iTunes' phenomenal growth continues as
latest industry research performed by the NPD Group officially states
it is now the second largest music retailer in the U.S. The report
prepared by the research firm analyzed 2007 music sales figures in
the U.S., including the sales of both physical CDs and digital music.
iTunes falls short in music sales only to Wal-Mart.
sales figures, which holds every 12 songs downloaded as the
equivalent of an entire CD, is not just a win for Apple, but also
proves that the entire paid digital music download industry is
rapidly growing. According to NPD, legal digital downloads "sharply"
increased in 2007. Interestingly, there was also a 10 percent decline
in overall music spending -- most likely because online digital music
retailers give consumers the ability to purchase single songs in
place of entire albums.
NPD went on to estimate that one
million consumers moved away from buying music CDs in 2007. The firm
believes that younger consumers led the way in the CD walkout. It
estimates that 48% of teens in the U.S. decided to not purchase even
a single CD in 2007, up from 38% in 2006.
P2P usage among
teens to share music also grew last year, with the number of music
files downloaded via P2P rapidly increasing among teens.
the heightened P2P activity, which is estimated to be used in 19% of
American households, NDP states that 10% of all music purchased in
2007 was legally downloaded via sites such as iTunes or Amazon. The
number of consumers who legally downloaded music grew to 29 million
consumers, whereas previous sales figures placed that number at 24
million. Sales growth can largely be attributed to consumers in the
36 to 50 age group, which also happened to purchase a large number of
digital music players in the same year.
Apple said today that
there are now over 50 million iTunes store customers. In addition,
Apple states that iTunes sold over four billion songs, and that 20
million songs were sold on Christmas Day 2007.
sales figures boosted iTunes past Best Buy, which previously held
second place in retailer rankings. Apple similarly overtook retailer
Amazon.com for third place last June.