Digital sales of music represented 10% of the total worldwide music market in 2007, up from 6% in 2006, reports In-Stat. By 2012, digital music sales will represent an impressive 40% of all music purchased worldwide, the high-tech market research firm says. Factors contributing to this growth include the global expansion of broadband, continued demand for single-track downloads, and expanding music catalogues. Another key driver is the potential for market growth in full-track downloads to mobile handsets in markets other than Japan, which currently is the primary market for this type of digital music format.
“Digital piracy continues to represent the primary challenge to online music service providers,” says Stephanie Ethier, In-Stat analyst, in the press release. “Other obstacles still include the lack of interoperability between services and devices due to differing digital rights management (DRM) technologies, and weak consumer demand for subscription-based services. Another potential market inhibitor is the fact that content owners, cellular service providers and handset manufacturers are increasing the amount of marketing and promotion for mobile music.”
Recent research by In-Stat found the following:
• Sales for online digital music reached $3.05 billion in 2007, up 48% from 2006.
• Revenue for worldwide full track mobile downloads will reach approximately $4.2 billion by 2012.
• The majority of respondents who accessed online video (72.3%) in 2007 did not pay for the video they saw from the Internet.
Recent In-Stat research, Revenue Opportunities Abound Worldwide in Online and Mobile Music Distribution (#IN0804027CM), covers the worldwide market for online and mobile music distribution. It provides analysis of the current online and mobile music marketplaces, emerging opportunities, and results from an In-Stat consumer survey. It includes forecasts for digital distribution sales by region, physical media bought online, and total music sales through 2012.
More info about In-Stat can be found at instat.com
Anyone wanna bet on how many crap wanabe music stores will spring up in the next year only to be beat down by iTunes?
“only to be beat down by iTunes” suggests iTMS will actually have to DO something to crush them. it need only continue to exist to continue to crash the majority of mindless copycat wannabes.
Digital piracy doesn’t represent a challenge to the online music service providers. It is a challenge to the content owners. The service providers (such as iTunes) are in fact the solution to this problem. Make it easy to buy and they won’t steal. It’s that simple and that’s why iTunes is working (and others are failing).
that figure is way off…it will be more like 60-65%
I think they are being a bit conservative in their estimates as they see the big labels maintaining their control of the market. As the big music labels will sink into a pit of their own digging. Indie Music will replace big label music and we’ll see high quality music and digital tracks without the DRM restrictions and the inoperability issues will go away. Subscription models are dead as they require DRM and propitiating inoperability issues. FLAC or Apple Lossless needs to become the standard Music Track format and Apple needs to take the lead by either adding FLAC support to iPods and iTunes or giving device developers a Free or low cost License to Apple Lossless, the recording artists just need to get together and declare a standard and then make every retailer stick to it.
The Whole MP3 standard needs to die a quick death. The Big Labels just need to sue themselves into bankruptcy or something equally stupid. Maybe the big labels just need to pour big money into a subscription service using points, Where you go to the Music Retailer buy an Artist card for $50.00 with some number of points and then redeem the card for the points and use the points to activate a 2 month subscription to that Artists Recordings. After all if the model is good enough for Microsoft it should be good enough for the labels too. They could even use the MS Plays for Sure DRM or invent their own that only works on a player you have to buy from the labels. After spending hundreds of billions of pounds they might get a few hundred subscribers. Crap they might even do better then the Zune and Zune Market Place.
@Demon, I was in the campus computer store yesterday and noted Zip cartridges still in stock. I asked the cashier which sold more — the Zips or the Zunes? “Well, nobody buys Zip carts anymore, but they’re still selling better than the Zunes.”
@ Metryq
Of course they do. 5.25″ Floppy disks sell better then Zunes too.
Brussels Sprouts in a school cafeteria sell better then the Zune.
How long until they stop pressing music CD-ROMs and they become collectors items? Then old people can moan about how much better they were than downloadable music, just like the ’33 1/3″ record’ industry today.
Aren’t we all going to be dead from global warming by then?
@Metryq
@Demon
ROTFL
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The difference between Zip cartridges and Zunes is that sales of Zip carts support formerly popular legacy hardware that is still in use, whereas Zunes are unpopular hardware that will never have legacy use.
@HolyMackerel
It is unfortunate that you don’t have enough of an appreciation of music to know how truly ignorant your statement is. You sound like a Windows sufferer who is happy with “good enough”.
But the bad news is that 20% will be Britney Spears, 10% Gangsta Rap and the other 10% will be highlights from American Idol Season 11.
Paula Abdul: Can you believe we made it to 11 seasons?
Simon Cowell: I can’t believe I’m talking to a bloated, intoxicated head in a jar. Simply revolting.