Low price of physical cd is a sign of long shelf life, which is a sign of low demand. To free the space for something with a faster stock rotation at higher price, you lower the price of the low demand stuff to raise it's demand momentarily.
Oversimplified example:
100 units of Product A at 10€ profit with demand of 5 units per month
100 units of Product B at 10€ profit with demand of 25 units per month
The wholesale company only sells products in packages of 100 units.
Both take equal amount of physical space in the storage, and your storage only holds 200 units. You have 0 available storage units.
After 4 months, you have sold 20 units of Product A, and 100 units of Product B. You have 120 available storage units.
Since Product B has a lot of demand and you even have on going orders for it, you must buy more Product B.
But there is even Product C, which is the new hot shit of next month with demand of 50 units per month.
But you can't order Product C, because you don't have the 100 free storage units.
To get rid of the 80 remaining units of Product A with low demand to make room for Products B and C with high demand, you either throw them away for 100% loss, or you decrease the price of Product A (and possibly never order it again) to increase it's demand and your profit goes from to anywhere between 0-9€, or possibly even to negative.
With non-physical digital products there is no need to lower the prices, because excluding the 1's and 0's on the hard drive, they don't take any physical space. Since an MP3 album takes about 50-100MB each, you can fit about 20 000 to 40 000 MP3 albums on a 2 terabyte hard drive (2 terabytes / 100megabytes = 2 000 000 mb / 100 mb = 20 000), there is not big of a problem to have them there.
