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17 Million Fewer CD Buyers in 2008
March 17, 2009
Thomas Mennecke
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Remember that round, flat disc people used to buy? You know the ones that a laser pointed at and produced digital music? They're called CDs, if you don't remember, and they represented the way people listened to music before the Internet gave the People's Elbow to the music industry. Things aren't getting any better, as the latest survey from the NPD Group found that 17 million fewer people purchased CDs in 2008 compared to 2007.

So why are fewer people buying CDs? That's a loaded question that every side of the file-sharing debate has an answer for. However, looking at the progression of technology from 1989 to 2009 should give a clear understanding. In those years, portability improved dramatically. Consider this - if you're about to take a day out on the town, which would you rather carry around, an iPhone or a portable CD player?

And with that reasoning, it becomes rather clear why CDs have not been able to keep up after a tried and true 20+ year reign as the music format of choice. The music industry tried everything they could to thwart the transition to computer/internet based music distribution, including suing the manufacturer of the RIO MP3 player, suing Napster and suing consumers. In the end, technological progress won and now the CD is quickly falling into obsolescence.

But there is some good news. Whether you're a fan of P2P or a fan of authorized music stores like iTunes, digital music is clearly becoming the avenue of choice for consumers. According to the NPD Group, "Internet users paying for digital music increased by just over 8 million in 2008 to 36 million Internet users. Purchases of online digital music downloads increased by 29 percent since last year; they now account for 33 percent of all music tracks purchased in the U.S."

While this increase does show a silver lining, there is the inevitable downside to this news. Although the percentage of digital music buyers increased, there was an overall decline in the number of people buying music. NPD found that 13 million fewer people purchased music in 2008 compared to 2007 - thanks largely to a whopping 19% drop in CD sales.

The recession could be influencing the consumer's purchasing habits, although the availability of free online music is a more likely rational. The NPD Group found the popularity of music listening on Pandora and social networking sites increased substantially from 2007 to 2008.

So overall…more people are buying digital music, but the overall percentage of people actually paying for music continues to slide. People have many choices, P2P, iTunes, Amazon, Walmart, Pandora, MySpace, and so on. But sorry CD…we hardly knew ye.

This story is filed in these Slyck News categories
File-Sharing/P2P Related :: Studies/Research

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