I doubt that I owned more than 100 or so CD's 10 years ago, and I had no real sense that I was missing out on any music I wanted to listen to.
I now have 48 days of songs on my iPod, and storing the CD's is getting awkward. I buy more CD's all the time.
Digital music availability has produced a monster, together with the ability to browse discography websites and discover/buy obscure releases released in other markets you never knew existed before.
Heck, even very obscure material is being commercially released that has never previously been available.
The music industry isn't dying, but I think it's having some difficulty convincing some people that a mainstream pressed CD is worth $15.
Which could be viewed as justifiable skepticism, considering that commercial replication services charge ~30c for a pressed silver CD with printing on the disk and a jewel case front insert on orders of 10,000 e.g.:
http://www.newcyberian.com/