The record industry as we know it is dead. Offline CD sales were 7.2% down in 2005, in contrast to digital download sales of music. According to Rolling Stone, sales of digital tracks increased from 141 million in 2004 to 353 million in 2005. And 2005 was the first time in history that online record sales outsold CD sales.
Great news for iTunes. But what we’re seeing here is also great news for Independent musicians. The long tail effect is definitely in place here. The greater choice of music available because of the internet means that people do have more to choose from than Mariah Carey or Britney Spears, and they’re choosing it. As a result, Independent labels grabed a greater share of the music market, while the major labels struggle.
Music industry 2.0 is here. The public now have instant access to any music that they can possibly want. The power is no longer in the hands of the few.