Compact Disc format rocks on in Europe
LONDON - The compact disc has at least another five years as the most popular music format before online downloads chip away at its dominance, a new study said on Tuesday.
Technology consultancy Jupiter Research said in its annual report that in 2009 European music fans will buy 836 million euros ($1 billion USD) worth of music in the form of digital downloads and subscriptions to internet radio services.
At that level, digital music revenues will account for roughly 8 percent of Europe's estimated 10.2 billion euro music market. The study does not take into account the surprisingly successful market for mobile-phone ring tones.
The piracy-battered music industry is desperate to see industry-backed download services become a hit with consumers to derail the popularity of free file-sharing networks such as Kazaa and eDonkey.
But trying to predict growth in the relatively new digital music sector has proved extremely difficult. Last month, Forrester Research published a much more bullish forecast that the Western European digital music market would be worth 3.5 billion euros – or 30 percent of the overall European market – by 2009. Jupiter disagreed.
"Although Europe's digital music market has finally begun to take off after a sluggish start, it will remain a relatively niche market," said Mark Mulligan, a Jupiter analyst.
Jupiter said the venerable CD – not the download – will remain the best-selling format throughout the remainder of the decade as the installed base of CD players continue to dwarf that of MP3 players and other digital music devices.
"Digital music distribution will be an important alternative revenue channel for the music industry, but it is not about to replace the CD," he added.
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