iTunes Devours A Quarter of US Sales, Digital Sales Will Equal CD Sales

iTunes continues to climb its way up the ladder to their final destination: Total domination in sales.

They’ve made a few changes here and there with the 3-tier pricing but it seems like it hasn’t phased digital consumers out there one bit. According to a release statement the NPD Group, Apple’s iTunes accounts for 25 percent of all music units sold, up from 14 percent in 2007 and 21 percent in 2008.

Russ Crupnick, entertainment industry analyst for NPD, states, “The growth of legal digital music downloads, and Apple’s success in holding that market, has increased iTunes’s overall strength in the retail music category.” This is very true, except we’re not sure how steady the rate of legal or illegal downloads will be.

So, iTunes is at the top of their game and physical CD sales are dwindling because no one wants to pump in the money into packages and jewel cases anymore. Actually, you’ll be surprised to hear that it’s not entirely true.

Digital sales may be going up, but physical CD sales are not drastically dropping as the industry predicted. In fact, Crupnick says,”The importance of the big box retailers shouldn’t be dismissed, as long as the majority of music consumers continue to buy CDs.” This particular majority that still goes out to those big-box sellers buy at Wal-mart (who takes 20 percent of physical sales), Best Buy (taking 16 percent) Target, and Amazon (both taking in 10 percent).

However, the industry has made another prediction based on this realization. If the digital sales keep growing as they do and CD sales continue slightly declining, there will certainly be a plateau. The NPD believes that “digital music sales will nearly equal CD sales by the end of 2010.”

We all know what’s coming next. After that plateau, there will be a switch in which the digital sales completely outrank the physical sales. No more CDs. Just download heaven: Convenient, better for the environment, and right at your fingertips… right?

Earlier in the year we asked what you preferred most: mP3s, CDs, or vinyl. Most of you chose mP3s. Do you still stand by your decision? CDs will be gone but do you think they’ll make a comeback like vinyl did? Sure, most vinyl sales are limited editions these days, but we wonder: Will CDs ever become a form of nostalgia?