"The continued growth in legal download sites is encouraging, yet the industry struggles to improve the value of each digital customer," said NPD analyst Russ Crupnick in a statement. "With so many baby boomers and gen-Xers entering the market, there are certainly opportunities to sell more digital albums, promote older catalog titles, or create bundles that will raise revenues. In the near term that’s going to be the best means available to narrow the gap on dwindling CD revenues."
Unfortunately the news wasn't as good for labels as it was for Apple. The increase download revenue didn't offset the continuing decline in CD sales. No doubt part of the problem is that downloads are typically sold one or two songs at a time, versus an entire CD. According to NPD, around a million people stopped buying CDs last year.
Written by: Rich Fiscus @ 26 Feb 2008 23:17