THE date 1 January 2007 has been hailed as a watershed in the history of recorded music in Britain. From now on, the 'release' of a single no longer has to be supported by a physical product in record stores. If a certain song is being downloaded by enough people it will make it into the charts regardless of when it was recorded.

If Jermaine Jackson proves to be a hit in Celebrity Big Brother, it is conceivable that his most famous song, 'Signed, Sealed, Delivered', could be charting any day now.

Lord save us.

However, the development is merely the embalming fluid for a market that has been long dead but which has nonetheless prompted some amusing moves to engineer new number-one hits.

British DJs last week began campaigns to take old songs into the charts by encouraging the public to download them. Meanwhile, EMI, the world's third-biggest record company, issued a profit warning due to shrinking sales of CDs by its top artists such as Robbie Williams, and threatened to completely ridicule the whole idea of a singles chart by making every Beatles single available for download later this year, possibly in a deal with iTunes.

Can you remember the first 7-inch single you ever bought? If you are over 30, the chances are you can and it is a fond memory, one that you still have physical evidence of somewhere in your collection. What about the first CD single you bought? It's not the same, is it?

In truth, the singles market has been all but dead since the first iPod came out in 2001. The 'radio edit' single, usually only made available for radio stations with a few token copies for the shops, just stopped selling. How could you have a b-side when there was only one side? Extra tracks began appearing as hidden tunes on the end of the full CD release - and no one noticed the difference.

While dedicated vinyl-loving artists still produce the 12-inch for those that want them, one of the biggest losers in all of this is the humble record shop and the notso-humble giant record chains.

HMV is in trouble and Tower is a distant memory in the US. The whole pie of the music business is getting smaller and smaller each year as digital music is increasingly embraced - downloads now account for about three quarters of the singles market, with many of them illegal (or at least not generating revenue for the record companies). What's less clear is how the new rules will be able to track illegal downloads and filesharing - both a mighty proportion of what people listen to.

It's ironic that the digital revolution has made the emergence of talent far more democratic, yet far more difficult and risky for a band to be signed to a major label. While Lily Allen and Arctic Monkeys have demonstrated the power of networking sites such as MySpace, the less fortunate rely on word-of-mouth to move into the now most reliable areas of their business: live performance, merchandising and publishing.

But the acknowledgment of digital music is not to be feared. Home taping never killed music, that was merely an invention by the record industry to keep us buying their version of the recorded format.

The CD never killed vinyl, it merely created cult groups that are numerous enough to keep the market for 12-inch discs hugely buoyant. Sony's mini-disc should have killed the CD, but it got caught in a legal quagmire with the labels that resulted in fewer and fewer titles getting a full release and consumers becoming impatient with it.

Digital music is going to kill the CD - just like vinyl all but killed the cassette tape - for one simple reason. Very few people really love their CD collections. I mean really love it. Do you know anyone who actually takes the booklet out of its cheap plastic (and usually broken) casing and marvels at the rainbow colours whirling through the bendy plastic and inhales the sweet smell of glue? Is anyone going to bemoan the inferior sound quality of compressed MP3 files? Does it really sound any worse than on CD? The only features missing from the current format are physical album artwork and lyric sheets but these are already being addressed with new, bigger-screen MP3 payers and iPods.

Upon its disappearance, there will be precious little nostalgia for the compact disc. When Philips first marketed American James T Russell's invention in the early 1980s, it was held up on the now-defunct BBC science show indestructible. The presenters threw CDs on the ground and stamped on them, saying they would preserve music for time immemorial. Of course, that was hogwash. About 5% of my CDs have these queer black lines running through them that are permanent; scratches that can never be fixed by placing a two-pence coin on top of the stylus to ride out the troublesome grooves. What Tomorrow's World was really saying was: this is what will happen to the CD in less than 30 years.

Smash, bang, invisible.

FILL YOUR IPOD: THE BEST SONGS YOU MAY HAVE MISSED

Radiohead - 'Talk Show Host' The best Radiohead track not on one of their albums featured on the soundtrack to the movie 'Romeo + Juliet' - alongside Mundy.

U2 - 'The Lady With The Spinning Head' A b-side to the single 'One' is an expansion of 'The Fly' and, as it turns out, a much better song.

Beck - 'MTV Makes Me Want To Smoke Crack' A b-side to the slacker anthem 'Loser'.

MTV then made Mr Hansen rich enough to buy a lifetime's supply of the drug, not that he was interested.

The Smiths - 'Jeane' A b-side to 'This Charming Man' which was left off the many Smiths compilations, 'Jeane' has also been covered by Billy Bragg and Sandi Shaw.

Nirvana - 'Even In His Youth' The flip side to breakthrough single 'Smells Like Teen Spirit' sees Cobain at his baby-angst best.

Ray Lamontagne - 'Crazy' Gnarls Barkley's smash hit gets the grizzly-bear treatment on the 'How Come' single and completely transforms it.

David Wilcox - 'Chet Baker's Unsung Swan Song' Featured on the first volume of KCRW's Rare On Air sessions.

Scissor Sisters - 'Take Me Out' B-side to 'Mary' is a live favourite, it swaps Franz Ferdinand's choppy guitars for camp piano. Amazingly, it works.