Mobile To Near 30% of Music Retail by 2011
Posted by geoffwhiting on December 8, 2007
Mobile music is rising steadily these days. Currently it counts for around 13% of worldwide recorded music retail sales, and it is expected to shoot up to almost 30% by 2011 according to a new industry report by Understanding & Solutions. This could amount to as much as $11 billion, which should help to offset a decline in packaged music sales.
“Alongside online, mobile music is essential to the future of the music industry,” said Understanding & Solutions consultant David Sidebottom. “Japan, closely followed by the USA, has the most efficient mobile music landscape: both countries have a concentrated operator base and a large pool of potential subscribers, providing economies of scale for the music companies.”
According to Sidebottom, “In the fragmented European market, some operators have become less aggressive, as they can’t make money directly from selling full track downloads, but this will pave the way for ‘off-portal’ and third-party service providers.”
Nearly all new handsets come with a music function built-in, and recent improvements from manufacturers and operators have improved the experience and ease with which users can search for and purchase mobile music.
When it comes to emerging markets, it is the hope that mobile downloads will be able to control markets where piracy overwhelms packaged sales. Sidebottom said that both China and India are showing “large revenue gains” driven by subscription growths and “music-related personalized mobile products.”
The market might not be as big as some hope, though. According to the Digital Media in Asia Project at Harvard Law School’s Berkman Center for Internet & Society, “the price Chinese consumers are willing to pay for per-song downloads is something far lower than the 99 cents” most sites charge. The project says the small consumer base and the rampant piracy threaten “the future of any for-profit online (or mobile phone-based) music retail business model.”
