Traditional CDs — out of tune

Last week, Trans World Entertainment, which operates over 972 retail stores, announced their Q1 earnings — music sales were down by 21%. Music which represented 53% of their business a yaear ago, now represents 44%.

Late last year, Tower records closed their doors for good.

It was reported in January, that 2006 overall CD sales fell by 5% from approx 619 million units to 588 million, with Independent stores feeling the brunt of the change, down by 18% and mass merchant sales down 4%. On the other hand, digital track sales in 2006 increased over 2005 by 65% to 582 million tracks. We all know that this was not enough to overcome the drop in CD sales.

Regardless of any other business management issues, retail music stores are victims of the larger issues around consumer interest in traditional CDs. It will only get worse unless the labels and artists deliver new approaches to the traditional CD.

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