Music Industry

The world's largest music store, Apple's iTunes, plans to boost the price of many hit singles and selected classic tracks to $1.29 on April 7, breaking the psychological barrier of 99 cents in what could be the first big test of how much consumers are willing to pay to download individual songs. Although the date for higher prices has not been publicly announced, Apple has been notifying record labels it will go into effect on that date, industry executives said.

Starting today, the Anaheim Convention Center becomes ground zero for guitar geeks. It's the annual four-day trade show of the music products industry, and hotshot musicians from around the country will be there to check out the latest guitars, amps, electronic keyboards and digital recording gear. Staged by the Carlsbad-based International Music Products Assn., the event (and the trade group itself) still goes by its old acronym, NAMM, for National Assn. of Music Merchants.

First-week sales of U2's "No Line on the Horizon" brought the superstar rock band back down to Earth. The album, given the band's stature and sales history, was essentially preordained to debut atop the U.S. pop charts. The only question was how many it would sell. The Interscope album sold a brisk 484,000 copies in the U.S., according to data from Nielsen SoundScan, which tracks album sales.

Digital music downloads reached a milestone in 2008, exceeding 1 billion songs purchased online, according to a newly released report from Nielsen SoundScan, which tracks music sales. That represents a 27% gain over the previous year. But the soaring popularity of the 99-cent download is not enough to offset continued declines in CD sales, which still account for the bulk of the music industry's revenue. Physical disc sales fell nearly 20% to 362.

Leave it to brash punk-pop icon Green Day to inject some much-needed life into the U.S. pop charts. The band's latest concept-driven collection for Reprise/Warner Bros., "21st Century Breakdown," which was released off-cycle on a Friday rather than the typical Tuesday, sold 214,000 copies through Sunday, according to Nielsen SoundScan.

The stark realities facing the independent music sector threatened to cast a pall over the hard-partying revelry as the South by Southwest music festival began its second full day Thursday. Executives who gathered for the confab said they were grappling with the same sorts of fallout from the worsening economy and breakdown of traditional business models -- declining album sales, online piracy and rampant layoffs -- that have been afflicting their corporate counterparts for the last decade.

Broadcasters call the Performance Rights Act a tax. To the music industry, it's more like a royalty fee. But the legislation, which is gaining momentum in both the House and the Senate, is making radio stations nervous. For more than 80 years, commercial stations have aired songs without paying royalties to musicians.

U.S. consumers shied away from compact discs and digital video discs last year, and sales of Internet downloads failed to make up the difference. Album sales fell 15% to 500.5 million units, market researcher Nielsen SoundScan reported Thursday. In 2006, total sales fell 4.9%. The figures underscore the industry's failure to combat music piracy with a campaign of lawsuits and threats. Although digital album sales rose 53% to 50 million units, they represented only 10% of the total.

When you're not inclined to give away your product for free, make your customers believe that they're getting something for nothing. That's the thinking behind some of the offerings music fans may see this year as the recording industry scrambles to offset losses from plunging CD sales and find new sources of revenue when many people simply download music for free.

Universal Music Group and two other record companies sued Baidu.com Inc., China's most-used Internet search site, over illegal music downloads after a ruling against Yahoo Inc.'s music service in the country. Universal, Sony BMG Music Entertainment and Warner Music Group Corp. sued Baidu in Beijing on Monday, said the International Federation of the Phonographic Industry, which represents the companies. The record companies also sued Sohu.com Inc.