“Tower Records has filed for Chapter 11 bankruptcy protection from its creditors, its second such filing in less than three years,” The Associated press reports. “The company, which operates 89 stores in 20 states, sought bankruptcy protection Sunday to sell its assets through a court-supervised auction.”
“The company admits “intense” competition has hurt its business and that of other music retailers,” AP reports. “‘The brick-and-mortar specialty music retail industry has suffered substantial deterioration recently,’ Tower said in court papers… Phil Leigh, a senior analyst for Inside Digital Media Inc., said the Tower brand has value and will find a buyer, but its stores aren’t likely to survive this latest bankruptcy. ‘I think they’ll sell off the name and liquidate the inventory,’ Leigh said.”
AP reports, “Legal music download retailers like Apple Computer Inc.’s iTunes have played a major role in displacing traditional retailers. Nielsen SoundScan data, cited by Tower in bankruptcy-court filings, said legal digital downloads grew 200 percent in 2005 while album sales fell 7.8 percent.”
Full article here.
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