Music Sales in 2008

Yes, Lil Wayne topped the highest selling album in the US in 2008 with “Tha Carter III”.

But does that mean the music industry is back on its feet and roaring forward?
Well, turns out the rumbles about the music industry are true.

US album sales are down. 14% from 2007. Even within a scenario when more Americans bought music than ever before, they just weren’t buying albums. They were consuming singles.

How many units were actually purchased? 1.5 billion. This compared to 1.37 billion the previous year. But one thing to remember again is that those units are comprised of individual songs, not albums consisting of 12-16 songs.

However, things aren’t all bad. Digital sales surged 32%.

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According to the Nielsen Co.’s year-end figures, music purchases — CD, vinyl, cassette and digital purchases of entire albums (grouped together as total albums), plus digital track downloads, singles and music videos — attained a new high of 1.5 billion, up 10.5% over 2007.

More than 70% of those transactions were digital track downloads, a record total of 1.07 billion that swamped 2007’s previous high of 844.2 million by 27%. Last week’s track downloads set a record of 47.7 million, and 71 songs exceeded 1 million downloads this year, compared with 41 last year (and just two in 2005). Track downloads outsold albums by a ratio of 2.5 to 1.

Total album sales dropped to 428.4 million, 14% fewer than in 2007, and have fallen 45% since 2000. Even combining album and track sales (by a formula that counts 10 track downloads as one album sale), the 535.4 million total is still down 8.5% from 2007 and more than 30% below 2000’s physical album sales of 785.1 million.

Music purchases are “astronomically high,” says Rob Sisco, Nielsen’s president of music, “but it’s a marketplace in transition from physical to digital.” He sees promise in the rise of digital purchases of entire albums, which reached a high of 65.8 million in 2008. New albums by big acts bring the market up, he says, but “there hasn’t been a steady stream of high-profile releases.” Other ‘08 results:

Leona Lewis’ Bleeding Love was the year’s top-selling digital song with 3.42 million downloads.

Lil Wayne’s Lollipop also topped 3 million, by 160,000.

Rest of the top five:

Flo Rida’s Low

Katy Perry’s I Kissed a Girl

Coldplay’s Viva la Vida.

Lil Wayne’s Tha Carter III was the No. 1 album, selling 2.87 million copies.

Coldplay’s Viva la Vida or Death and All His Friends, Taylor Swift’s Fearless and Kid Rock’s Rock ‘n’ Roll Jesus were the only other albums to sell 2 million in 2008, compared with eight in 2007.

Swift, whose self-titled first album was No. 6 for the year, behind AC/DC’s Black Ice, sold 4 million albums overall, tops for any artist. Rihanna was the leader in track sales with 9.94 million.

Low is the all-time best-selling digital song, with 4.53 million downloads. The only other track above 4 million is Timbaland & OneRepublic’s Apologize, at 4.01 million.

Garth Brooks lost ground to The Beatles but is still by far the best-selling artist of the SoundScan era (post-1991, when Nielsen began tracking album sales electronically), leading the Fab Four by a tally of 68.1 million to 57.1 million.

Although vinyl albums gave way to CDs years before SoundScan launched, it’s worth noting that vinyl sales hit a 17-year high in 2008 with 1.88 million, up dramatically from just under a million in 2007. Radiohead’s In Rainbows was the top vinyl seller with 25,800 copies.

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While digital sales are up, vinyl sales are up, the entire industry is down. The bread and butter is gone, with only crumbs and It’s like taking a company like
What does this mean for the industry?
They have to find revenue streams fast.

Online advertising, paid partnerships and sponsorships and brand licensing are all at the tip of the iceberg which the record industry as tried but to a minimum. Will 2009 be a huge paradigm shift for the industry? I hope so.