DIGITAL MIGRATION: Turns Out That The Reports Of The Album’s Death Are NOT Greatly Exaggerated


TORRENT FREAK: With this shift from physical to digital, another important change hit the industry, one that may in part explain why the labels’ revenues in the U.S. continued to decline. With the introduction of paid downloads, consumers no longer had to buy a full album if they were only interested in two or three songs. This new freedom for consumers has dramatically changed the music sales landscape. According to statistics taken from the RIAA shipment database, between 2004 and 2008 the number of single tracks sold in the U.S. increased by 669 percent while the number of album sales dropped 42 percent. Consequently, the income of the big labels suffered since single track sales are less profitable than full albums. As can be seen in the chart below, the number of music ‘units’ sold continues to grow rapidly nonetheless. MORE

RELATED: The best-selling digital single of 2009 was Lady Gaga’s “Poker Face,” with 9.8 million sales. (The Black Eyed Peas’ “Boom Boom Pow” gagaga.jpgwas tops in the United States, with 4.7 million downloads, according to Nielsen SoundScan.) Not surprisingly, the report has plenty of bad news about the state of the industry. Global revenue of recorded music fell 7.2 percent from the year before, to $17 billion, and is down about 26 percent from its peak in 1999. Sales of CDs and other physical products, generally the industry’s most profitable, continued to fall precipitously. “The bottom is still not in sight,” Billboard wrote in an analysis of the data. But the report also includes some promising signs. Digital music — growing strong in Europe, Latin America and in Australia and New Zealand — now accounts for about 25 percent of all revenue (in 2005 that figure was 5 percent). MORE

RELATED: The International Federation of the Phonographic Industry (IFPI) revealed that music sales declined 7.2 per cent last year to $17bn. It was around $38bn in 2000. MORE

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