Decline

In many Western countries, the market for cassettes has declined sharply since its peak in the late 1980s. This has been particularly noticeable with pre-recorded cassettes, whose sales were overtaken by those of Compact Discs during the early 1990s. By 1993, annual shipments of CD players had reached 5 million, up 21% from the year before, while cassette player shipments had dropped 7% to approximately 3.4 million.^[18] The decline continued such that in 2001 cassettes accounted for only 4% of all music sold. Since then, the pre-recorded market has undergone further decline, with few retailers stocking them because they are no longer issued by the major music labels.^[17] Sales of pre-recorded music cassettes in the U.S. dropped from 442 million in 1990 to 274,000 by 2007.^[19] In 2009, a record low 34,000 cassettes, and 2,000 of those albums were at least 36 months old, bought at independent retailers in the south Atlantic region, in the suburbs.^[20] Most all of the major U.S. music companies had discontinued them by late 2002 or 2003. However, as of 2010, blank cassettes are still being produced and are sold at many retail stores, and facilities for cassette duplication remain available. Cassette recorders and players are gradually becoming scarcer, but are still widely available and featured in a notable percentage of Hi-Fi systems.^[21]

Cassettes remained popular for specific applications, such as car audio, well into the 1990s. Cassettes and their players were typically more rugged and resistant to dust, heat and shocks than the main digital competitor (the CD). Their lower fidelity was not considered a serious drawback inside the typically noisy automobile interior of the time. However, the advent of "shock proof" buffering technology in CD players, the reduction of in-car noise levels, the general heightening of consumer expectations, and the introduction of CD auto-changers meant that by the early 2000s, the CD player was rapidly replacing the cassette player as the default audio component in the majority of new vehicles in Europe and America.

While digital voice recorders are now common, Compact Cassette (or frequently microcassette) recorders may be cheaper and of sufficient quality to serve as adjuncts or substitutes for note taking in business and educational settings. Audiobooks, church services, and other spoken word material are still frequently sold on cassette, as lower fidelity is generally not a drawback for such content. While most publishers sell CD audiobooks, they usually also offer a cassette version at the same price. In the audiobooks application, where recordings may span several hours, cassettes also have the advantage of holding up to 120 minutes of material whereas the average CD holds fewer than 80.^[21]

While cassettes and related equipment have become increasingly marginal in commercial music sales, recording on analog tape remains a desirable option for some, however that method is recently being overtaken by portable digital recorders. Musicians in the indie rockcommunity have showed slight interest in releasing cassettes. Artists such as Dirty Projectors and Deerhunter have made recent titles available on cassette,^[20] and Thurston Moore of Sonic Youth has claimed "I only listen to cassettes." ^[20]

Diamond Studios of Zimbabwe announced that it will establish a plant to mass-produce cassette tapes to be used as a means to counter piracy.

Still in 2000s, some schools use the format in their education.

Among the last in the developed countries to leave the compact cassette format are artists and groups belonging to the "dansband" genre, who many still in the early 2000s had released their albums both to CD and to compact cassettes. Since many of their fans now are older, they often belong to a generation who was less interested in buying a CD player. However, also in this genre fewer artists and groups release recordings on compact cassette. As late as 2006, Lasse Stefanz and Torgny Melins released their latest albums to both Compact Cassette and CD