Online music purchases aren't saving the music industry. MarketWatch is reporting that in the first three months of 2007, physical music sales fell by a staggering 21.5% compared with the year prior. Total music sales fell 12.5%, indicating that the surge in buying music online isn't helping enough.

"Analysts say despite widespread adoption of digital music devices and the growth of mobile-based music, digital isn't providing a silver bullet for the music industry's woes. Worse, latest music industry data shows that while digital sales are still growing rapidly, they aren't anywhere near offsetting physical declines," according to the report.

"The industry has pinned its hopes for top line recovery on sales of digital downloads, but we believe this faith is misplaced," said Enders Analysis in a research note published in March. "Digital sales cannot replace the library renewal and building that sustained the music industry's top line surge throughout the 1980s and 1990s as the CD was introduced."

Digital downloads aren't helping music's woes [MarketWatch]