A recent report from market-research firm In-Stat says that digital sales will account for 40 percent of all music purchases worldwide by 2012.
The numbers show we will see incredible growth in digital sales over the next four years. In 2007, digital sales of music accounted for 10 percent of the total worldwide music market, up from 6 percent in 2006.
In-Stat sees a couple of factors contributing to this growth including the the expansion of broadband, demand for single track downloads and expanding music catalogs. Full track downloads to mobile phones will also be a factor in the next few years, the report said.
Of course, there are still obstacles to any potential growth in the music business and in this case they aren’t new problems.
“Digital piracy continues to represent the primary challenge to online music service providers,” said Stephanie Ethier, In-Stat analyst. “Other obstacles still include the lack of interoperability between services and devices due to differing digital rights management (DRM) technologies, and weak consumer demand for subscription-based services. Another potential market inhibitor is the fact that content owners, cellular service providers and handset manufacturers are increasing the amount of marketing and promotion for mobile music.”
However, digital music sales is still a lucrative business. Sales for online digital music reached $3.05 billion in 2007, up 48 percent from 2006.
This is great news for Apple’s iTunes Store. One week ago, Apple took over the top stop in digital music sales in the United States, beating out Wal-Mart.