Paid Music Downloads Continue to Grow

By Ian Bell April 13, 2005

The worldwide online music market is expected to grow 134% this year, reaching $1 billion for the first time. With increased competition between sites this year, differentiation will be a key strategy. Sites are building larger catalogs and working with labels to offer new types of digital content, such as live concerts and re-mixes. In addition, branding and customer loyalty will be a primary focus.

A recent report by In-Stat included a consumer survey and found the following:

— More than half of the survey respondents who have downloaded music from the Internet admitted to not paying for it.

— The average amount spent in the past year for online music was $25.

— 35% of the respondents are owners of an MP3 player, with 70% saying it was their first one.

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