Unlicensed file sharing services will continue to thrive until record labels allow internet users to download music legitimately, according to a new report from The Yankee Group.
Consumers aged 14 and above downloaded 5.16 billion audio files in the US via unlicensed file-sharing services such as KaZaa, Morpheus and LimeWire in 2001. This is set to increase to 7.44 billion files in 2005 but official music services will start to have an impact at this point and unauthorised file downloads are predicted to drop to 3.90 billion by 2007.
“Efforts by the record labels to use the courts to quash music piracy have failed and legitimate online music services have had little impact,” said Michael Goodman, senior analyst for the Yankee Group’s Media & Entertainment Strategies research practice. “The future of music, however, resides on the internet, and its dramatically lower distribution costs.”
Goodman argues that to be popular, files downloaded from legitimate music services will have to be playable on different devices and easy to manipulate. He adds that digital rights management (DRM) issues will have to be overriden as users will always find a way to share music.
Earlier this week, a report by Forrester Research claimed that revenues from digital music in the US would exceed $2 billion by 2007 (see Digital The Way Ahead For Music Business, Says Forrester)
