Paid Music Downloads up 150%

New findings from TEMPO reveal that in July of 2004, more than one-third (35 per cent) of American downloaders aged 12 and older had paid a fee to download music or MP3 files off of the Internet, roughly a 150 per cent increase over levels witnessed in late 2003 (compared to 22 per cent in December 2003). This translates into roughly 20 million people within the current US population (according to 2000 US Census figures). The report highlights the evolving role the PC has in music exploration, listening, and purchasing behaviours.

“In the past year, we’ve witnessed the high-profile launches of many new online music services and download stores. Combined with the RIAA’s ongoing campaign to curb file-sharing, this has prompted many increasingly digitally-dependent consumers to experiment with the legitimate online methods of music acquisition currently available,” said Matt Kleinschmit, Vice President for Ipsos-Insight, and author of the TEMPO research.

Thus far, adult downloaders aged 25 to 54 are most likely to have paid to download digital music (40 per cent among 25 to 34 year olds; 46 per cent among 35 to 54 year olds). Interestingly, downloaders aged 12 to 17 were the least likely of all American downloader age groups to say they have paid for digital music (16 per cent), perhaps reflecting the lack of non-credit card based payment methods available on current fee-based services.

Apple Computer, a driving force in online music, has announced that users have downloaded more than 150 million songs from its iTunes Music Store, marking another major milestone for the online music business. iTunes users are now downloading more than 4 million songs per week, a rate of over 200 million songs per year. Apple also sells iTunes gift cards in the US at Best Buy retail stores. “Crossing 150 million downloads marks another major milestone for the online music business,” said Eddy Cue, Apple’s vice president of Applications.

In another move to push online sales, Napster UK, a subsidiary of Roxio, was the first to launch the UK’s first ever digital music pre-paid cards. Available through the Dixons Group, the pre-paid cards are available as gifts or for those without a credit card, giving music fans a unique code that they can redeem against subscriptions or purchases of tracks from Napster’s catalogue.

Napster and Virgin Radio also launched the nation’s very first online music chart on national radio. The Napster Online Music Chart on Virgin Radio counts down the Top 20 tracks taken each week from Napster’s catalogue of over 1 million songs. The chart is not just based on permanent downloads, but also registers full-length streams and subscription downloads, helping to make it a relatively comprehensive assessment of online music tastes (albeit from a single source).