Is It The End Of The Music World As We Know It?
January 24, 2011 at 6:21 AM (PT)
As music sales have declined over the past decade, many held out hope that the digital music business would be Holy Grail -- the next technology to infuse cash into record labels. THE NEW YORK TIMES, however, poses the question, "What if digital music sales have peaked?"
The LONDON-based INTERNATIONAL FEDERATION OF THE PHONOGRAPHIC INDUSTRY framed the debate last week, writing that sales of digital music had risen only 6% worldwide in 2010, as the overall music market was down 8 or 9%.
Wrote THE TIMES, "In each of the past two years, the rate of increase in digital revenue has approximately halved. If that trend continues, digital sales could top out at less than $5 billion this year, about a third of the overall music market, but many billions of dollars short of the amount needed to replace long-gone sales of compact discs."
"Music's first digital decade is behind us and what do we have?" asked FORRESTER RESEARCH analyst MARK MULLIGAN. "Not a lot of progress. We are at one of the most worrying stages yet for the industry. As things stand now, digital music has failed."