Business & Real Estate

Best Buy will stop selling CDs this year, Billboard reports. Target might do the same

FILE - In this Tuesday, Feb. 9, 2016, file photo, a shopper carts his purchased LED TV at a Best Buy in Miami. Billboard has reported that Best Buy will cease selling CDs as of July 1, 2018.
FILE - In this Tuesday, Feb. 9, 2016, file photo, a shopper carts his purchased LED TV at a Best Buy in Miami. Billboard has reported that Best Buy will cease selling CDs as of July 1, 2018. AP

As of the middle of this year, those looking to buy physical copies of their music will likely have at least one fewer brick-and-mortar option.

Sources told Billboard that Best Buy will stop selling CDs at its stores on July 1 of this year.

Citing unnamed sources – who estimated that the company pulls in $40 million a year from CD sales – Billboard also said Best Buy will continue to sell vinyl albums and turntables for at least the next two years, as per an agreement already in place with vendors.

Billboard further reported that major retailer Target has issued an “ultimatum” to music and video suppliers, saying it will carry inventory on a consignment basis or not at all. In other words, Target intends to pay suppliers only for the CDs and DVDs that it sells, shipping the unsold items back to them. The deadline for that ultimatum would be either April 1 or May 1 for music suppliers, according to Billboard’s sources.

Regardless of how Target’s deal with music suppliers shakes out, “it’s evident that we’re about to see significantly less music on major retailer shelves in 2018,” writes Salvatore Maicki of music blog the Fader.

The music industry’s transition from physical products to digital streams is apparent and rapid. Nielsen Music’s midyear report for 2017 found a 62 percent increase in on-demand music streaming compared to the first half of 2016. Physical album sales, meanwhile, fell 17 percent last during the same stretch.

As for the industry, the most recent Global Music Report by the International Federation of the Phonographic Industry observed a 7.6 percent decrease in physical revenue and a 17.7 percent increase in digital revenue, both globally, in 2016.

However, physical sales still make up more than 53 percent of all album sales, according to a mid-2017 report by Digital Music News. But that report also found that CD sales fell about 4 percent over the previous year, and added that CDs “may not fade away anytime soon.”

They may not fade completely, but CDs are making their way out of retail shops. Starbucks, for example, stopped selling CDs in early 2015.

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