Cassettes replaced eight-track tapes, CDs replaced cassettes and this year, music downloads and newer streaming services will officially eclipse CD sales, at least, according to one source.
Market researcher Strategy Analytics predicts U.S. digital music sales will grow to $3.4 billion this year, exceeding the $3.8 billion in combined revenue from CDs and vinyl.
Worldwide, digital music sales will surpass physical purchases in 2015, according to the analysts’ latest Global Recorded Music Forecast.
Online streaming revenue will grow, to $1.1 billion, nearly five times the rate of download revenue growth this year, to the tune of $3.9 billion. Streaming revenue growth should see a 40% increase compared to last year and in comparison to 8.5% growth for the same period. “Therefore, streaming services will take over as the leading revenue growth engine for the music industry in 2012, generating an extra $311 million, $8 million more than downloads at $303 million,” according to the company.
Strategy Analytics’ Director of Digital Media Ed Barton says though downloads still account for nearly 80% of online music revenues, the market is maturing and spending is flattening. Streaming music services like Pandora and Spotify will be the key growth drivers over the next five years as use and spending grow rapidly, he predicts.
The spending changes are driven as consumers increasingly value accessibility and availability over actually owning digital music.
The full report is available for purchase for $6,999 here.
