PORT WASHINGTON, NY, June 6, 2001 – Leading market researcher NPD INTELECT reported today that, over the past 15 months, sales of blank recordable CDs through U.S. retailers, mail-order firms and resellers had reached nearly 1 billion blank disks. For the first quarter of 2001, despite the documented sales slowdown in the computer industry, unit sales of CD recordable media rose almost fourfold and revenues increased by 76 percent, compared to the same period a year ago.

"Even as consumers slow their purchase of technology products they continue to find the advantages of CD recording compelling, as evidenced in the huge numbers of blank discs being sold each month," said Stephen Baker, director of research at NPD INTELECT. "The mainstreaming of this function will be tested over the next few months as CD makers and marketers implement recently announced price increases.".

These increases are already beginning to impact consumers, as the average cost per disc for CD media increased to 55 cents in March 2001, up 7 cents from the previous month’s figure of 48 cents. In addition, the average retail price for a 10-pack of CD-R discs climbed to $11 in March 2001, up $3 from February’s $8 average price.

"The growing need for more storage – for downloading music to archiving digital images - is driving sales of CD burners which in turn continues to drive sales of blank disks," Baker added. "Even as PC sales slow, CD burners are attaining the status of a checklist item for computer buyers. This is demonstrated by the impressive market share held by computers with pre-installed CD recordable drives."

The robust sales growth of aftermarket CD recordable drives is one of the factors driving increasing consumer demand for CD media. Retail sales of these drives grew 136.4% during the first quarter of this year, compared to Q1 2000.

Also, a greater number of computers are being sold with a CD recordable drive pre-installed. Retail unit sales of computers with a pre-installed CD recordable drive grew 15 percent over the year ago period. Unit sales of these systems represented 43.2 percent of total retail computer sales during Q1 2001, compared to 32.4 percent during Q1 2000.

Sales of home audio CD recorders are also fueling this trend with 71.1% growth during the first quarter of 2001 compared to the same period last year.

"As prices for audio CD recorders have fallen to affordable levels (April ASP $363) another nail is driven into the tape cassette coffin,." according to Jim Hirschberg, director of Consumer Electronics for NPD INTELECT.