RECORDING INDUSTRY U.S. music sales continue to rebound from slump

Decreased sales forced companies to restructure and lay off employees.
LOS ANGELES (AP) -- Online file-sharing and other digital piracy persist, but a gradual turnaround in U.S. music sales that began last fall picked up in the first quarter of this year, resulting in the industry's best domestic sales in years.
Overall U.S. music sales -- CDs, legal downloads, DVDs -- rose 9.1 percent in the first three months of the year over the same period in 2003, according to Nielsen SoundScan.
Album sales were up 9.2 percent. Sales of CDs, which represent 96 percent of album sales, rose 10.6 percent. For the first time since 2000, two recording artists -- Norah Jones and Usher -- managed to sell more than 1 million copies of their albums in a single week.
"We've had a big run so far," said Geoff Mayfield, director of charts and senior analyst for Billboard Magazine. "Because we've had three years of erosion, at least for the first eight months of the year, it will be relatively easy for the industry to post increases."
Encouraging
The sales data are a bolt of encouragement to an industry hit by a three-year sales slump it blames largely on file-sharing. The downturn prompted a wave of restructuring by record companies and thousands of layoffs.
Cary Sherman, president of the Recording Industry Association of America, called the first-quarter figures "good news," but cautioned that the results were measured against a dismal period.
"The numbers of 2003 were down about 10 percent to 12 percent from the year before," Sherman said. "If we didn't have that kind of increase it would be really terrible."
U.S. album sales declined annually in the three years following 2000, the biggest year since Nielsen SoundScan began tracking U.S. music sales.
In 2001, sales were down 3 percent. The next year, sales dropped 11 percent. Last year, until September, sales were down 8.5 percent, but the pickup in sales at the end of the year narrowed the total decline for 2003 to less than 4 percent.
The burgeoning online music market accounted for the sale of more than 25 million tracks between January and March, eclipsing the 19.2 million tracks purchased in the last six months of 2003, according to Nielsen SoundScan.
Stores also saw gains. Chain stores' music sales were up 7 percent, while independent music retailers saw a 3 percent increase. Discount chains such as Wal-Mart, Target and Kmart posted a 13 percent jump in sales compared to the same period last year, according to Nielsen SoundScan.
Industry observers said no single factor has driven the turnaround.