We can't come up with a viable reason of why the price cut would happen now, so deep into the game when it seems like record labels are nearing complete extinction. It could be a last ditch effort on the part of Universal, but for all we know, it's a calculated move they'd been planning to make for several years.
There's no denying digital music downloads are the wave of the future, regardless of questionable audio quality or lack of secure backups. Most people can't even tell the difference between the two mediums, and the majority of people don't really care in the long run because, for them, being able to shop for Beyonce in sweatpants is infinitely more enjoyable than doing the same thing at the record store.
Universal is banking on one thing: we as human beings put more value on physical products. It's a long shot, but it might work if other companies follow the steps Universal has taken and decrease their physical media below the cost of a digital download. The test here isn't so much figuring out what the American public wants though -- it's getting people back in the record stores.
Record stores do feature one thing digital stores can't: excessive advertising. Sure, digital stores can have banners or little ads, maybe a featured artist or recommendation system, but nothing is going to beat the 13-foot Lady Gaga cutout or the prominently featured end-cap filled with new releases. Universal is hoping impulse checkout purchases will come back into play once their entire catalog is below the $10 mark. It's a risky decision, but could be a wise one in the end. Either that, or they're completely out of ideas and willing to lose money on the physical media. But we doubt it.
It's could also be a great combatant to used sales. By sinking the overall price, people could be less likely to sell and therefore decrease the used selection in stores.
It wouldn't be unheard of for CDs to have a miniature renaissance with the economy in the state it's in. We know a good number of people who don't have auxiliary inputs in their car stereos that will be happy to hear this news, if nothing else.
What do you think? Is this enough to get you back into the stores? Or did you even stop buying CDs to begin with?