1 It started with napster
When Napster, a free music sharing service, was launched 60 million people downloaded it. Those people downloaded music free by accessing each other's hard drives. This new way of getting music resulted in the first dip in album sales.
2 Napster was taken down but people learned the trick
Even though Napster was taken down legally, people realized that they could download music for free from the internet using different methods. This sent album sales down a bit more.
3 Itunes changed the way people get music legally
iTunes was created by Apple and it allowed people to buy single tracks for 0.99$ instead of buying the full album. This gave the album industry another strong hit. (See Why Apple has very high quality standards?)
4 The internet boom strongly affected the industry
As the Internet boomed and millions of people had access to the internet, people were able to get the tracks they wanted in different ways and this led to a further drop in the album market.
5 From 1999 to 2009 Album sales were cut to half
In the 10 years between 1999 and 2009 album sales went from 14.6 billion to 6.3 billion.
6 Live streaming gave the industry another hit
As the internet's infrastructure became better, Live streaming services began to appear. The fact that people can subscribe to services that allow them to live stream music legally lowered the sales of albums even more.
7 Youtube allowed people to get the tracks they wanted
As Youtube became popular, many people began uploading new music tracks while others provided tools to directly download them from Youtube. (See Why is YouTube so popular?)
8 In 2014 Album sales fall to lowest ever in US
In the week ending Sunday 12 January 2014 only 4.25m units (CD and vinyl) were sold across the US. That was the lowest number ever recorded for album sales since 1991.
9 Only 257 million albums were sold in 2014
According to Nielsen Music, a company that provides statistics on music sales, reported that album sales fell another 11% from 2013 to 2014. Sales went down from 289 in 2013 to 257 million units in 2014.