Almost a year and a half ago, Apple’s iTunes store took over the top spot in U.S. music retailing from Wal-mart, and the event was hailed as a bit of a milestone in the development of the digital music business. But iTunes’ growth hasn’t really stopped there: according to new sales figures from the NPD Group, Apple’s iTunes store now accounts for 25 percent of the U.S. music market. And while the audio CD remains the most popular format for music sales in the United States, digital sales are growing at a pace that should have them nearly equal to CD sales by the end of 2010.
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Zune Opens to Number Two Spot
New data released today by the NPD Group found that during its product launch, Microsoft’s Zune handheld media player debut at the number two sport among portable media players, based on sales. According to the stats, the Zune grabbed 9 percent of sales for the week ending November 18; to that point, the Zune would have been on the market four days: it’s official launch was November 14, 2006.
NPD Asks What Users Want In Next-Gen Games
According to the NPD Group, a long-standing consumer research firm, the most important features consumers are looking for in next-generation video game consoles—like the Xbox 360, PlayStation 3, and Nintendo Wii—is great game content, followed by backward compatibility with favorite games.
“Price is definitely a factor, but not as much as is content,” said NPD analyst Anita Frazier in a release. “I’ve long been a believer that it isn’t any particular technical capability that will win this next console battle. The story continues to be content.”
2005 U.S. Video Game Sales Topped $10.5 Bln
The NPD Group says that retail sales for video game hardware, titles, and accessories in the United States topped $10.5 billion dollars during 2005, a record year despite weak sales of console systems. The figures represent a six percent increase over the $9.9 billion in sales racked up in 2004, and a $200 increase over the previous record year, 2002.
Multimedia Features Attract Mobile Buyers
The report, the first in a series of annual studies to measure ownership and attitudes underlying the growth of the mobile phone market, is intended to aid manufacturers, marketers and sellers of cellular phones in their planning and marketing to meet the needs of consumers.
According to the report, music, games, photos, e-mail and Internet have all found their way onto cell phones, and as more consumers look for ways to integrate multimedia technology into their everyday lives, it is no surprise that nearly 74 percent of Americans now use a cell phone on a daily basis. However, lest manufacturers think handset usage is ubiquitous, 26 percent of Americans still do not use a handset today, indicating there is still a significant market for first-time buyers.
Average Selling Price of Tech Products Down
August sales showed some sequential price declines with prices down 2 percent from July, the sharpest decline since May. Compared to the same period last year, August 2004 prices were down 16 percent. The overall price level fell below $12,000 for the first time, with the total price for the Price Watch basket of goods hitting $11,979.
“The high sequential price decline shows that August is an important selling month with deals and value being key selling points to drive merchandise sales for the back-to-school season,” said Stephen Baker, director of industry analysis for The NPD Group. “However, the fact that overall price declines in August were moderate compared to other months this year seems to indicate that back-to-school activities do not set long-term trends in pricing and that the month is more directed toward driving volume.”
Home Netoworking Due For a Change
The growing trend of home networking–and the reasons why users are assembling such networks–puts PC makers such as Dell and Hewlett-Packard in the catbird’s seat, according to a survey releasedMonday by the NPD Group. But as home networking expands from handling basic PC-centric chores such as file sharing, those vendors may not be the ones that end up with the bulk of the market, NPD’sstudy concluded.
The survey, which was conducted in October and November, ranked Dell and HP rank as the top two preferred suppliers of home networking gear by those who have both already installed a network and those who plan to.
Sony ushers in 8X dual format DVD writers
Its latest duo of high-speed burners underlines Sony’s DVD drive ingenuity and market leadership. In fact, The NPD Group ranked Sony number one (based on dollar market share) for DVD burner sales in the combined U.S. retail and reseller markets during August 2003.
Sony’s award-winning Dual RW drives, which started shipping a year ago this month, were the PC industry’s first combination drives to support the DVD+RW, DVD+R, DVD-RW and DVD-R formats. Speed takes center stage with Sony’s fourth-generation Dual RW drives – the internal DRU-530A and the external DRX-530UL – which are capable of recording to compatible DVD+R discs at speeds of up to 8X, enabling users to burn an entire 8X DVD+R disc in about ten minutes.
Palm Zire sales pass 1 million mark
“By focusing on what matters most to the mainstream, we delivered the first consumer handheld to break the sub-$100 price point and reached a previously untapped market,” said Todd Bradley, president and chief executive officer, Palm Solutions Group. “And the mainstream responded — first-time handheld purchasers, including students, families and individuals, have embraced the Zire handheld as an affordable way to organize their busy lives.”
In recent customer satisfaction surveys (April 2003), the Zire handheld rated higher than all or most other brands in overall satisfaction, likelihood to recommend, likelihood to purchase a Palm handheld again, and value for the price.
Industry divided over DVDs
But the technology comes with another, less appealing feature: a confusing format war, in which customers have to choose between competing, incompatible standards. To add to the confusion, the namesof the two leading formats — DVD+R and DVD-R — are similar.
So far, it’s an even fight. Of the 7.5 million blank DVDs sold last year — compared with 1.6 billion blank CDs — the research firm NPD Group estimated that 50.1 percent were +R or +RW and 47.5 percent were -R or -RW (or “dash”) format.

