When is the last time you bought a cd? Besides taking up space on an already crowded shelf, most of the music I listen to is through the iPod. So I am more likely to download than purchase. At the same time, while I recently downloaded Camp Rock for my daughter, I burned the songs on a cdrom for her to play on the stereo. And once I finally upgrade the stereo to connect to the mac and play by itunes library, I'll stop burning cds altogether.
So it is not surprising to learn that my habits emulate the changes in the music business. Despite declining cd sales, download sales continue to rise at a steady pace. "Digital sales, however, continue to grow dramatically. Digital album sales are up 34% to 31.6 million units, which represent 15.5% of all album sales."
Brick and mortar stores like the once powerful Tower Records and Virgin have not adapted to change. Other stores selling physical copies of digital content, like Game Stop, should be careful with their growth plans, as games will soon be downloaded directly to devices. General merchandise stores like Target and Best Buy have already cut back shelf space in their music department, and can benefit from diversification of merchandise.
Once consumers becoming increasingly more comfortable with a digital copy of their audio video and audio content, they will no longer need to retain a physical copy in the form of a cd or dvd. That is the direction consumer purchases are taking and stores devoted to selling these copies will become part of our economic history, like HMV, Silo, Tweeter, Highland, and others that couldn't adapt to change.