It’s Over: The death of retail CD sales is upon us

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JB Hi-Fi have pulled the plug on CD Sales. Why ? They’re getting killed by online sales. Honestly is this at all surprising to people ? For years we’ve been gouged $30-$40 on albums that contain 1 to 2 great songs, 3 or 4 mediocre songs and a then completed with a bunch of fillers.

Singles are no better, at $5-$10 you might get a couple of B-side tracks, but usually they’re B-side for a reason.. because they’re crap !!

Online retailers (read: iTunes) give users the ability to choose tracks at their discretion, resulting at a much lower overall cost. Sure there’s the argument for that physical copy that might include lyrics, but ultimately that’s completely negated by the convenience of digital downloads.

Even desktop downloads are becoming outdated, direct-2-device downloads are clearly the future. The iPhone and many others are already offering this. So to buy your music, it’s as simple as pulling the device out of your pocket, searching for the song and clicking buy. 30 seconds later your listening to the music.

Today’s announcement by JB Hi-Fi will be the first of many by retailers to stop selling CD’s at retail. The only hope dedicated music stores like Sanity is to move online. Whilst they already have an online presence, they should be using this remaining time in retail to heavily promote their online site. They are of course in competition with the 10,000 pound gorilla – iTunes.

The other option for music retailers is to diversify they’re product range.. only problem is the natural extension is into other media like DVD. With Tivo and BlockBuster On Demand and again iTunes, already offering digital downloads that space is about to get even more competitive. Microsoft later this year will launch it’s 1080p movie streaming service via the Xbox 360, sure pricing is still to be announced, but good luck competing with that.

It truly is just a matter of time now before retail outlets like Target, K-mart, Big-W will switch out CD departments for other, more profitable merchandise. The question is how quickly these retailers will stop fighting the inevitable. Some will be pulled kicking and screaming into the new generation. The same goes for physical CD die hards, however if that’s you, you shouldn’t be too worried, there will still be CDs available at retail for many years to come, just be prepared to go searching for them.

There is of course still people selling records, this is exactly what will become of retail CD sales, small boutique, specialist stores that cater to a niche. Just don’t expect these to be in your local shopping centre, massive rent is the enemy of a dying business model.

Update
As discussed in the comments, JB Hi-Fi’s announcement is only related to the them ceasing the sales of singles. That said I doubt albums will be far behind.

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