Downloads show no quarter-to-quarter increase.
While overall U.S. sales are up a whopping 22.8% to 814.5 million units from the first nine months of 2005, digital track downloads, the main configuration fueling that growth, are stagnant when viewed on a quarterly basis.
Unlike last year, when digital tracks increased steadily by 9.2 million units between the first-quarter total of 76.2 million units and third-quarter total of 85.4 million units, this year’s second- and third-quarter downloads of 137 million for each period are less than the 144 million units downloaded in the first quarter, according to Nielsen SoundScan.
Yet for the nine-month period ended Oct. 1, digital track downloads totaled 418.4 million, a 71.3% increase over the 224.2 million accumulated in the corresponding period in 2005. Likewise, this year’s nine-month total also represents a 6.2% increase over the 393.9 million albums scanned during the same time period.
Album sales, including those in the digital configuration, are down 5.2% to 393.1 million units from the 414.8 million scanned in the first nine months of 2005. CD sales are down even more, 8.1%, to 368.9 million units. On the plus side, digital albums posted the largest configuration increase on a percentage basis to finish up 114.2% to 22.6 million: slightly more than double the 10.6 million units generated in the first nine months of 2005.
So far this year, 28 albums have each sold more than 1 million units. Meanwhile, only 10 songs have passed the million-unit mark—led by Daniel Powter’s “Bad Day,” which has scanned 1.8 million.
Looking at market share (including catalog), Universal Music Group remains the leader with 31.3%, even though it has slipped slightly from its 31.7% in the first nine months of 2005. UMG’s album total is 8.7 million units off of last year’s pace, with a total of 122.8 million units so far this year.
UMG also remains the leader in current market share, with a 33.9% slice of the pie. It also is the leading distributor in the classical, hard rock, jazz, R&B, rap and Latin genres.
Buena Vista Music Group, distributed by Universal Music Group Distribution, remains at the top of the heap with the top two album sellers so far this year. The “High School Musical” soundtrack is No. 1, with 3.1 million scans, followed by Rascal Flatts’ “Me and My Gang,” with 2.5 million.
Although big things are expected from Sony BMG Music Entertainment in the fourth quarter, so far this year the company’s market share has eroded to 26.8% from its 27.2% in the first nine months. Sony BMG, however, is the largest country album distributor during the first nine months of the year.
The only major label showing an increase in market share is Warner Music Group. At the end of the nine-month period, the company tallied 19.2% in market share, good enough for a nearly 5-million unit increase in scans to 75.6 million. WEA is the largest component of that increase, with market-share growth of more than one percentage point to 15.8%, although Alternative Distribution Alliance also posted a slight increase. The June acquisition of Ryko Distribution contributed another 0.07% to this year’s total.
EMI and the independent labels continue to suffer market-share erosion.
Looking at sales by store type, nontraditional outlets—which include online digital and CD album sales, concert sales, mail order and TV 800-number sales—continue to show a market-share increase, at the expense of other sectors. So far this year, nontraditional merchants have seen sales increase 49.2% to 46.1 million units.
Chains, which include stores like Best Buy, Borders Books & Music, Tower and Trans World, suffered a 13.5% decrease to 163.2 million units. While they remain the largest store sector, mass merchants keep closing the gap, even though that sector suffered a decline in a year-over-year comparison. Last year, at the end of nine months, an 28.4 million-unit gap separated the two store sectors (188.6 million units for chains versus 160.4 million units for mass merchants) while this year the gap has dwindled to 6.5 million units (163.2 million units versus 156.7 million units).
Independent stores continue to decline as well, posting the largest drop to 27.1 million units, down 22.3% from the 34.9 million units generated in the first nine months of last year.