CD sales hard hit by closure of music stores

Album sales are down 11% from the midpoint of 2007, while digital sales continue to grow at a steady pace.

Physical and digital album sales reached 204.6 million units in the 26 sales weeks between Dec. 31 and June 29, according to Nielsen SoundScan.

CD sales have been a prime culprit in the sales dip, as they are off more than 16% from 2007 levels, which were significantly down from the year prior. Sales of CDs have been hit hard by the closure of musicstores such as Virgin and the reduction of shelf space at big-box stores such as Best Buy and Target.

Digital sales, however, continue to grow dramatically. Digital album sales are up 34% to 31.6 million units, which represent 15.5% of all album sales.

Digital tracks spiked 30% as 524.7 million have been sold to date, a 125.4 million unit increase from 2007.

As much as album sales are slumping, they took an even bigger pounding in the first half last year. The January-July total in 2007 was 229.8 million units, down significantly from the fairly comparable first-half numbers of 2006 (298.7 million) and 2005 (298.4 million).

The four majors are all within a percentage point of their first-half market share standings in 2007. Universal Music Group leads at 31.2% followed by Sony BMG at 25%, Warner Music Group at 20.9% and EMI at 9.1%. Indies account for 13.9% of the marketplace.

The top three albums released this year all happen to be distributed by Universal: Lil Wayne’s “Tha Carter III,” which has sold 1.5 million copies; Jack Johnson’s “Sleep Through the Static” (1.2 million); and Mariah Carey’s “E=MC2″ (1.1 million).

Among the leaders for other labels are Leona Lewis’ “Spirit” (830,000) and Usher’s “Here I Stand” (806,000) at Sony BMG; the “Juno” soundtrack (828,000), Madonna’s “Hard Candy” (570,000) and Danity Kane’s “Welcome to the Dollhouse” (510,000) at Warner Music; and Coldplay’s “Viva La Vida” (971,000), Lenny Kravitz’s “It Is Time for a Love Revolution” (213,000) and Lady Antebellum’s self-titled debut (165,000) at EMI.

Lewis’ “Bleeding Love” is the year’s biggest-selling track to date, having been downloaded 2.6 million times.

Sales of vinyl albums are up dramatically as well: 803,000 have been sold in 2008 vs. 454,000 in ’07.

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