Music downloads, subscriptions overtake CD sales for the first time

“Revenue from digital-music downloads and subscriptions edged out those from CDs for the first time in 2014, holding overall sales steady at about $15 billion globally, a trade group said,” Ethan Smith reports for The Wall Street Journal.

“Sales of CDs and other physical formats declined 8%, to $6.82 billion, while digital revenue grew nearly 7%, to $6.85 billion, the International Federation of the Phonographic Industry said in a report on Tuesday,” Smith reports. “Each of those represented 46% of overall music revenue. The other 8% came from sources such as radio airplay and licensing songs for television shows and films.”

“Subscription services generated $1.57 billion, or 23% of digital revenue; ad-supported services were 9% of digital revenue. Their combined 32% of digital revenue is a sharp increase from 2013, when they represented 23% of digital revenue. Download sales declined eight percentage points from 2013, but were 52% of digital revenue,” Smith reports. “The overall stability comes after years of steep declines in world-wide music sales, which peaked at $40 billion in 1996.”

Read more in the full article here.

MacDailyNews Take: Once music cartels could no longer hold desirable music hostage by bundling it with twelve throwaway tracks o’ crap and charging $15 or more for the forced bundle – which they called the “album” – etched onto a 3-cent plastic disc in a 10-cent box with a 15-cent booklet. By debundling the album and giving customers the à la carte option to finally be able to purchase music’s intrinsic salable base unit, the song, Apple gave music buyers the power and took it away from the forced bundlers, thank Jobs!

In the face of rampant piracy and “free” music, Apple (Steve Jobs, to be specific) saved the music industry. That peak of $40 billion in 1996 was generated via forced bundles, it was an artificial peak based on an artificial construct (bundling), that took place before the advent of widespread broadband Internet use, and certainly should not be used to compare pre-torrent days versus today’s reality. There wasn’t a “decline” as much as there was a reformation. With music basically available free for the taking today, that the industry is still capable of generating $15 billion in annual music sales is nothing short of a miracle. The music industry should genuflect to Apple daily.

Related articles:
A decade of iTunes singles saved the music industry – April 28, 2013
Album sales again hit record lows as sales of digital download sales continue to increase – August 27, 2010
Music labels forced anemic-selling ‘iTunes LP’ concept on Apple in exchange for DRM-free tracks – March 9, 2010
Apple: We do not charge a production fee for iTunes LP – October 13, 2009
Inside the new iTunes LP format – September 15, 2009
Apple’s new TuneKit framework (used in iTunes LP and iTunes Extras) has Apple TV written all over it – September 14, 2009
Apple releases iTunes 9; featuring iTunes LP, Home Sharing, Genius Mixes & more – September 09, 2009
Major music labels preparing new digital album format – August 11, 2009
Former Pink Floyd manager slams Apple’s iTunes Store for ‘debundling the album’ – November 19, 2008
Third Eye Blind vocalist: Albums are an arbitrary concept; unnecessary in digital age – October 21, 2008
Estelle quietly returns to Apple’s iTunes Store as Warner fails to force bundle (album) sales – September 10, 2008
Warner kills Estelle by pulling songs from Apple’s iTunes Store in attempt to force album sales – September 02, 2008
Apple iTunes Store’s ‘Complete My Album’ is a marketing tool – June 28, 2008
Jermaine Dupri: We made iTunes, not Apple; no more singles, buy albums or we’ll take them away! – November 27, 2007
Apple throws weight behind music cartel’s efforts to prop up faltering album format – March 29, 2007
Apple debuts new iTunes Store ‘Complete My Album’ service (advertising masquerading as a feature) – March 29, 2007
Apple plans iTunes credit for purchased singles if customers later buy album – March 26, 2007
WSJ: Music sales take sharp plunge – March 21, 2007


  1. This only happened last year? I thought it probably happen a fews years earlier. I buy a reasonable number of songs on iTunes Store every year. I haven’t directly purchased a music CD in more than a decade (although I’ve received some as a participate in a few music-related Kickstarters).

    I buy iTunes Store electronic gift cards (for myself) at a discount. Typically, I find deals priced at $75 or $80 for a $100 gift card. That means $1.29 songs are back to costing about 99¢ per song again, as Steve Jobs intended! 🙂 (It’s also good for all types of digital media sold by Apple, including movie rentals on Apple TV, apps, ebooks…)

    1. I do most of my music buying from iTunes. I do buy CDs of local and independent musicians at concerts, to help support them. I usually get the CD covers signed, and include the ticket stub with the CD. 🖖😀⌚️

  2. As morbid as it may sound, it is true. This is one of those things that death takes care of. As the older generation dies out, the, “digital generation” will continue to ascend. Eventually we will die and the next generation will get their music in a different way, still. I think we sometimes take for granted the fact that technology has evolved so much in the past 30 years.

  3. I used to subscribe to Pandora. Since then YouTube has become my chief source of music. Just the other day I couldn’t get “All Along The Watchtower” out of my head. I kept humming it while playing Call of Duty Advanced Warfare. When a song pops into your head, it’s almost with certainty that you will find it on YouTube.

    And as far as new artists…


  4. I wish you folks at MDN looked beyond top 40 crapola when talking about the concept of album or cd.

    Good artists make good albums. Period.

    The music industry is a good mirror of the US – a very small percent make most of the money, while the majority produce good work for little money or attention.

    1. I’m one of those that supports local musicians like Copperbox, Janet Planet, et al, and independent label musicians like Steve Smith, Candye Kane, and others by purchasing their CDs (see previous comment) to support them. 🖖😀⌚️

    2. A good album is a thing of beauty. This is one of many reasons I disagree with piracy apologists: they’ll tell you that recorded music isn’t important because you can make a living performing live. Well, most of the albums I love the best are products of the studio, works of art that don’t necessarily translate to a live show.

      I still buy albums whenever I can. I love iTunes because it keeps me from buying bad albums. Once I’ve sampled three or four tracks off an album and liked them, I buy the whole thing.


  5. This household still buys >80% of its music on optical disc. There are high fidelity download music stores, but they are rather limited in selection. The quality of files available on iTunes is poor, and obviously the vast majority of Apple’s music is mainstream crap that the big American labels foist on the kids with no musical skills or taste.

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