The good news is that music sales are up. Overall units sold in Canada increased in 2008 by 11.5%. The bad news for the industry is that album sales are down, and album sales have the largest impact on profitability. Overall album sales dropped by 8.5%. Sales of digital albums rose by nearly 70%, but still represent only a fraction, less than 10%, of overall sales.
The cool thing, is that vinyl sales in the US (I can't put my finger on Canadian numbers) doubled in 2008 to 1.88 million units. I think we've all noticed vinyl on the merch table at more and more shows lately, often accompanied with a digital download. In the spirit of making music as accessible as possible through digital downloads but also providing value-added physical packaging to entice consumers to buy a physical product, vinyl seems to fit the bill nicely, and it seems that young music fans are leading this trend.