Half Of All Music Sold Will Be Digital In Three Years

Feb 19th, 2008 | By | Category: Digital Music, iPods & Portable Media Players

Good news for Apple: half of all music sold in the US will be digital in 2011.

Sales of digitally downloaded music will surpass physical CD sales in 2012, according to a new report by Forrester Research. Digital music sales will grow at a compound annual growth rate of 23 percent over the next five years, reaching $4.8 billion in revenue by 2012, but will fail to make up for the continuing steady decline in CD sales. In 2012, CD sales will be reduced to just $3.8 billion.

Among the drivers of Forresters forecast for music sales:

  • MP3 player adoption. The average MP3 player is only 57 percent full, suggesting that the devices are underutilized, while more of the devices are being bought by households with more than one MP3 player. Moving forward, a majority of MP3 players will be sold to households that already have one.
  • DRM-free music. With the four big music labels now committed to eliminating digital rights management (DRM), DRM-free music will extend beyond pioneer Amazon.com to Apple iTunes and the other major online music sites.
  • Social networks. DRM-free music enables every profile page on MySpace.com or Facebook to immediately become a music store where friends sell friends their favorite tracks.

“The industry has to redefine what its product is,” according to Forrester’s James McQuivey. “New forms of revenue will come from unexpected sources. For example, the industry has failed to capitalize on the growing popularity of video games such as Guitar Hero and Rock Band.”

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  2. […] Half Of All Music Sold Will Be Digital In Three Years Good news for Apple: half of all music sold in the US will be digital in 2011. Sales of digitally downloaded music will surpass physical CD sales in 2012, according to a new report by Forrester Research. Digital music sales will grow at a compound annual growth rate of 23 percent over the next five … […]

  3. […] Half Of All Music Sold Will Be Digital In Three Years Good news for Apple: half of all music sold in the US will be digital in 2011. Sales of digitally downloaded music will surpass physical CD sales in 2012, according to a new report by Forrester Research. Digital music sales will grow at a compound annual growth rate of 23 percent over the next five … […]

  4. […] Half Of All Music Sold Will Be Digital In Three Years Good news for Apple: half of all music sold in the US will be digital in 2011. Sales of digitally downloaded music will surpass physical CD sales in 2012, according to a new report by Forrester Research. Digital music sales will grow at a compound annual growth rate of 23 percent over the next five … […]

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