The German recorded music market has reported a decline in overall revenue for the 10th year in succession, but CD albums have not seen the double-digit year-on-year decline of other territories.

In Berlin today (March 19), the German music industry trade body Bundesverband Musikindustrie (BMI) announced a decline of 4.7% in revenues in 2008, down to €1.575 billion ($2.16 billion) compared to €1.652 billion ($2.26 billion) in 2007.

Last year 222.9 million CD, DVDs, downloads and ringtones were sold, compared to 230.4 million units in 2007 - a fall of 3.25%. Since 1999, there has been a fall of 51.6% in unit sales.

BMI managing director Stefan Michalk reported that Germany has managed to consolidate its second place in Europe behind the U.K.

At 81% of the market by revenue, the CD remains by far the largest revenue mainstay in the German music market. If all the physical audio formats, including singles, DVD-Audio and SACD, music cassettes and LPS are added together, they account for 85% of revenues. Sales of music videos account for a further 8%.

With 145.1 million CD albums sold, sales in 2008 were down 3.5 million units or 2.35% on the previous year. In 2003, 146.8 million CD albums were sold and sales of the format have remained almost constant over the past five years.

"While in other countries CD sales have slumped drastically, the process of transformation from physical to digital is advancing much more slowly in Germany," said Dieter Gorny, CEO of BMI. "The industry has enhanced the attractiveness of the CD with lavish editions, well-made booklets and attractive additional content, such as videos."

Music videos recorded a decline, with 11.7 million units sold in 2008, almost two million fewer than in the previous year.

Gorny is encouraged to see that the album is finding more fans in the digital market, too, although overall sales are small. Sales of digital albums grew by 50% from 2.6 million units in 2007 to 3.9 million units in 2008.

The second most popular music format is the single download, with 44.6 million units sold in 2008. This means that the number of music downloads has increased by a factor of six over the past five years.

Downloads are forcing the physical single out of the market. Whereas 10.7 million physical singles were sold in 2007, in 2008 the figure was only 7.6 million. However, ringtones have lost ground, with 4.1 million sold in 2008, less than half of the previous year's figure.

In 2008, Internet mail order, download shops and mobile music jointly accounted for 25.7% of all sales, up from 24.8% in 2007. Download stores such as iTunes or Musicload significantly increased their market share from 3.6% in 2007 to 5.1% in 2008. Internet retail via providers such as Amazon or gained 0.8% to reach 19.1% market share in 2008.

In the physical retail sector, specialist electronics stores further consolidated their leading position. Their share of revenues increased year-on-year by 0.5% to 30.2% of the retail trade. These were followed by drugstores, which also increased slightly by 0.1% to 8%.

By contrast, food retail outlets are losing a little of their importance. Their share of revenues has dropped from 8.2% in 2007 to 7.6% in 2008. The biggest revenue losses were recorded by department stores and superstores as well as in the classical mail order business. At 6.1% in 2008, the share of department stores and superstores in music sales has halved since 2002 (12.%).

Gorny reported that among the labels the number of employees dropped by 2.9%, from 8,650 in 2007 to 8,400 in 2008. The wholesale and retail music industry has also shed more jobs. "With 17,000 employees, the number of those employed in this sector has also decreased by around 3% year-on-year," he said.

Four out of ten Germans (39.6%) buy music at least once a year, according to the BMI. Of these, the largest group by purchasing habit comprises occasional buyers. They buy one to three music products a year and 25.9% of the total population falls into this category, followed by average buyers who purchase four to nine products a year (9.4% of population).

The figures show that 4.3% of the population are intensive buyers, who purchase more than nine music products a year.