Yes, forecasts have generally proven to be way off beam when it comes to digital music but at least Strategic Analytics (SA) is basing its findings on the growth in broadband, which frankly is the predominant force behind the growth in digital music consumption – yes, alongside the popularity of the iPod and its ilk. Anyhow, SA is predicting digital music accounting for 16% of all music sold by 2010 or $4.5 billion, with $1.1 billion for 2005 being the starting point. Downloads will continue to spearhead the growth but within five years 60% of online music sales will be through subscriptions.

“Telcos, cable operators and other broadband service providers will encourage adoption of subscription-based services, which produce steadier revenue streams and are more likely to deter customer churn,” notes Martin Olausson, Senior Analyst for Strategy Analytics’ Broadband Media and Communications service. “Subscription-based services will also be better positioned to maintain price points over time by adding portability and other advanced features.”

With the total number of music subscribers currently somewhere around the 1-2 million mark and there being about 80 million active accounts on iTunes, that’s one hell of a turnaround but stranger things have happened!

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