CNN/Money reports that the demise of the CD has been exaggerated, at least for now.

Music CDs may not be headed the way of Betamax videotapes after all — at least not yet.

Suggesting reports of the compact disc's demise may have been greatly exaggerated, sales of music CDs are on the rise again. According to Nielsen SoundScan, Americans bought nearly 300,000 CDs in the first quarter, up 8.5 percent from a year earlier.

The sales uptick, which actually began near the end of last year and has since held steady, means 2004 could see the first increase in CD sales in two years. The growth comes amid signs that the rate at which consumers buy from online music stores like iTunes, an Apple Computer (AAPL: down $0.13 to $30.95, Research, Estimates) service, appears to be flattening.

The music industry claims that its strong-arm litigation tactics against music downloaders (i.e., suing individuals who used various file-sharing services to download music) has caused people to stop downloading files for free - and has generated the bump in CD sales. Indeed, there have been a number of reports that the number of people using file-sharing services has dropped, so there may be a correlation. At the same time, however, some studies (such as this one, jointly sponsored by the Harvard Business School and the University of North Carolina) indicate that file-sharing services may not have been the primary reason for the decrease in CD sales.

Even some music industry analysts think CD sales dropped for other reasons:

CD sales dropped in recent years, they said, because the economy slumped, leaving music to compete with video games, DVDs and other forms of entertainment for consumer dollars. They noted, too, the dearth of fresh talent as the teen pop fad began to wane around 2000.

Mayfield said a similar situation arose in the early 1980s after the red-hot Disco craze fizzled without any new genre emerging. Then, as now, there was much hand-wringing over consumers getting music for free — via blank cassettes, not computers.

They cite a "strong" economy and job market (psst, don't mention that to the Democrats, okay?), together with a reduction in CD prices and popular new music, as the real reasons for the increase in CD sales.

There has long been a cry that the music industry has been insensitive to its consumers, has charged too much for music, and has generally been unresponsive to consumers' desires for such things as downloadable music. In the file-sharing context, there are those who suggest that most people who download a song and don't ultimately buy a CD probably wouldn't have ever bought a CD anyway, so there's very little actual economic impact from the services.

The record industry disputes that argument, and certainly if they had done nothing in the face of the P2P threat the situation might not have stayed that way: in general, two years ago the mindset of many people I knew was, "Why buy a CD when I can get it for free online?" If that mindset had become the prevailing attitude, today's studies about the effects of file sharing might well be different.