Christmas sales down on last year.

High street retailers assess damage, as official figures reveal disappointing festive sales

by Martin Talbot

The music industry enters the New Year hoping to bounce back from a Christmas season which appeared to fulfil all the fears of the doomsayers who have been voicing concern at the decline of the physical business.

Music retailing's biggest name, HMV, went into the festive season fearing the worst, issuing a profit warning on December 20 which indicated that the value of the UK music market - physical and digital - had declined by 14% during October and November.

"The outcome of the peak trading period will be determined over the remaining two weeks," the company added. HMV declined to comment further - ahead of a full trading statement which is due on January 11 - but the picture did not get any rosier.

OCC data indicates that the overall albums market declined by 4.3% in unit terms in the four weeks leading up to December 23, led by a 6.7% slump in the artist albums market. And declining instore prices during 2006 are likely to result in a slump in overall market value well into double digits.

The final week leading up to December 23 saw 7.918m artist albums sold, according to OCC, down 7.6% on the 8.572m sold in the equivalent week of 2005. Overall, sales in the four weeks leading up to Christmas were down 6.7% to 22.530m units.