State of the Music Industry 2008
by Alex Cosper
The music industry in 2008 continues to operate in damage control mode. We still have not seen any
signs of a turnaround after a decade-long lull in music sales.
While a third of America still buys CDs from brick and mortar
stores, full length CD albums remain the most popular configuration for music buyers by a longshot,
CD sales have also been declining year after year. However, a review of the Recording Industry
Association of America's statistics shows that not all the news is bad. In fact, in the realm of
digital music the news is pretty good.
Prior to the launching of Apple's iTunes Music Store in 2004, digital music sales were non-existent.
In four short years iTunes was able to jump over established brick and mortar record stores and
retail outlets such as WalMart and Target.
In 2008 iTunes
became the top music retail outlet in the United States. The popularity of digital downloads
increased at a stunning rate in those four years from one percent of all music sales in 2004 to over
eleven percent in 2007.
The overall size of the U.S. music industry can be measured by units shipped at suggested list
prices. This equation gave the music industry a size of $13.7 billion in 1998. By 2007 the size had
diminished to $10.3 billion.