Disney Music Group Thriving in a Struggling Music Industry

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In a music industry where CD sales are lagging in the advent of digital downloads and online piracy, the Disney Music Group is showing tremendous growth with the success of recording artists Rascal Flatts and Miley Cyrus and the High School Musical phonomenon. Once the joke of the recording industry, Disney's record labels are showing the big boys how it's done.

A Cinderella story for Disney Music Group
By Dawn C. Chmielewski, L.A. Times Staff Writer

For more than a decade, Walt Disney Co.'s Hollywood Records was an industry joke.

Now, it and Disney's other labels are having the last laugh at a time when the rest of the beleaguered music industry has little to smile about.

Last week, 14-year-old Miley Cyrus bested "American Idol" star Kelly Clarkson with "Hannah Montana 2/Meet Miley Cyrus," which debuted at the top of the Billboard 200.

That album's success makes for something of a trifecta for Disney Music Group. Last year, Disney's Nashville label had the nation's top-selling artist in the superstar country band Rascal Flatts. It also scored the top-selling CD with the soundtrack for the Disney Channel's "High School Musical" phenomenon, which sold 3.7 million copies.

"The Disney Music Group and Hollywood Records are sort of comeback kids at a moment where everyone else is having a tough time holding their position, much less gaining ground," said Eric Garland, chief executive of BigChampagne, an online media measurement firm.

Elsewhere in the embattled music business, global CD sales have fallen for seven straight years. Digital technology has made copying music, as well as pirating it, a simple task, and the advent of Apple Inc.'s iTunes means people can easily download their favorite songs without buying an entire album.

Disney Music's strategy has been to court an audience that its larger rivals have mostly ignored — children and preteens, whose parents still buy CDs. It's also leveraged the potent partnership it enjoys with the Disney Channel, a veritable launching pad for "tween" stars.

Full Story: A Cinderella story for Disney Music Group