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Digital music sales to outpace CD sales

My local paper reports “sales of physical music media (CD) are expected to fall 8 percent to 10 percent this year, while sales of digital music could climb 150 percent to 200 percent. Digital music downloads will not destroy CD sales overnight but something is clearly changing in the music industry. In the third quarter, Apple’s iTunes Music Store made it the seventh-largest music retailer (according to NPD)”. The NPD Group (sales & marketing firm), founded in 1967, provides global consumer and retail information that helps manufacturers and retailers make more informed, fact-based decisions in order to optimize their businesses.

Based on this article, it implies many new customers are moving "more toward" digital music and not CD music. Revenue record labels are also losing as CD sales decline. If one looks ahead 5 years, what happens to CD music? Will digital music improve so much that it will sound better than CD music? Are there plans in the works to make digital music sound better than CD music? Do you have any comments?
hgeifman
tobias
1,534 posts
 
You might see the emergence of "audiophile" download sites, which offer higher resolution downloads--at higher resolution prices, of course. But if they happen, they will be even less significant in the mareketplace than audiophile labels are today

Pabelson, I'm not so sure this prediction is correct, realistic as it may appear. I am told (in UHF mag) that Apple is looking for more bandwidth so as to be able to supply music in its lossless compressed format. Also, I think any price differential between lossy and lossless downloads is not likely to be so great that it turns away most music buyers.

If download sites really want to take the CD's business, all they need is the ability to sell lossless-format music files. My guess is that's where we're going.

As a side note, that would mean the market for CD-only transports will dry up entirely, but makers of outboard DACs with USB inputs will see a sales upswing.
plato
1,543 posts
 
Tobias, I think you're totally right... Hey, I'll give you $100 for that old, obsolete Teac transport you have there...
tobias
1,534 posts
 
You're a truly generous man Plato, but since these CD-only units are going to get scarcer and scarcer, I believe my T1 will have collectible status shortly :o)
johnnyturbo
39 posts
 
I am using a single disk denon 1520, circa 1987, playing through a reflection audio modded benchmark dac1 and the sound is just plain exquisite. a wonderul old piece of equipment-- rapidly gaining antique status. i am presently moving towards a second, hd, system usting itunes, with an outboard usb dac. change change change. gotta keep the old and the new.
pabelson
344 posts
 
About Apple, I hope it's true, but I'll believe it when I see it. At some point, bandwidth may be fast enough and cheap enough that it doesn't matter how big download files are, but we are very far away from that point right now. Apple Lossless would require 5-6 times the bandwidth. To replace half of all CD sales would take a 20-fold increase in downloads. So you're talking about needing more than 100 times the current bandwidth, simply to replace half of all CD sales with CD-quality downloads. It'll come, but don't hold your breath.

Besides, what Apple really needs bandwidth for is video. If they had more bandwidth right now, which do you think they would do with it: make their music files larger, or offer more and longer video content?
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