MP3 Sales Causing Drop in CD Sales

As iTunes sells over a million dollars in gift certificates since October, CD sales are down a full 15% since last year. Digital sales are taking over.

Just as vinyl record sales eventually reduced to nearly zero when the CD was introduced, many are saying that soon people will not walk into a store to buy a physical copy of the music they want to hear. Instead they will browse websites to learn more about the musicians, and then download the tracks they want to own, paying between 10 cents and $1 per song.

Most music lovers say they would gladly pay money for each song they listen to, to reimburse the singers and songwriters for their efforts. They simply want that process to be quick and easy.

The first CDs came out in 1982, when Sony sold the first CD player in Japan. The CD medium caught on immediately, as it was portable and reliable. The CD was far more damage-resistant than either the vinyl record or the magnetic tape. By 1992, over 1 billion CDs had been sold.

After a peak in 1996, CD sales began to decline as a saturation point was reached. The second half of 2001 saw 397 million CDs sold. In the first half of 2002, 369 million CDs were sold. That is about 60 million CDs a month.

In comparison, some estimate that 4 billion files are now downloaded each month by peer to peer users. 35% of these are estimated to be pornographic photos and videos, so accounting for other photos and files, probably 50%, or 2 billion, are music files. And at 10 tracks per CD, this means that 200 million CDs worth of music are being downloaded for free by users on a monthly basis.

Makers of iTunes and other online digital music services are hoping that these downloaders will buy their copies legally from websites that offer them at a reasonable price.

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