It's not a bolt out of the blue, but CD sales are in trouble and downloads from services such as Apple's iTunes Music Store are the culprits behind the drop.
According to new research from Ipsos Insight, fewer consumers 12-years-old and up are buying musical recordings on compact discs. Fifty-one percent of these consumers bought a CD in the past six months, a 15 percent decline from 2002.
According to a report by the Chicago Tribune, record company executives and music sellers came together this week during the National Association of Recording Merchandisers convention to try and figure a way to put an end to the slide in CD sales.
One of the responses to deal with the competition from downloads are machines in stores that consumers can use to burn single tracks to a disc. Machines allow consumers to pick approximately 15 cuts from one or more artists and burn them to a CD in the store.
The Trib spoke with George Daniels who runs George's Music Room in Chicago.
"I love the idea of this machine because it puts me back in the singles business," he told the paper. "It will add something new to our store. A lot of people are willing to pay $1 or $2 for a song, but not $15 for a CD."
Another retailer, Dan Kealy, said his business (Replay Music, Movies and Games) has really benefited from the four burning machines in the store.
"We're bringing in new customers every week with this," he told the Trib. "Once the customer uses it, they are hooked. They love creating their own compilations."
An added benefit of the machines, said retailers, is that stores can now carry a greater inventory of product without having to use the space that would be needed if physical inventory needed to be kept on hand.
Price remains a factor for many consumers when it comes to CDs because they still need to buy the blank and pay for labeling. This typically adds on an additional $3 to the cost of music downloads (99 cents per). In the future, stores expect to offer consumers the option of downloads directly to an MP3 player doing away with this cost in the process.
Discussion Question: Can machines that download music and burn it to a CD or MP3 player help stores recapture some of the share lost to services such as Apple's iTunes Music Store?