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Apple's iTunes grows to No. 2 U.S. music retailer
February 27, 2008 / 12:03 AM / in 10 years

Apple's iTunes grows to No. 2 U.S. music retailer

NEW YORK (Reuters) - Apple Inc’s iTunes digital media store edged out Best Buy Co and Target Corp to become the second-largest U.S. music retailer, behind Wal-Mart Stores, according to data released on Tuesday from tracking firm NPD Group.

<p>A customer checks out Music Store (on a screen) with Apple iTunes at an Apple store in Tokyo, August 25, 2006.. Apple Inc's iTunes digital media store has become the second-largest U.S. music retailer, behind Wal-Mart Stores, according to data released on Tuesday from tracking firm NPD Group. REUTERS/Kiyoshi Ota/Files</p>

Based on 2007 sales, legal music downloads now account for 10 percent of music acquired in the United States, but the increase failed to offset a decline in physical CD sales, NPD said.

The amount of music purchased by consumers rose 6 percent from a surge in digital music sales. But actual spending rates across the industry declined by 10 percent due to lackluster CD sales, dropping from about $44 per capita to $40 among Internet users.

About one million consumers stopped buying CDs in 2007, according to NPD.

The iTunes store now has more than 50 million customers and has sold more than 4 billion songs, Apple said in a separate statement.

Reporting by Michele Gershberg and Kenneth Li; Editing by Lisa Von Ahn, Phil Berlowitz

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