Despite the success of online retailers, explosion of Internet downloads and high-profile closings of Virgin Megastores and Tower Records stores, bricks-and-mortar record stores aren't all spinning toward oblivion.

Although hundreds of independent music retailers have gone out of business in recent years, about 2,000 are still around, and many are thriving.

The survivors will celebrate Saturday, as acts such as Erykah Badu and Franz Ferdinand gather to pay homage to the hometown record store.

Record Store Day was the idea of Chris Brown, a long-haired, goateed music guru from Bull Moose, a chain of 10 record stores in Maine and New Hampshire.

"I wanted to have a fun kind of party event at Bull Moose where we could thank our customers and just have a fun time," he said. "I realized that it would be a much better party if we got the other stores involved, just make it a national thing."

Now in its second year, Record Store Day is being celebrated at more than 1,000 independent record stores in the U.S. and in 17 countries.

Artists like Disturbed and Ani DiFranco - both appearing at Bull Moose - are paying tribute with in-store appearances. Others like Bruce Springsteen, Elvis Costello, The Smiths, Modest Mouse and the Decemberists are offering special-edition vinyl releases.

For retailers, it's very different from the days when kids rushed to the store to thumb through the 45-rpm records. These days, more compact discs are sold despite a resurgence in vinyl. Record stores also have branched out into video games, movies and other merchandise.

Some like the Waterloo in Austin, Texas, Twist and Shout in Denver, and Amoeba in San Francisco are cultural hubs in their communities.
"Music is clearly the centerpiece. It's at the emotional heart of these businesses, but economically they've diversified," said Jim Donio, president of the National Association of Recording Merchandisers, which is sponsoring Record Store Day.

It hasn't been an easy road for the mom-and-pop stores.

About 1,000 indie music retailers have gone out of business since 2003, said Joel Oberstein, president of Almighty Institute of Music Retail, a market research firm based in Studio City, Calif.

But 2,000 independent record stores have survived, and the store closings have leveled off over the past year, Oberstein said.

Indies cling to a small market share. All told, there are 10,000 online retailers, mass merchandisers, national chains and other retailers, in addition to the hometown record stores. Donio estimated that independent stores account for less than 10 percent of overall music sales in the U.S.

Looking to thank customers and promote local stores, Brown tossed out his idea for Record Store Day in 2007 at a conference of indie music retailers in Baltimore.

A year later, heavy-metal band Metallica officially kicked off the first Record Store Day at Rasputin Music in San Francisco.

Brown is VP of Bull Moose, a seemingly incongruous corporate title that is nevertheless typical of indie stores that have adapted to marketplace changes. In fact, Bull Moose is coming off a record year and strong first quarter despite the recession, he said.

Its stores feature a variety of compact discs from jazz to metal to rap to world music, but also DVDs and Blu-ray discs, video games and video game systems, vinyl albums, T-shirts, baseball caps and more. There are also used DVDs, CDs and vinyl.

Julian Butler of Standish, who was shopping this week at Bull Moose's Portland store, said he used to download his music and movies - illegally and free of charge - before getting a cease-and-desist letter from his Internet service provider.

These days, he said he prefers the sound of compact discs to the compressed MP3 files, and he likes the social interaction he gets in the store.

"Mostly the sound quality is a lot better on CD and you're supporting the actual makers of the music," Butler said of his decision to give up illegal downloads. "Plus you get to come here and meet some people instead of sitting in front of your computer."