A Strong 2011 Holiday Season Could Bring Music Business First Positive-Sales Year Since 2004
A Strong 2011 Holiday Season Could Bring Music Business First Positive-Sales Year Since 2004

This year, U.S. album sales were up at the mid-year point, the first time that has occurred since 2004, the last positive sales-growth year posted by this country's music industry.

For the week ending July 3, album sales totaled 155.5 million units, up nearly 1% from the nearly 154 million units scanned during the corresponding first half of 2010, according to Nielsen SoundScan.

Just as importantly, digital track sales have seen robust growth, jumping 10.6% to 660.8 million units, up from 597.5 million units in the corresponding period last year, when digital song downloads barely finished with positive growth.

The top-selling albums of 2011 so far

The top-selling digital songs of 2011 so far

Consequently, with album and track sales both up, the industry's current main barometer, albums including track-equivalent albums (TEA)-whereby 10 tracks equal one album unit-also enjoyed healthy growth in the first half, with a 3.7% gain to 221.5 million units, up from 213.7 million units in the corresponding period last year.

Overall sales are up 8.7% to 817.7 million units versus 752.4 milllion units the first half of 2010.

Catalog albums-those titles out for more than 18 months that are not in the top half of the Billboard 200 or active at radio-led the charge in album sales, with sales of that album category up 7.2% to 72.6 million units as compared to the 67.6 million generated in the corresponding period last year.

Current albums, however, were down 3.9% to 82.8 million units from the 86.2 million units scanned in the first half of 2010.

Showing the decline in current albums so far this year, only two albums have sold more than a million units: Adele's "21" has scanned 2.5 million units and Lady Gaga's "Born This Way" stands at 1.54 million. In contrast in 2010 at the mid year point, five albums had accomplished that feat, led by Lady Antebellum's "Need You Now," with 2.36 million units.

In 2011, the same two albums also lead in digital album sales, with the former's mid-year count at 992,000 units and the latter at 750,000. Last year the best-selling album was MTV's digital-only release "Hope for Haiti," which had scanned 371,000 units.

Katy Perry's "E.T.," which features Kanye West, with 4.12 million scans, is the best-selling digital song so far this year. So far, 2011 has seen 52 songs reach the million-unit mark, of which 17 tracks were at 2 million or more. Last year, 39 songs had reached the million-unit mark by mid-year, and 14 of them were at 2 million or more, with Train's "Hey Soul Sister" leading the way with nearly 3.4 million units.

By configuration, digital album sales grew 19.3% to 50.3 million during the first half of the year, up from 41.2 million tallied in 2010's corresponding period; just yesterday, Eminem's "Recovery" was announced as the first album to pass 1 million downloads, and Adele's "21" will probably follow suit next week. The CD album sales declined slowed considerably during the first half of the year to a 6.5% drop to 103.3 million units, down from 110.5 million in the first six months of 2010. That 6.5% drop compares to a 17.9% decline in CD album sales between 2010 and 2009. In fact, CD sales were down 12.5% at the end of the first quarter, and in the second quarter CD album sales of 51.4 million units actually grew by nearly 1%, or to be exact 0.8%, up from nearly 50 million units scanned in the second quarter of 2010.

Looking at it another way, CD account for 66.4% of album sales while digital albums account for nearly about 32.3%. Vinyl album sales grew 41.2% to 1.88 million, but still only account for 1.2% of U.S. album sales.

But when you look at album sales with track equivalents, which this year totaled 221.5%, the digital format accounts for 52.5% of album with TEA; CD albums comprise 46.6%; and vinyl .85%.

Looking at where music is sold, the non-traditional sector holds a commanding lead, accounting for 42.3% of album sales. In the first half of the year, album sales for that sector grew 18.6% to 65.9 million units from 55.5 million in the corresponding period last year.

While the other store sectors posted declines in the first half, their pace slowed considerably. Chain merchants such as Barnes & Noble, Best Buy and Trans World Entertainment saw their album sales experience an 11.3% decline in the first half of 2011, compared with a 33% decline in the first half of 2010. Mass merchants such as Walmart and Target suffered a 7.9% decline versus a 13% decline for the first half of 2010; and indie stores were down 6.7% in the first half.

Last year that sector showed album sales up from the prior year, but that was due to a change in the definition of indie stores, which resulted in regional chains like Newbury Comics and Bull Moose being moved out of chains to the indie-store sector.

Billboard will have much more on SoundScan's mid-year sales figures this week -- stay tuned.