Billboard // Recording Industry 2008 Sales Statistics
Glenn Peoples of Billboard.com Reports:
The IFPI (pdf) and RIAA (pdf) show continued losses in physical formats, varying success in mobile and slowing digital growth as markets mature. Fueled by a large drop in CD sales and lower wholesale values, North America led the four global territories (Europe, Asia and Latin America are the others) in total trade revenue decline.
North America had a total of $4.98 billion in recorded music trade revenue in 2008. That represented a drop of 18.6%. Trade revenue from physical – nearly all of it from CD sales – dropped 31.2%. The drop in trade revenue from physical formats is much larger than the drop in unit sales. Europe, whose digital market is less mature than the U.S. market, experienced a 36.1% increase in digital trade revenues while physical format revenues dropped only 11.3%. Globally, physical revenue dropped 15.4% and digital revenue climbed 24.1%.
A physical trade revenue drop of 31.2% in North America comes with several implications. First, the loss of physical format revenue was greater than the decline in unit sales. According to Nielsen Soundscan, U.S. CD unit sales dropped 19.7% in 2008. The RIAA has put the decline in retail value of U.S. physical shipments at 28%. The numbers show evidence of downward pressure on retail and wholesale prices that is compounding losses from format substitution. Consumers are switching from CDs, which offer the highest per-unit trade revenue, for digital albums and track downloads. The number of unique transactions is greater but the resulting revenue is lower. Continue Reading
