China is expected to become a major market for legal online music downloading, with new research from In-Stat forecasting the region to enjoy an estimated annual revenue of US $222 million by 2008.
According to the high-tech market research firm, this strong growth is fuelled by the launch of several third-party online music stores, and some unauthorised services legitimising their offerings.
Commenting on the findings, Anty Zheng, In-Stat analyst said: “The end of 2007 will be the turning point for China’s legitimate digital music market.”
Explaining the reasons behind the expected growth, Zheng continued: “By then, several mega online music stores will have opened; the user-base of portable music devices will have surpassed 100 million; a major crackdown on music piracy will have been in effect for several years; third-generation (3G) mobile communication system access will be rolled out; and consumers will be adequately educated about legitimate digital music.”
Asia is renowned for having problems with illegal music downloading, with research from market research firm Synovate showing that 70% of consumers in Asia download music without paying (see Majority Of Music Downloads In Asia Free). Despite this, Synovate claims that worldwide digital music sales rose enough in the first half of 2005 to offset the decline in physical music sales.
The increasing adoption of broadband, combined with the digitisation of music and the emergence of portable digital music players, is fundamentally changing the music sector.
The important role of broadband in the digital music market is confirmed by eMarketers Online Music: Downloads, Streaming, Radio, Mobile report which claims that by the end of 2005 there will be over 41 million broadband households in the US and almost an equal number of digital audio players (see Digital World Transforming Music Industry).
According to research published last year from the International Federation of the Phonographic Industry (IFPI), retail value of the digital music market accounts for 6% of total retail sales around the world (see Digital Music Sales Reach $790 Million).
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