How a Sacramento drugstore turned into a billion-dollar chain
Russ Solomon started selling used jukebox records at 16, out of his father's drugstore in Sacramento, California. The shop was called Tower, after the theater next door, and the name stayed on everything he built after it.
Solomon opened the first Tower Records store in Sacramento in 1960. The idea was close to radical for the time: every genre under one roof, deep catalog on the shelves instead of only the hits, and hours late enough that working musicians could shop after a gig.
It scaled further than anyone expected. At its peak the company ran nearly 200 stores in more than a dozen countries and took in more than $1 billion a year, according to the Washington Post's 2018 account of Solomon's career. The stores in Tokyo, London and on the Sunset Strip in Los Angeles became destinations rather than errands.
Record retail was crowded in those years. Sam Goody had the malls and Virgin Megastore had the tourist traffic, but neither of them matched Tower Records on selection or on opening hours.
Why Tower Records collapsed in 2006
Two things went wrong at once. Compact discs, which carried the chain's margins, stopped being the only way to own music, and discount chains went after the discs people still bought.
The Washington Post's obituary of Solomon named both causes, describing a company "felled by the rise of digital downloads and growing competition from discount chains." File sharing finished what the discounters started, and Napster taught a generation of buyers that an album did not have to cost anything at all.
The finances gave way first. Tower Records filed for bankruptcy in 2004 and, in the Washington Post's phrasing, after "some financial maneuverings by outsiders" it was pushed into bankruptcy a second time in 2006 and liquidated.
By August 2006, when the company filed for Chapter 11 protection for the second time, the American business was down to 89 stores in 20 states and owed creditors about $200 million. Those are the numbers that went into court that fall, and they are the reason nobody wanted to run the business as a going concern.
The 30-hour auction that ended the American stores
The end came in bankruptcy court rather than a boardroom. Tower Records was auctioned in October 2006, and the winning bidder wanted the inventory rather than the company.
Great American Group, a liquidation firm, won with a bid of $134.3 million after almost 30 hours of bidding that attorneys in the room called "robust" and "vigorous," according to the Associated Press report carried by the Deseret News. A federal bankruptcy judge approved the sale that Friday, and the going-out-of-business signs went up.
The margin was $500,000. Trans World Entertainment, which ran record stores of its own and wanted to keep some Tower Records locations trading, lost by half a million dollars on a company carrying about $200 million of debt. A slightly higher bid from Trans World and some of the stores might have stayed open under new ownership.
Instead the 89 stores emptied through the fall while shoppers picked over the racks at closeout prices. The American chain was 46 years old when it stopped trading.
Who owns Tower Records today?
The name and the stores ended up in different hands, which is why the answer has two parts.
The brand was sold separately from the inventory, five months after the stores closed. Caiman Inc., an internet retailer, bought Tower.com and the Tower Records trademark for about $4.2 million at a bankruptcy auction on March 16, 2007, outbidding Amazon and four other companies, according to the Associated Press report carried by Playbill. Who has held the brand in the years since has never been laid out as clearly in public, and the online store trading in 2026 is run by a management team under chief executive Danny Zeijdel.
The stores belong to a different company altogether. Tower Records Japan split from the American parent in the early 2000s and is majority owned by NTT Docomo, the Japanese mobile carrier, as Marketplace reported in 2022. It was never part of the American bankruptcy and was never anyone's to liquidate.
So in 2026 there is no American Tower Records chain for anyone to own. There is a website that ships records, and there is a Japanese retailer that uses the name under its own ownership.
What the brand sells online in 2026
Tower Records came back in a much smaller shape. On November 13, 2020 the brand relaunched as an online store selling vinyl, compact discs, cassettes and merchandise, with the Pulse! magazine revived alongside it. Rolling Stone reported the relaunch that month, including the company's stated plan to open physical locations later. Those locations have not appeared, and there is still no Tower Records store to walk into anywhere in the United States.
Danny Zeijdel told Rolling Stone in 2020 that the return "has been met with tremendous success," and described customers photographing their deliveries and posting them on Instagram, which is a fair description of what the brand now sells: a shipping box with a logo people recognize. The browsing, the listening stations and the clerks with opinions, which is what people actually remember, is the part that did not come back.
Where to find one today: original Tower Records store bags, staff shirts and back issues of Pulse! circulate steadily in the vintage market, and what they cost depends on condition and rarity rather than any set rate. The Tower Records listings on Etsy are a reasonable place to start looking.
Why the Japanese stores outlived the American ones
Tower Records stores are still open every day, just not in the country where the chain started. Tower Records Japan runs stores across Japan, including the Shibuya flagship in Tokyo, and it kept trading straight through the year the American chain was liquidated.
Marketplace reported in 2022 on why those stores kept working. Japanese listeners went on buying physical discs long after American listeners stopped, compact discs stayed the dominant format there, and the streaming services that hollowed out American music retail arrived in Japan late.
The gap is easy to underestimate. In the United States the question about Tower Records is which year it closed. In Japan it is which branch to visit, and the chain is treated as a normal way to buy music rather than a memory of one.
That split is also the answer for anyone who has seen a photograph of a Tower Records sign taken last week in Tokyo. The stores in Japan were never sold to Great American Group, were never part of the American bankruptcy, and never had to come back, because they never went away.
Frequently Asked Questions
Is Tower Records still in business?
Tower Records is still in business as an online store, which relaunched on November 13, 2020 and sells vinyl, compact discs, cassettes and merchandise. The American retail chain is gone: its 89 remaining stores were liquidated after the October 2006 bankruptcy auction, and no Tower Records store operates in the United States in 2026. Tower Records Japan, a separate company, still runs stores in Japan.
Who owns Tower Records now?
Tower Records has two owners rather than one. Caiman Inc. bought Tower.com and the Tower Records trademark for about $4.2 million at a bankruptcy auction in March 2007, and the online store trading in 2026 is run by a management team under chief executive Danny Zeijdel. Tower Records Japan, which operates the stores still open in Japan, is majority owned by the mobile carrier NTT Docomo and was never part of the 2006 American bankruptcy.
Why did Tower Records go out of business?
Tower Records went out of business because compact disc sales fell away while its debts did not. The Washington Post's 2018 obituary of founder Russ Solomon said the company was felled by digital downloads and competition from discount chains. Tower Records filed for bankruptcy in 2004, filed again in August 2006 with 89 stores in 20 states and about $200 million owed to creditors, and was sold to a liquidation firm at auction that October.