Album sales fall, digital sales soar in U.S. last year

LOS ANGELES — U.S. album sales plunged 9.5 percent last year from 2006, as the beleaguered recording industry marked another weak year of sales despite a 45 percent surge in the sale of digital tracks, according to figures released Thursday.

A total of 500.5 million albums sold as CDs, cassettes, LPs and other formats were purchased last year, down 15 percent from 2006's unit total, said Nielsen SoundScan, which tracks point-of-purchase sales.

The shortfall in album sales drops to 9.5 percent when sales of digital singles are counted as 10-track equivalent albums.

The number of digital tracks sold, meanwhile, jumped 45 percent to 844.2 million, compared with 588.2 million in 2006, with digital album sales accounting for 10 percent of total album purchases.

Overall music purchases, including albums, singles, digital tracks and music videos, rose to 1.35 billion units, up 14 percent from 2006.

Music sales during the last week of 2007 totaled 58.4 million units, the biggest sales week ever recorded by Nielsen SoundScan.

The recording industry has seen CD album sales decline for years, in part due to the rise of online file-sharing but also as consumers have spent more of their leisure dollars on other entertainment purchases, such as DVDs and video games.

Warner Music Group artist Josh Groban had the best-selling album with "Noel." The album, a collection of Christmas songs, sold about 3.7 million copies.

A soundtrack for The Walt Disney Co.'s popular "High School Musical" franchise was second with about 2.9 million units sold.

The Eagles' comeback album, "Long Road Out of Eden," scored the third spot, selling about 2.6 million copies, despite being independently released and available for purchase only at Wal-Mart stores.

The recording industry continued to benefit from mobile music, with mobile-phone owners buying 220 million ringtones, the firm said.

Suit accuses Apple of music monopoly

Apple was sued by a California woman claiming the company illegally blocks competition for online music players and downloading songs.

In an antitrust complaint filed in federal court in San Jose, Calif., the woman accused Apple of maintaining a monopoly because digital music purchased through its iTunes music-downloading site can only be played on the iPod.

Apple doesn't support Windows Media Audio, a computer format used by non-Apple digital music players and online music sold through AOL and similar vendors, according to the complaint.

The woman seeks class-action status to represent other buyers in a group suit. She also asks for a court order barring the conduct and unspecified damages.

Susan Lundgren, a spokeswoman for Apple, said the company doesn't comment on pending litigation.

— Bloomberg News

Intertainer, Apple settle patent suit

Apple and online movie distributor Intertainer settled a patent suit over a method of distributing digital entertainment over the Internet.

Apple and Intertainer Thursday asked a federal judge in Marshall, Texas, to throw out the dispute over Intertainer's patented video-distribution technology. Terms of the accord weren't disclosed in the filing.

"They came to us with an offer, and we thought it was acceptable," said Intertainer Chief Executive Officer Jonathan Taplin. "I am very happy."

Intertainer developed technology to distribute movies on demand through the Internet for viewing on televisions and computers, according to Taplin.

Intertainer's investors included Microsoft and Intel, the world's biggest semiconductor maker. The company shut most operations in 2002.

The patent, covering a "digital-entertainment service platform" for managing and distributing digital audio and video from various suppliers, was issued in 2005.

Intertainer sued Sony, Universal and AOL in 2002, citing antitrust claims, to force them to abandon their planned competing Internet movie service. That case settled in 2004, according to Taplin.

— Bloomberg News