Worldwide digital music sales rose enough in the first half of 2005 to offset the decline in physical music sales which is damaging the music industry. Despite this, however, new figures from market research firm Synovate show that 70% of consumers in Asia download music without paying.
According to Synovate, ways in which music providers can encourage consumers to pay for downloads include offering easier searching, greater music choice and lower prices.
Meanwhile, the market research firm also found that portable MP3 Players are used by over one-third of consumers in Hong Kong, and 28% of consumers in China and South Korea.
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, with Nielsen//NetRatings showing that 61.9 million people visited online music sites in April 2005.
In its Online Music: Downloads, Streaming, Radio, Mobile report, US analyst eMarketer asserts that the growing popularity of broadband has been an important driver for the online music sector (see Digital World Transforming Music Industry).
Commenting on the research, Ben Macklin, senior analyst at eMarketer and author of the report said: “”By the end of 2005 there will be over 41 million broadband households in the US and an almost equal number of digital audio players in the market. iTunes and iPods go hand in hand, and with the recent phenomenon of podcasting and the growing popularity of satellite radio, on-demand audio entertainment has moved to the next level.”
Music downloads are also becoming increasing popular on mobile phones, with a recent study from NPD Group showing that 27% of users play games on their handsets (see Mobile Game Downloading On The Rise).
However, like other forms of music downloading, 36% of games downloaded in the second quarter of 2005 were acquired for free, with revenue generating purchases making up 64%, according to measurement body Telephia.
Despite these pitfalls, Informa Telecoms and Media estimates total global revenues from games on mobile phones to reach $11.2 billion by 2010, increasing by a massive $8.6 billion from $2.6 billion this year (see Global Mobile Games Revenues To Hit $11.2 Billion By 2010).
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