Nielsen Soundscan data shows that CD sales have plummeted to the lowest numbers the industry has ever seen.  U.S. music industry sold a total of 4,984,000 albums during the last week of May, marking the lowest sales figure since Soundscan began compiling this data in 1994.

So after all the record store days, new album pricing, special editions of albums, the result is still the same, no one is buying CDs!  The industry has simply refused to accept the inevitable truth – technology has passed this industry by, and instead of embracing this technology in the late 90’s, they shunned it. 

Ten years later, it seems the record industry still has not learned from their mistakes.  In the wake of this news, Universal Music Group Distribution president Jim Urie could only reference internet piracy as the main reason for the decline.

“[This is] all the more reason why everyone in the industry should be focused on getting the U.S. Congress to introduce legislation that makes the Internet service providers our allies in fighting piracy,” Urie said.  “Piracy is getting worse and worse and the government needs to focus on that."

Without question internet piracy is an issue that needs to be addressed, but it’s no where near the issue it once was, and likely has very little to do with low CD sales.  The real problem lies in the options that consumers are given in the music industry today.

For years music fans would hear a song they like, and then proceed to buy the CD because that was their only option to own the song.  Now, fans can log onto iTunes, Amazon, or even right on their mobile phone and download just the song that they want.  Why spend $12 when you can just spend $0.99? 

And there lies the big dilemma that music industry hasn’t solved, and may not ever solve.  Your final product costs 99 cents, not twelve dollars.  No wonder why you can’t make any money.  Most record companies make between $6 and $7 for every album sold, and less than 65 cents for every song sold on iTunes.

Similar reports for the same week in May show Digital track sales totaled 21.7 million.  It doesn’t take a genius to do the math and realize record companies are losing a lot of money, with no relief in sight.

That is unless you ask the labels, who still seem to be in denial of their ill fate.  They say the say the last week in May was just a slow week, without enough new big name releases.

"This week is likely a major aberration with no big new releases out," Urie says. "June will be big. Look at all the big records coming out, including Sara McLachlan, Drake, Miley Cyrus, Eminem and Jack Johnson."
Time will tell, but one would have to guess most Miley Cyrus fans aren’t running to the store to pick up her new album later this month.