Forrester Report: Digital Growth Rates Leveling Off

Music Listening Online Leveling Off?

Americans love buying digital music, writes MEDIAPOST.COM, "but growth rates related to other digital music activities are leveling off, according to new research from FORRESTER. Despite the best marketing efforts of companies like MYSPACE and PANDORA, mainstream Americans still haven't taken to streaming music services, according to a survey of some 4,600 Americans, along with 13,000 Europeans."

The FORRESTER report says only 18% of U.S. adults -- approximately 40 million consumers -- listen to free streaming music online on a regular basis. That's a percentage that has remained fairly constant. Meanwhile, only 3% of U.S. consumers have downloaded a music app for their phone.

"Bottom line," FORRESTER concludes: "Digital music revenue has not yet made up for the decline in CD sales."

FORRESTER RESEARCH music analyst MARK MULLIGAN called for a radical overhaul of the music industry, beginning with a "product manifesto of consumer rights."

"Future music products will need to adopt a platform-agnostic worldview that encompasses powerful and social interactivity to empower consumers to create their own unique experiences," MULLIGAN wrote. "In the post-media-meltdown world, product innovation will trump programming and marketing as media companies' most valuable asset -- and the music industry is no exception."

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