2005 brings in new records for online music purchases

By Justin Mann on January 9, 2006, 4:59 PM
2005 apparently brought new heights for the music downloading business, with the final week of December bringing in nearly 20 million separate songs sold, more than twice the previous record of 9.5 million. For all of 2005, the estimate is 352 million, which is well over twice as many from 2004. A lot of this success can be attributed to the iPod and other mp3 players, which have been given great improvements the past year. Digital music sales are quickly approaching CD sales, and may even surpass them in the next year or two. So much for the music industry claiming that legal downloadable music will never catch on. This isn't making them happy, though.

”While more legitimate downloads should be good news for the music industry, analysts say the trend may not bode well for the record labels. Because single songs sell well in digital form, sales of entire records are likely to plummet over time. And music labels have already let it be known that they believe the 99-cent per song price most download sites, including the iTunes Music Store, offer, is too low.”
Regardless, the people have spoken, and online content is where most everyone, from a consumer and service provider standpoint, wants to be.

User Comments: 9

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asphix said:
And its good to know Steve Jobs has the spine to stand his ground and say no to the record labels! I'm happy where the price point is and it doesnt need any tinkering. The record labels aren't struggling to survive and I dont see how 1 song for 99 cents is too much.For $15.00 you get a 1.5-3 hour movie. For $.99 you get a 3-6 minute song. Given they're different types of media, I think the pricing sounds pretty good. You listen to songs repeatedly more than you view movies multiple times therefore making the price comparison make sense. If the price for songs went any higher it would just make those really attactive looking numbers look odd and out of place when in comparison.[/
PUTALE said:
i think it's all due to ipod. The sucess of ipod really make digital music an accepted format of music, and it brings mp3 into the "forbidden" world:).
fury said:
Every other industry embraces their customers and goes along with the trends that the customers create; why won't the record industry? The money that is charged for CD albums is disproportional to the quality of the songs contained in it. Most albums have one to three decent hits (each of which, incidentally, they also release alone as a "single" ironically for about the same price as an online download plus the cost of the materials) and then 10-15 filler tracks that the artist spent maybe an hour on before it got set in stone. If all of the tracks on each album were even half as decent as the hits on the album that the artist (or the recording industry) wants to push, then you can bet there never would have been complaints in the first place about album prices, and the music download trend would not have grown so dramatically so quickly.Just my 2 cents...
exscind said:
I don't see how and why the record industry is complaining 99 cents per song is too low. They were the ones who complained about music piracy and people downloading music for free. At least now they'll earn 99 cents instead of a big goose egg. 99 cents may not seem much, but multiply it by 20 million and it's quite a bit.
Kaleid said:
What I want: Uncompressed audio.
otmakus said:
Looks like noone here considers RIAA suing left and right as a major factor for the increasing trend of legal music purchases.As for the complain of the download price by the bigwigs, it's only natural. They used to get a lot more than just 99 cents/song. If a robber used to get 100 grands in a robbery, he too, would complain if he gets 10 grands in a robbery.
iluvnug said:
99 cents is actually a great price. Perhaps this will encourage artists to come out with quality tracks and more of them.
Cartz said:
I think you're all forgetting that the entire 99 cents doesn't go to the label anymore, iTunes (or similar services) get a portion of that too. The label gets, I would guess, 75 cents... tops.I can also only assume that the majority of the songs being downloaded are the hits, which someone stated previously came in at about 3/record. So if a label is only making 2 or 3 dollars tops, on a product that they used to make 10-15 on, its no wonder that they're a little upset.If you think about the costs associated with production of a song, the studio time, the re-mastering, the producers and musicians salaries, and look at how many songs they'd have to sell just to break even, and you'd realize why they're upset, I think they're totally justified.They shouldn't be suing normal people, but no other industry in the history of the world has undergone the type of looting that the music industry is currently enduring. Piracy and new distribution methods are severely undercutting these people's livelyhoods, yet everyone still views them as the bad guys.
mentaljedi said:
Its all the Ipods doing and the fact that Mp3 players have dropped in price significantly yet are still high quality. 2005 was definatly a downloading year!
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