My top 5 reasons for declining CD sales:
1) Lack of a decent new music. Rock is now formuliac and a mockery of its former self. I'm not a Hip Hop fan but its been around long enough I imagine its getting there or only a matter of time.
2) CD's have been around a long time. People build their collections years ago. Now they only need to buy new stuff they like. Without a new physical format how do you get people to buy their collections over (aka vinyl, 8track, cassette, cd).
3) Mixing Quality has gone to the gutter. Modern mixing now cranks up all the different frequencies which limits quality. Anything mixed past the end of 90s is pretty weak.
4) Digital Downloads - Now that record companies are pushing crap. People don't have to buy the whole album. So instead of sell an entire album at 12.99, they sell one song for a buck.
5) Online Piracy.