Internet Impotent in Music-Buying Decisions?

Last month, I discussed the troubles companies have driving revenues through online music services. Sonific had shut down and Snocap was sold to Imeem for what was rumored to be fire-sale prices. On Friday, the Pew Center for Internet Research provided some data that may explain some of the trouble these folks are having.

The Pew report cites an ABC news story pointing to the crux of the problem:

"Shipments of CDs peaked at 942.5 million units in 2000 and fell by 25% to 705 million units in 2005. Figures released earlier this year show that album sales fell by 9.5% in 2007, even though digital sales grew by 45% in this period." (
Alex Veiga, U.S. Album Sales Down, Digital Up. Associated Press, January 8, 2008. Available online at: http://abcnews.go.com/Business/wireStory?id=4081901. Accessed on May 8, 2008.



Among internet users who research the music they buy online, their methods are varied (picture left), but only 32% of those who said they used music said their online research was definitive in making their purchasing decision. In order, the top 5 effects of online music research were:

1. Learn more about the band
2. Learn about new artists
3. Save money on music purchases
4. Buy more music than was planned
5. Changed their mind about the artist or song they were going to purchase.

By and large, it is offline influences that continue to drive the music purchasing decision according to the survey data.



Now, the 70+% of users who say that friends and family are impactful in driving their music purchases could certainly include folks interacting on social networking sites like Facebook or MySpace. Applications such as iLike on Facebook that allows friends to dedicate songs to others can be source of new music.

Activities for online music research are also varied, and certainly skewed towards the younger generation. The Pew Center caveats this report with the fact that litigation fears may drive many people to not respond in the positive to the question of whether or not they download music.



Given the large concentration of offline influences and purchases, it becomes more understandable why a fragmented strategy towards digital content sales may not drive the fortunes of many companies and the benefits continue to be concentrated in the likes of iTunes and Amazon. However, Apple's recent success in surpassing WalMart in music sales is evidence that more sales may move to digital. In the meantime, it will be interesting to see how the content vs. free advertising-supported listening shakes out. It's not likely to resolve itself in the same timeframe as BluRay vs. HD DVD.

New Mobile Web Usage Data

The Pew Center for Internet Research is one of the best sources for unbiased data you can find. The non-profit conducts survey and publishes them openly on their websites, and unlike a number of other sources, it's a safe bet no companies have funded the research that can have a deleterious impact on data integrity.

The center conducted a survey of 2,054 people in December and published the results on their website.

At Least 17 Million Daily Mobile Web Users

One of the most difficult numbers to find for us has consistently been the number of mobile web users, as distinct from those who use text messaging. A number of sources, though, point to the total number of Mobile Web users to be around 46 million, confirmed by this research that indicates 19% of the 240 million mobile phone users to have accessed the mobile web. 7%, or 17 million people, access the mobile web on a daily basis.



Note, I am looking only at the line item for accessing the internet for news, sports, or weather information. Another 27% have played a game, though the survey does not distinguish between web-based and locally. 19% used it for email, 14% for map information and 10% to watch a video. The email users probably includes BlackBerry users, and map information could be web-based such as Gmaps or MapQuest, or it could be built into the OS like Google Maps on the iPhone. Videos are becoming more ubiquitous with YouTube, Treemo, and others, as well as being served up through ads.

The moral of the story is that the number of mobile web users may be much higher.

The Internet and Mobile Web are certainly perceived as a young person's game, but here is some data:



96% of mobile phone users under 30 have participated in one of these activities. That is pretty incredible. I do have to give my folks credit for bumping up the 50-64 category.

The study also has some ethnographic data, but I'm not sure what meaning to impute from that.

I'll leave you with the fact that more young people would rather give up the "Interwebs" than their cell phone. Where do you rank in this category?