Thanks to a surge in digital downloads at sites such as Apple Computer’s iTunes store, music-industry sales (by units, at least) were up in 2006 compared with the year before, according to a report today from Nielsen Soundscan.
“We’re seeing a continued transition to digital music consumption,” Nielsen Music President Rob Sisco told Bloomberg News.
Consumers made nearly 1.2 billion music purchases in 2006, up 19.4 percent from just over 1 billion in 2006, according to the company’s data, which is based on point-of-sales tracking. That increase comes even as sales have dropped 4.9 percent of albums, whether by digital download or on CD and other formats that you can actually hold in your hands. Overall, the industry sold 588.2 million albums in 2006.
The difference comes from a surge in sales of digital tracks, which were up 65 percent to 581.9 million.
Album sales, meanwhile, are also shifting online, with sales of digital album downloads up 101 percent to 32.6 million and physical albums ordered online jumping 19 percent to 29.4 million.
By genre, rock, R&B and alternative led overall sales. The top-selling album was the soundtrack to Disney’s popular “High School Musical” telemovie. The top-selling artist was country group Rascal Flatts.
Silicon Valley tech stocks: Up: Cisco Systems, Google, Intel, Hewlett-Packard, Oracle, Apple Computer, eBay, Yahoo, Gilead Sciences and Applied Materials. Down: None of the top 10 by market value.
Technology stocks surged on the second trading day of the year, as Banc of America Securities said it now believes fourth-quarter earnings from Santa Clara chip behemoth Intel will be better than previously expected. Intel surged 82 cents, or 4 percent, to $21.17, for the steepest gain the Standard & Poor’s 500 index.
Investors also were pleased by a drop in oil prices below $56 a barrel. (Warm weather in much of the country is easing demand for heating oil.)
“People are thinking now that energy prices are coming down, that gives a chance for technology and other sectors to perform better,” Scott Fullman, Hapoalim Securities USA’s director of investment strategy, told the Associated Press.
San Jose online auction giant eBay and Sunnyvale Internet content powerhouse Yahoo also had stock gains exceeding 4 percent today.
It was a disappointing holiday for the nation’s retailers, but especially for San Francisco clothing chain Gap, which also owns Old Navy and Banana Republic.
Gap said today that comparable-store sales at its namesake chain were down 9 percent in December from a year earlier. (Comparable-store sales measure results at locations open at least a year.) Old Navy was down 10 percent. Banana Republic, though, was up 2 percent.
“Although Banana Republic continued to make good progress in its turnaround, we continued to experience negative traffic trends at Gap and Old Navy,” Sabrina Simmons, senior vice president of corporate finance, said in a statement.
That led to deep discounts to prod holiday sales at those chains, and those discounts will continue into this month as Gap and Old Navy try to clear out inventories of holiday merchandise. The company now expects earnings of 83 to 87 cents a share for the fiscal year, down sharply from the previous forecast of $1.01 to $1.06 a share.
Despite the grim outlook, Gap’s stock actually climbed today, closing at $19.44, up 13 cents, or 0.7 percent. Some investors are hoping the disappointing results will lead to the replacement of Gap Chief Executive Paul Pressler.
“Investors believe it’s going to force the board to re-evaluate the future direction and the CEO position,” David Katz of Matrix Asset Advisors, which owns 2.3 million Gap shares, told Bloomberg News.
Overall, the nation’s retailers reported a 3.1 percent gain for December, according to the monthly International Council of Shopping Centers-UBS tally. That met expectations, but for the November-December holiday season as a whole, sales were up 2.8 percent, slightly below the group’s earlier forecast of a 3.0 percent jump.
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, the Associated Press, Bloomberg News and other wire services. Contact Frank Russell at frussell@mercurynews.com.
