behind other genres when it comes to transitioning to a digital retail model. Total digital album sales stand at 35.8 million downloads so far this year -- or 10.6% of overall album sales. That's up from the 22.6 million digital album sales accumulated during the corresponding period last year. But in country, digital album sales comprise only 5.2% of the genre's total album sales so far in 2007, less than half of the industry average.
Other genres underperforming digitally include Latin, where album downloads account for 1.5% of the genre's sales; classical, at 8.5%; R&B (including rap), at 6.4% of sales; and rock subcategory hard rock, at 9.6%.
The rock category as a whole, however -- and especially another of its subcategories, alternative rock -- is dominating the digital format. In 2007 so far, rock's digital album sales comprise 13.7% of that genre's total album sales, while alternative rock's digital portion stands at 15.7% of its total.