2013: First Year of the Post-CD Era?

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Things haven't been looking good for CDs for years now. Ever since the introduction of Napster and the first portable MP3 players, the format has pretty much felt doomed. Since the turn of the century, the CD has hung on valiantly, but its disappearance has remained a question of when, not if.

2012, as it turns out, may have been the CD's worst year yet. Early in the year, it was reported for the first time that digital music had outsold CDs. Perhaps more interestingly, old albums outsold new ones in 2012 for the first time since Nielsen Soundscan started tracking U.S. album sales in 1991.

The CD's long reign as the music industry's main revenue source appears to be at an end at last. So, has the MP3 Prophecy finally come true? Will 2013 be the first year of music's post-CD era? And is that good news for the music industry or bad?

It may be a little early to bury the shiny silver discs just yet. Last year did see the release of some major CD hits, including Adele's soul juggernaut 21, which sold 4.4 million copies, and Taylor Swift's Red, which sold 3.1 million. One Direction had two albums top one million sales.

But even the top smashes seemed to indicate that the record industry is in a very weird place right now. For the first time in the SoundScan era, the same album finished as the top seller in the U.S. for two years in a row, with 21 towering above the competition in both 2011 and 2012.

It took one of the biggest albums in forever two years to sell 10 million copies. At the record industry's peak, the Backstreet Boys sold 11 million copies of Millenium in a single year. We're now firmly in the midst of music's Online Age, so it's hardly news that album sales are down. What's surprising is that they continue to exist at all.

Adele aside, album sales for 2012 were down about 4 percent compared to 2011. (CD sales took the biggest plunge, dropping by 13 percent.) It wasn't only iTunes and illegal downloading taking a big bite out of the CD pie, either. The real story in 2012 was the rise of music streaming services like Spotify, Pandora and others.

Spotify hit 5 million paying subscribers in 2012, and Pandora users logged a record number of listener hours on that service, too. With Apple set to (possibly) unveil its own streaming service soon, subscriptions could soon threaten the extinction of not only CDs, but MP3s as well. And there's still no telling exactly what impact cloud computing will have on media sales.

As if all this amazing new technology wasn't enough, CDs must also contend with another competitor that seems to be rising from the grave. For the fifth consecutive year, more vinyl albums were purchased than any other year in the Nielsen SoundScan era. Vinyl sales were up 19 percent last year compared to 2011, accounting for 2.3 percent of all physical album sales.

If CDs aren't quite ready to be buried, it's probably at least time to look into finding them a good nursing home. In the face of ever-increasing competition from a variety of formats, CD sales appear destined to slowly bleed to death rather than suddenly imploding. According to Nielsen, 193 million CDs sold in the U.S. last year, compared to 118 million digital albums. That's still good enough for a 63 percent market share of albums, but trending inexorably downward.

So hey, you can probably feel free to finally cancel that Columbia House subscription without fear of missing much at this point. But as long as artists and consumers favor bundling songs together into an LP package, the CD appears destined to hang around. For those of us with gigantic jewel-case collections, that's good news.

Yes, 2013 may indeed be the first year of the post-CD era, but keep handling those discs with care. They may still have to last you a while.

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