With traditional music sales of CDs plummeting, music labels are looking for
alternate revenue streams. While record labels see higher profit margins from
physical media sales like CDs, the huge volume of sales that digital downloads
can deliver may offset the lower profit margins.
According to a new
study from research firm eMarketer, traditional music sales will continue
to decline, but online and mobile music sales will grow rapidly. As faster
mobile networks are introduced around the country, digital music downloads will
become faster and easier for users to purchase.
The report predicts that by 2011, mobile music sales will be a $7.3 billion
business. In 2007, mobile music sales amounted to $1.7 billion and by the end
of the year sales are predicted to total about $3 billion. In 2009 the number
is expected to hit $4.8 billion and by 2010 the mobile music industry will be
worth $6.2 billion.
Despite the huge growth to be seen in the mobile music market, Information Week reports that the music
industry expects to see a decline in music sales of about $5 billion. The
report includes master recording ring tones, full-track audio downloads,
ringback tones, music video downloads and streaming services in the predicted
market worth.
There are many mobile services looking to cash in on the massive growth
expected for mobile music downloads. Apple’s iTunes music download service is
currently the top digital music retailer and Apple has said it plans
to enter the mobile music market with ring tones and more.
