Digital music to outsell physical this year

News

Tim Green Jan 16 2007, 11:00am

Singapore’s digital music specialist Soundbuzz says online and mobile music sales will overtake physical sales across Asia in the next 12 months.

It believes the global market will emulate this trend in the subsequent 18-24 months. Soundbuzz has analysed its own sales data along with market projections from PricewaterhouseCoopers, the IFPI and others to make its dramatic conclusion.

The company claims South Korea will be the first country in the world to buy more digital than CD product, followed quickly by India. It also asserts that mobile will be the primary driver. A spokesperson said: “What is clearly evident is that digital music in the Asian context is defined by mobile music…with mobile music growth fuelled by additional formats to ringtones – including ringback tones, caller ID tones, full track audio and video downloads.”

Although ringtones will dominate the mobile scene, Soundbuzz claims these new products will contribute $3.9bn to the market by 2009 from $210 million in 2005. Meanwhile online sales will remain relatively static in the coming three years.

Globally, mobile music will be worth $20.23 billion in 2009 against $7.53 billion for online and $18.09 million for physical sales.

The numbers illustrate the primacy of mobile over online in the East. This is reflected in the strength of services such as SK Telecom’s Melon, which offers downloads and rental subscriptions to South Koreans and has accumulated over five million subscribers (500,000 of them active).

Soundbuzz is Asia’s largest digital music company, with more than 50 stores selling more than 400,000 tracks online and via mobile. It has its own store but also provides content and/or infrastructure to Motorola, Airtel, SingTel, Sony BMG, Telstra and others. The company averages three million mobile music downloads a month including ringtones, truetones, ringback tones and full song and video downloads. This compares with an average of 200,000 online music downloads per month.