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Best Buy will stop selling CDs as digital music revenue continues to grow

Best Buy will stop selling CDs as digital music revenue continues to grow

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Target says it will only sell music CDs under a consignment basis

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Best Buy is abandoning the humble CD and will no longer sell them in its stores starting on July 1st, 2018, reports Billboard. The move comes as CD sales continue to decline; revenue from digital music downloads eclipsed it back in 2014.

Target, on the other hand, says it will only sell music CDs under a consignment basis, shifting inventory risk back to the labels. That means Target would only pay labels for CDs when customers buy them, rather than buying the CDs in bulk and paying for shipments of unsold CDs back to the label for credit.

In a statement emailed to The Verge, Target said:

“Entertainment has been and continues to be an important part of Target’s brand. We are committed to working closely with our partners to bring the latest movies and music titles, along with exclusive content, to our guests.

“The changes we’re evaluating to our operating model, which shows a continued investment in our Entertainment business, reflect a broader shift in the industry and consumer behavior. We have nothing more to share at this time.”

Despite no longer selling CDs, Best Buy will still sell vinyl for the next two years, which Billboard says is part of a commitment it made to vendors. Sources suggested that Best Buy’s music CD arm was only generating $40 million annually.

As we’ve previously reported, during the first half of 2017, streaming services accounted for 62 percent of revenue from the US music market. The decline of CD sales has also sparked Warner Music Group to offer voluntary buyouts to its 130 staff working in physical product, according to Billboard.

It’s not surprising that we’re no longer buying CDs — at least not for new music. The best-selling CD in 2016 was a Mozart boxset, which contained 200 CDs that were individually counted as a separate sale. Users who don’t buy music prefer to stream it via services like Spotify and Apple Music, and gadget makers aren’t really making CD players anymore.

There’s still hope, though: vinyl has seen a resurgence in recent years, as has the cassette tape. And even though there aren’t a lot of new cassette players on the market, artists are still finding ways to release music through physical mediums (or at least a mix of both). For example, Korean artist G-Dragon released his latest album via USB drive.

We’ve reached out to Best Buy and will update this post if we hear back.