Are CDs Going The Way Of The 8-Track?

Virgin Megastore, CDs
Virgin Megastore, CDs
The song is over at Virgin Music Megastores.

The shuttering this weekend of Virgin's last two stores - in Manhattan and Hollywood - marks the death of a once booming chain - and another nail in the coffin of the music CD, reports CBS News correspondent Anthony Mason.

CD sales nationwide are down by half since 2000. So Virgin's parent company closed its 25 Megastores and is leasing the space to other businesses.

"Everything on these racks, though I don't like to say it, is available on iTunes, is available on Amazon," said Simon Wright, the CEO of Virgin Entertainment Group.

And that's where music sales have shifted. Apple's iTunes is now the nation's largest music seller - with 20 percent of the market. Amazon has about 8 percent. And some studies show most music is now downloaded for free illegally.

"The only reason people are coming here is because they like the buzz of it," Wright said. "They like the sound, they like the feeling, they like that they can hang put, pick things up and look at it."

Which leaves music lovers longing for that special browsing experience.

"CDs now are catering to fans who like the object, who like high sound quality of a CD, but then they also want the pictures and the booklet, and they want to look at the liner notes and the lyrics and the photos," said Michael Endelman, a senior editor at Rolling Stone.

Two years after the lights went out at the once mighty Tower Records chain, Virgin was the last giant standing. The void affects music fans, and artists.

"The death of the CD and the sort of shrinking of record labels makes it a lot harder for small acts and even for mid-level acts to get their music out," Endelman said.

And the big acts simply aren't selling albums like they used to. Back in 2000, when 'N Sync's album "No Strings Attached" debuted at number one on the charts - the album sold 2.6 million CDs in its first week.

This year, Green Day needed to sell only 600,000 copies of its "21st Century Breakdown" to hit number one.

"There's a huge generation gap in music," said Russ Crupnick, a vice president of NPD Group, a marketing research firm. "If you take a look at teens, for many teens the CD is to what an 8-track might be to me - it's an antique, it's an artifact."

An artifact, that's getting increasingly harder to find.

  • Anthony Mason
    Anthony Mason

    CBS News senior business and economics correspondent; Co-host, "CBS This Morning: Saturday"