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Target Tells Labels They Only Want to Pay For CDs and Video After They Are Sold, Best Buy Ending CD Sales

by VVN Music

This could either be the final nail in the coffin for physical formats like CDs and DVDs or it could be huge sales boon for Amazon.

Billboard is reporting that Target is only interested in selling CDs and DVDs if it is on a consignment basis.  In other words, the companies would supply product for Target's shelves but would not get paid until the items are actually sold.

While CD sales have been dropping by double digit percentages over the last few years, that isn't the case in the rest of the world so the format is far from dead.  Last year, even with an 18% drop, it was not as big a dip as digital retailers saw for downloads.

Target has given their suppliers until either April 1 or May 1 to agree to the new terms. Billboard is saying that one of the three majors is leaning no while the other two are undecided.

The magazine added that Target once stocked 800 titles per store but now has less than 100 although they were responsible for over a half million in sales for Taylor Swift's latest album.

Outside of Target, its already known that the iTunes store will be going away sometime in the next couple of years as people are doing less and less downloading and Best Buy will discontinue CDs as of July 1.  They will still carry a selection of vinyl.

Where this leads, especially for artists, is problematic. The only real growth in the music industry is in streaming which is wonderful for the companies but is a disaster for the vast majority of artists. 

If Target and Best Buy get out of the CD business, that leaves Wal-Mart and small independents on the brick-and-mortar front and it wouldn't be beyond reason that, whichever way Target goes, Wal-Mart will follow.

That would mean Amazon could become the main source for physical music and, not matter what the media might tell you, there remains a market for CDs, especially in the form of back catalog.