CDs still popular purchase

APPLE A DAY

Plugged In

May 22, 2008|By DAVID ZEILER

Despite all the attention the media have lavished on the iTunes Store, CDs still dominate music purchases by a huge margin, according to a study released Monday by the Pew Internet and American Life Project.

The survey, conducted by phone last August, focused on how the Internet influences consumer purchases of music, cell phones and houses.

The Pew report says 82 percent of music buyers still prefer the old-fashioned CD. An eyebrow-raising 62 percent said they purchased all their music on CD, with 20 percent more saying most of their purchases were CDs. Only 12 percent said all or most of their purchases were via digital download.

How can this be? Just last month research firm NPD declared Apple the No. 1 U.S. retailer in January with 19 percent of the market. Furthermore, the NPD report said digital downloads made up nearly a third of music purchases in January.

We keep reading news articles about plummeting CD sales and rising downloads. It doesn't seem to add up, but I think there's an explanation.

First, Pew's data almost perfectly mirror the recording industry's 2007 consumer profile statistics. That data show CDs making up 82.6 percent of sales, compared with 11.2 percent for digital downloads. In 2006, digital downloads were just 6.7 percent of music sales; in 2004, they were less than 1 percent.

Pew's survey was conducted six months before the NPD report. Remember, it was only in June 2007 that Apple ascended to No. 3 among music retailers (again, according to NPD data). Pew researchers would likely get significantly different results were they to conduct a music-buying survey this month.

Since the iTunes Store holds about 70 percent of the worldwide legal download market, Apple stands to reap great rewards from the inexorable move of music consumers away from CDs to digital downloads.

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