Music Downloads Don’t Offset CD Sales Slump

April 20, 2007

This article is included in these additional categories:

Media & Entertainment

Compact disc sales declines will not be offset by new revenues from music downloads for another two year, according to a report from media research company Enders Analysis.

Enders forecasts that overall music sales in 2009 will be half the level of the peak of the CD boom. Global music sales are forecast to fall to $23 billion in 2009, down 16 percent from 2006 and far below the forecast of $45 billion in 1997, according to Enders.

The decline in CD sales will likely result in more cost cutting at some major music labels as well as lean times for specialist music retailers. A 20 percent decline in CD sales in the first seven weeks of the year forced EMI in February to cut its earnings forecasts for a second time in just over a month, for example.

Enders predicts that CD sales will begin to stabilize in 2010, when penetration of MP3 players is expected to reach saturation.

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