“Two separate reports offer contrasting opinion on the health of the digital music market,” Jonny Evans reports for Macworld UK.
“Forrester Resarch analyst, Josh Bernoff has revealed figures that claim Apple sells 20 songs through iTunes for each iPod sold. He makes the assumption that this figure — which has remained relatively static historically — represents all legitimate music consumption by iPod users,” Evans reports. “Meanwhile, Akamai has published a global glance at the traffic levels across 40 digital music stores, including iTunes.”
“The Forrester figures aren’t based on actual sales, but on information Bernoff has been able to estimate that is based on credit card records,” Evans reports. “Over the past 12 months, 3.2 per cent of US households with internet access have purchased songs through iTunes, but only about $17 worth, his report claims. He also says the number of iTunes sales has slipped 58 per cent since January 2006.”
Evans reports, “Akamai’s report deals with known levels of activity on music websites. These contrasting results indicate that interest in digital music services continues to grow.”
“Akamai also conducted a survey of online consumers to better understand their digital music habits. Respondents ranged in age from 19 to 68 with a survey base of 200 people, 58 per cent female and 41 per cent male,” Evans reports. “The survey showed that 86 per cent of respondents own a portable music device and 76 per cent spend $1-$5 on music downloads every week. 82 per cent of music lovers prefer a download-to-own service to anything else, and 42 per cent of customers are loyal to one digital music service.”
Full article here.
Related articles:
Akamai Net Usage Index for Digital Music measures real-time global consumption of online music – December 11, 2006
WSJ mistake: ‘digital-music sales have stalled for the first time since Apple launched iTunes Store’ – December 06, 2006
Digital downloads drive world music sales in first half of 2006 – October 13, 2006
Study reports the obvious: most music on iPods not from iTunes Store – September 17, 2006
Apple iTunes Gift Cards help boost growth of digital music in U.S. – April 21, 2006
Hey iTunes Store lemmings, you’re all fools. Microsoft’s magnificent Zune Marketplace only requires points. Zune points.
No money, no credit cards, no trips to Target unless you’re buying a Zune. Leave it to Microsoft to get it right.
I would say the statistics are spot on too. iTunes Store? Puhleeeze. Get ready to see a huge uptick in digital music sales after the holidays when Zune users start downloading from Zune Marketplace.
Welcome to the Social.
While this is primarially FUD, some of it is real. CD’s still sell well, and it is not primarially due to DRM, but to sound quality.
What must change:
1. Apple must move to 256 bit music.
2. Any music previously purchased from the iTunes Music Store can be re-downloaded at 256 bit.
– One would assume Apple has every song ripped into a least 3 or 4 levels of quality. 128 bit, 192 bit, 256 bit and lossless… If not, this was horrifc planning by a marketing team with zero vision or skillset. Let us hope Apple hired the right people and implemented the right methodology regarding music moving forward…
3. Go after the stranded WMA market. Give those who are now abandoned by Redmond who do not want a Zune (as they don’t wish to be Zune’d), to convert their WMA music to AAC or MP3 in iTunes.
– No, this will not convert DRM music, but millions of songs that WMA player purchase folks have is music they have ripped in themselves. Give them the ability to easily move that music into iTunes.
Subscription Model? No, not yet. Not necessary. Just getting high quality music to purchase online will more than shore up any slow-down via iTunes.
Mark Twain said it first: As I keep saying, “There are lies, damn lies, and then there are statistics.”
Hey Darkness,
Bernoff has a history of being wrong on many topics. If you have access to his research at Forr, check his calls out…
Hey Steven,
You have no idea what you are talking about.
1. Why 256? Do most people care? Sure, a chunk of people who post on tech boards say they want higher quality audio, but most people — the vast majority — don’t care. Do you recall when CDs came out and audiophiles said digital was inferior to analog? Guess, what, no one but a few wackos cared. Show me ANY non-anecdotal data to support your view, versus the number of “low quality” songs sold at iTunes, and I might listen…
2. Re-downloads are a resource drain for a seller and are not required. Guess what, you won’t get a free HD DVD at Best Buy if you turn in your DVD. Sure, it would be nice to magically get higher quality downloads, but I’ve had to buy vinvyl, tape, and CDs. Why change now? I could see offering a re-download for a percentage off, but not for free. No reason to do it.
3. iTunes owns the freakin’ market. Rather than go after WMA or Zune DRM folks, how about just expanding markets already served by iTunes stores and adding more. That makes a lot more sense.
Don’t quit your day job. Or better yet, apply for an anlayst job with Bernoff.
Steven, iTunes can already convert non-DRM WMA files into mp3 or aac!
These damn analyst. these guys are really stock manipulators. no reason for AAPL to drop because of stupid freakin FUD articles “research” that totally skew, manipulate and are pure wrong…
disclaimer – I own tons of AAPL stock, luckily bought at $67, patiently awaiting 1Q07
I see Engadget decided to ride with the FUD.
http://www.engadget.com/2006/12/12/itunes-sales-collapsing-blanket-licensing-to-succeed/
Lol, look at the image they used.
I don’t own an iPod and I’ve bought 22 songs this month alone.