Yeah, on top of what Dave said, every major denies this. Billboard thinks this is completely bogus. Every other major industry magazine has either denied it or only reported on it as something that's a "rumor." Only Side-Line reported that. Every other one of the myriad versions of this story is based on the Side-Line story, which is ridiculous, given that the majority of major label profits are still CD sales. It's been discredited several times but it's just one of those 2012 doomsday theories that won't go away.
I mean, people are still makin' cassette tapes. CDs aren't going anywhere for a long time. Especially while WalMart has a chance to sell Poison and Garth Brooks albums to portly southern men. Some people might prefer MP3s and Vinyl and that's cool but you can't listen to Vinyl records in your Prius, and you can't package and promote an MP3. So until all music retail is dead, I think we're going to see CDs around.