Surprising statistics from Forrester report

A Forrester Research report released earlier this week, "The End of the Music Industry As We Know It," contains some surprising statistics.

Forrester Research published a report on the music industry earlier this week entitled "The End of the Music Industry As We Know It," and it offers some conclusions that shouldn't surprise anybody who's been following the music industry for the last few years: as users have shifted their behavior to computer-based digital music, the recording and technology industries have not made it easy enough to discover, share, and buy new music in new media and formats. Hence, the rise of all-digital sales will be too little, too late, to compensate for the fall in CD sales, and record companies will have to get into new businesses, like so-called "360 deals" in which they take a cut of all proceeds related to an artist--not just record sales, but also touring and merchandise. (Sounds like an even worse deal than artists used to get, but I suppose the devil's in the fine print and the percentages.)

While the report's conclusions weren't surprising, some of the specific market data buried inside were. For example:
Radio rules. A Q3 2007 survey of more than 5,000 U.S. adults with online access showed that 94% of them still listen to the radio, and on average spend 43% of their overall audio-listening time with radio--far ahead of #2, CDs, which occupy only 20% of listeners' time. I'd guess that a lot of this time is spent in the car, and with talk radio rather than music, but those numbers still surprised me. Apparently not everybody likes to program their own playlist. An interesting and related point: among survey members who owned an MP3 player, radio listening time was dramatically lower at only 25% of total, but still comes in ahead of the time they spend listening to their MP3 player, which was only 22%.
PCs beat MP3 players. I thought the main reason you'd want to get your music onto a computer is so you could get it onto another device, like an iPod. But the survey showed that 62% of the subjects listen to music files on a PC, while only 43% of them listen to music on an MP3 player. Even 48% of them listen to Internet radio--again, listeners want to be surprised from time to time.
A quarter of iPod sales are repeat customers. Of the iPod owners in the survey, 25% of them say they'll buy another in the next twelve months. That's phenomenal--I can't think of another consumer electronics product that had such high repeat-purchase figures after only about five years on the market. Walkmen, maybe. DVD players as a group, perhaps, but not one particular brand. This just shows how dominant Apple is in this market.
Zune 1.0 was a non-factor. When researchers asked MP3 player owners which one they bought most recently, the Zune was in second-to-last place, with only 2% of respondents naming it. Nearly everybody else--Toshiba (2%), iRiver (3%), Samsung (4%), Coby (4%), Creative (8%), Sandisk (11%), Sony (11%), and Apple (43%)--was ahead, with only Archos trailing. Now, this was before before Microsoft had cheaper Flash-based Zunes, while most of these other companies have multiple models on the market. Still, given the amount of marketing Microsoft put behind the Zune, I was surprised to see so many other companies ahead in the U.S.--the global figures are probably even lower, given that Zune isn't available anywhere else. The Zune group's recent silence about market data and price cut on the 8GB model don't bode well, but we'll see what the figures say for holiday 2008.

Tags:
Tech Culture
About the author

    Matt Rosoff is an analyst with Directions on Microsoft, where he covers Microsoft's consumer products and corporate news. He's written about the technology industry since 1995, and reviewed the first Rio MP3 player for CNET.com in 1998. He is a member of the CNET Blog Network. Disclosure. You can follow Matt on Twitter @mattrosoff.

     

    Join the discussion

    Conversation powered by Livefyre

    Show Comments Hide Comments
    Latest Galleries from CNET
    15 crazy old phones from a Korean museum (pictures)
    10 gloriously geeky highlights from 2014 (pictures)
    2015.5 Volvo XC60: updated tech, understated design
    Busted! CNET readers show us their broken devices (pictures)
    Take a closer look at the BlackBerry Classic (pictures)