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Music sales boost online spending

Song downloads hit a high note with consumers, pushing online spending up 14 percent from a year ago.

Online spending reached $1.8 billion in 2004, up 14 percent from a year ago, as music downloads hit a high note with consumers.

About 19 million U.S. consumers shelled out money for online content in the fourth quarter of 2004, up 2.6 million from the same period a year ago, according to a study released Thursday by the Online Publishers Association. The OPA worked with ComScore Networks on the survey.

The entertainment/lifestyles category, which includes paid music downloads, saw 90 percent year-over-year growth in 2004, growing from $217 million to $413 million in revenue, the study showed.

Contrary to some other recent reports, the study said sales of individual song tracks hit an all-time high in 2004. Indicating a shift away from subscription-based services, single purchases constituted 15 percent of total online content sales in 2004, compared with only 11 percent in 2003.

In terms of revenue, the online personals/dating category managed to stay at No. 1, with $470 million, but year-over-year growth reached only 4 percent.

Sports and games fared well, with 38 percent and 22 percent growth, respectively.

"The fact that entertainment/lifestyles, sports and games were by far the year's fastest-growing paid-content categories is further evidence that the Web is on its way to becoming a true entertainment medium for U.S. consumers," OPA President Michael Zimbalist said in a statement.

A few sectors witnessed a slump, however; the business/investment category, for instance, saw 2004 revenue drop to $313 million from $334 million in 2003.