Digital drives rise in US music sales

Nick | 03 Jan 2009, 09:24

Album sales down overall

Nielsen’s annual US market report shows that overall music sales rose in 2008 despite a drop of 14% in sales of physical albums.  The uplift was driven by a rise in digital album and single sales of 32% and 27% respectively, which took the total number of downloaded songs past the 1 billion milestone for the first time. These figures are expected to reflect an overall decline in the US music market, even after alternative revenue streams such as licensing and artist 360 deals are taken in to account.

“You can see the overall unit sales as a positive, but their model is really built on album sales and that just continues to decline,“ said Silvio Pietroluongo, director of charts for Billboard magazine. “Music consumption has never been at a higher clip, it’s just a matter of trying to turn it into revenue,“ he added.

The LA Times reports that:

“Universal Music Group remained the industry’s big dog, with a nearly 32 percent share of the album market, followed by Sony BMG Music Entertainment, at 25 percent. Warner Music Group claimed 21 percent of sales, and the smallest of the major labels, EMI Music, had a market share of 9 percent.“

Meanwhile, The Times (UK) predicts that figures for the UK market in 2008, due out later this month, will show that:

“Total UK music sales will have fallen to £1.33 billion, if the 10 per cent decline is confirmed. However, executives were hoping that Christmas success of Take That’s The Circus, and the single sales of Alexandra Burke’s Hallelujah would improve the picture, reflecting the fact that sales of the top albums are holding up.

“A spokesman for Universal Music UK, the record company behind Amy Winehouse, said: “Ten years ago, an album just getting in the Top 20 would end up selling 75,000 copies. But today, it’s going to sell about 50,000 – and when the market is down like that, it makes finding the big hits more important. It is the middle of the market that is weakening.”

“Last year, global sales fell to their lowest level since 1986, and this year’s continuing decline in the UK and US – two of the top three markets – will see the industry hit another low.“