It may be a narrow margin, but digital music sales dominated the music market in 2011, accounting for 50.3% of all music purchases.

Each year, The Nielsen Company & Billboard release sales data tracking purchase and play patterns. 2011 marks the first time digital sales have exceeded physical media sales and, much to the relief of an industry plagued by piracy, general sales were up as well.

CD sales went down 5.7% from 2010, while digital album sales went up an impressive 19.5%.

The steady decline of CD purchases comes as no surprise to those keeping an eye on the industry over the past few decades; earlier this year, Digital Music News produced a handy infographic to illustrate the decline of the disc from 1980 to the present. Like the cassette and 8-track, it appears the CD is being edged out by easier, cheaper new media.

Head over to Businesswire to read the full 2011 report, which includes info on top selling artists and genres. Here are some highlights:

• For the first time, total music purchases reached the 1.6 Billion mark for the year.
• Total Album sales were up for the first time since 2004 (1.3%) with sales totaling 330.6 million, compared to 326.2 million in 2010.
• There were 228 million physical album sales in 2011, a decline of 5% over 2010. This is significantly less than the 19.5% decline in 2010.
• While there were a number of album genres that had saw growth over the previous year, 3 smaller genres experienced double digital growth in 2011: Jazz, New Age and Electronic grew by 26%, 16% and 15%, respectively.
• For the first time, digital music sales are larger than physical sales; accounting for 50.3% of all music purchases in 2011.
• Digital track sales set a new record with 1.27 billion sales in 2011; an increase of 100 million sales (8.4%) over 2010.
• Digital album sales exceeded 100 million for the first time with a new all-time high of 103.1 million sales (up from 86.3 million in 2010); an increase of nearly 20%.
  • Digital album sales accounted for nearly 1 out of every 3 album purchases (31%) in 2011; compared to 26% in 2010, 20% in 2009, 15% in 2008, 10% in 2007 and 5.5% in 2006.

It should come as no surprise to savvy Austinites (who help make Record Store Day a smashing success year after year) that, despite the poor sales of CDs, vinyl is more than just a retro trend — it’s a moneymaker for smaller stores and labels:

• For the fourth consecutive year, more vinyl albums were purchased than any other year in the history of Nielsen SoundScan.
  • In 2011, vinyl album sales reached 3.9 million in sales, shattering the previous record of 2.8 million LP album sales in 2010.
  • Note that 67% of all vinyl albums were purchased at an independent music store during 2011.
  • Vinyl album sales in 2011 were up 36% compared to 2010 and accounted for 1.2% of all album sales.
  • Nearly three out of every four vinyl albums purchased in 2011 were a Rock album.

Did you buy any CDs last year, or did you download all your new tunes? Are you ready to make the switch from discs to digital?