CD players 'play-on' in digital music age

With its low cost of inclusion into audio systems, compact disc (CD) players are still in tune with consumers despite the rise of digital music and networking technology, according to an analyst.

In an e-mail interview with ZDNet Asia, Ross Rubin, director of industry analysis consumer technology at The NPD Group said while the CD player is skipped in some home or car audio products in favor of network or flash storage or USB port for connecting to music files, the CD player is not at risk of becoming extinct.

"For example, in [audio] shelf systems there is usually plenty of room to include a CD drive and the cost is minimal," he pointed out. "The percentage of home audio systems sold without CD capability is quite small."

In car audio systems, a CD drive is sometimes needed for other purposes, such as playing a DVD for rear-seat viewing, added Rubin. "This may migrate to Blu-ray over time but [the player] will preserve compatibility with compact discs."

"We even continue to see lots of portable CD players sold even though the large manufacturers don't produce new models," he noted.

CD players still being manufactured
JVC Asia's assistant marketing manager Larry Wong said in an e-mail that the company still produces CD players but "at a much smaller volume than before". Such music players, he added, "are still quite in demand in Middle Eastern countries".

"Convenience and easy availability of music CDs are the contributing factors in sales and demand of CD players," said Wong. "Unless dedicated music retailers changes their way of selling music, for example selling individual songs via storage card or though [the Internet] like [Apple's] iTunes...the majority of the older generation and non-tech savvy consumers and audio lovers would still buy music the traditional way."

To boost sales of its products, JVC produces audio systems with built-in DVD players as they are then capable of playing both audio and movie discs, he added.

A spokesperson from Sony Electronics Asia-Pacific said in an e-mail that compact disc-related offerings "remain an integral part" of the company's product mix. "CDs are an alternative source of recorded music and may be used in conjunction with server-based systems to stream music throughout the home via a home network."

Moninder Jain, Logitech's director for South Asia, explained in an e-mail the appeal of songs captured on a CD: "For music purists the appeal of the CD probably lies in its analog quality which offers superior sounds due to the uncompressed media data. Listened through high quality equipment [including] speakers, amplifiers and the CD player, this is probably perceived as the best sound in the market today."

Yet, the portability of digital music is a "strong and desirable factor" for consumers, he pointed out. "Just take a look around [on public transport], or on the streets--digital music has filled the need for the masses who are looking for a seamless musical experience.

"When you add the ability to have those devices docked with speakers, FM radios, or alarm clocks, you will have a winning factor that is difficult to beat," he said.

Reliance on CDs hindering music industry
In a report released in December 2008, Mike McGuire, research vice president at Gartner said the reliance on revenue from sales of pre-recorded CDs is hindering the music industry from fully embracing online distribution.

McGuire noted in the report, titled "Christmas 2008: The Last Year of the Retail CD", that CDs were "expensive anachronisms because of the costs associated with maintaining physical inventory". The cost to manufacture the whole CD package--including the disc, liner notes, and jewel case--was, depending on the volume, between US$2 and US$4. These costs may escalate over time, he added.

With falling music CD sales and less floor space dedicated to the CDs, music labels ought to pursue a different tactic, said McGuire. "Music labels should emphasize 'digital first', making all new releases and catalog issues via digital services and moving CDs to an on-demand publishing mode".

To ease consumer discomfort, the music industry could sell albums on microSD cards as near-term alternatives to "pull balking consumers into the online distribution system", he suggested at that time.

However, despite the digital music push, McGuire noted that CDs will not "disappear altogether" and could be used as marketing or promotional tools that can be sold or given away at concerts.