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NPD: Apple, Amazon Gain Q1 Music Share

5/26/2010 10:53:14 AM Eastern

Port Washington, N.Y. - Apple
extended its lead in music sales in the first quarter, while Amazon gained
share to tie Walmart for second place, an NPD Group consumer survey shows.

Apple's iTunes store accounted
for 28 percent of all unit music sales to consumers, up 4 percentage points from
the year-ago period, while Amazon gained 3 percentage points to tie Walmart for
second place with a 12 percent share.

 In calculating retailers' market share, NPD
measured sales of physical albums, digitally downloaded albums and downloads of
individual songs, with 12 downloaded songs considered the equivalent of one
album for comparison. Downloads include over-the-air cellular downloads but not
ringtone downloads. Surveyed consumers were 13 and older.

 NPD also found that digital downloads extended
their share of total music sales. Sales of digital tracks and albums accounted
for 40 percent of overall music market share in the first quarter, up 5
percentage points from the year-ago period.

 Amazon gained share in CD and digital formats,
NPD said. "This dual-pronged approach of selling both digital music and CDs
helps attract the most valuable and committed music buyer who prefers access to
both formats," said Russ Crupnick, NP industry analysis VP.

In sales of physical albums, Amazon's
share grew by 2 percentage points to 11 percent, putting the retailer into
third place. Walmart was on top with 17 percent of CD sales, followed by Best
Buy with 14 percent.

In downloaded music, NPD's
MusicWatch survey found that iTunes's share "remained essentially flat"
compared with the year-ago period, growing only 1 percentage point to 70
percent. The AmazonMP3 store, however, grew 4 percentage points to 12 percent.

Although iTunes' digital share
grew only 1 percentage point, its share of total music sales (physical and
digital combined) grew by 4 percentage points to 28 percent of all music sales
because of declining CD sales.

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