Neilsen Soundscan is reporting that CD sales are increasing, yet the Recording Industry Association of America claim that business is bad. So what’s actually going on?
As reported in Digital Lifestyles last month, Neilsen is celebrating a 10% increase in sales, whilst the RIAA is still telling us that CD sales have plummeted because of copying and downloading.
It turns out that the RIAA’s claims are based on the total number of CDs shipped to record shops – not the numbers sold to customers, so this has no reflection on sales at all. Record shops are ordering less stock, but selling the stock they have faster. Having lots of cash sitting in your storeroom doing nothing isn’t good business sense when economies are suffering. Additionally, the RIAA also has a measure of control over the number of CDs shipped to stores, so it can influence the figure in any way it likes.
Soundscan recorded 146 million CDs sold in Q1 2003, against 160 million in Q1 2004 – an increase of nearly 10%. Figures for Q2, released this summer are expected to show yet another increase. The RIAA, on the other hand, are claiming a 7% decrease in revenue – but that’s purely through managing shipments and returns.