In a move to recalibrate the functionality of the company, WEA, the global distribution, marketing, sales and research arm of Warner Music Group, has sent buyout letters to about 130 employees dealing with physical product. The move appears to be in reaction to the declining CD sales in the U.S. in 2017 and in anticipation of a similar decline in the current year.
Sources say that WMG didn't specify its targeted reduction goals, but it's likely aligned with the 19.6 percent reduction in CD sales, as counted by Nielsen Music, for 2017, and also taking into account a similar anticipated decline for the current year. With the savings generated by the move, WMG is expected to redeploy the funding to the growing streaming business model. According to sources, employees have about 45 days to make their decision.
Even with the move, WMG is expected to continue to issue and service physical product to retailers as the company manages the decline of the CD format, which is progressing unevenly throughout the globe.