Fast Company

Digital Music Revenues to Hit $20 Billion by 2015

The cash will come largely from subscription services, predicts an analyst/soothsayer. Music stores like iTunes, having already seen declined growth, will suffer.

cell phones with mini guitar amps

Digital music revenues worldwide could reach $20 billion per year by 2015, according to new report from the research firm Ovum. Mark Little, the analyst behind the report, predicts a 60% growth over the next four years in revenue from digital music subscription services. And as consumers realize they can get all the music they want for a monthly fee equal to the cost of a CD, Little thinks, track-by-track sales on iTunes and elsewhere are likely to suffer; digital music store growth slowed to 3% in 2010.

But even the apparently healthy number of $20 billion might mask the fact that the industry could be doing even better, says Little. “There’s too much free music available, and not just the illegal kind," he told New Media Age. "Free internet radio such as Pandora or Grooveshark, and freemium on-demand music services such as Spotify, are offering music without maximising advertising or premium subscription revenues for themselves or the industry."

Subscription music services are likely to come soon from the likes of Google, Apple, and Spotify. If nothing else for the music business, it looks to be an interesting next four years.

Follow Fast Company on Twitter.

[Image: Flickr user James Cridland]

Read More: Most Innovative Companies: Pandora

Add New Comment

1 Comments

  • Michael Garner

    Interesting times we live in as cheaper bandwidth and storage are opening the door to higher quality music streaming and downloads. Rumors abound that Apple is looking into offering lossless, higher resolution downloadable music. I imagine this is a preemptive move to combat streaming sites, and pssobly sell an HD audio iPod. I happen to care a lot about sound quality, and this bodes well for my selfish little ears. As convenient as iPods are, the thin, sizzly sound is the audio version of an 8 bit GIF photo.