48% of US teens did not purchase a single CD in 2007, compared to 38% in 2006.According to The NPD Group, a market research firm in Port Washington, NY, the amount of music that US consumers acquired last year increased by 6%. However, despite a sharp increase in legal digital download revenues it was not enough to offset a declines in physical CD sales, which resulted in a net 10% decline in music spending (from $44 to $40 per capita among Internet users). As a result the overall portion of music consumption that consumers actually paid for fell to 42% in 2007 from 48% in 2006 NPD estimates that one million consumers dropped out of the CD buyer market in 2007, a flight led by younger consumers. In fact, some 48% of U.S. teens did not purchase a single CD in 2007, compared to 38% in 2006. The percent of the Internet population in the US who used illegal P2P and file-sharing services reached a plateau of around 19% last year. But, the number of files each user downloaded increased, and P2P music sharing continued to grow aggressively among teens. According to the study legal music downloads now account for 10% of all music acquired in the US, and is why Apple’s iTunes is amazingly now the second-largest music retailer in the US after Wal-Mart! Twenty-nine million consumers acquired digital music legally, via pay-to-download sites last year, which is an increase of 5 million over the previous year. Sales growth was largely driven by consumers age 36 to 50 – a segment that was aggressively acquiring digital music-players in 2007. “The continued growth in legal download sites is encouraging, yet the industry struggles to improve the value of each digital customer,” said Russ Crupnick, entertainment industry analyst for The NPD Group. “With so many baby boomers and gen-Xers entering the market, there are certainly opportunities to sell more digital albums, promote older catalog titles, or create bundles that will raise revenues. In the near term that’s going to be the best means available to narrow the gap on dwindling CD revenues.” I think the fact that the percentage of teens that did not buy a physical CD last year increased by 12% should remind the music industry that music is going digital whether they like it or not. Teens have so many entertainment choices and options vying for a finite period of time that music has become a commodity like any other. If it's not cheap, portable, and on-demand then they will simply choose something else that is. This is surely why P2P and file-sharing services have increased among this age group, for it allows them to get their favorite music for FREE whenever they want, and also to take it wherever they wish to go. |
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No, I'm not getting an I-Pod, which I feel is just as big a ripoff as CD's were ( a new model every month, and you feel you need to "upgrade"; otherwise, you're not high tech enough.) The answer: flash drives. You can put just as many songs on them as your I-Pod and they're way cheaper (and will get even cheaper as time goes on).
More and more car radios are coming out with USB ports in them; computers are getting smaller and smaller. Let I-Pods go out with the C.D.'s. (Sorry to change the topic a bit, but they both have to do with getting ripped off, and teens--as we all know--don't have large amounts of cash lying around. And, newsflash: neither do we Baby Boomers!)
Teens like trends. One of the newer trends is owning an iPod. You cant put a CD into an iPod so buying CDs is going to be declining. And how many teens do you know that are allowed to get unlimited usage on their parents computer for doing their own needs.
The RIAA should just roll over and die already.