Mercury Records, the label home to U2, The Killers and Arcade Fire, is to stop the production of physical singles.
Except for on “rare occasions” the label is to rely almost entirely on downloads for its singles output.
Mercury lost money on singles releases in 2010. It will now only create physical singles when, according to company chiefs, “it is guaranteed to make a profit,” reports the Daily Mail.
The label is also home to Elton John, whose 1997 single ‘Candle In The Wind’ remains the biggest-selling UK single of all time.
Figures compilied by the Official Chart Company earlier this year showed the recent decline in sales in the UK. In 2006 sales of seven-inch single totalled more than a million, but by 2010 the figure had fallen to 152,000 – an 85 percent drop.
Increased manufacturing costs have meant that less money is being made from the formats. The cost of dealing with excess stock wiped out any profits that Mercury made on singles last year.