Online Music: Saviour of the European music industry

28 August 2006

The sale of music online in Europe is becoming the new trend as the sales of music in CDs are in decline. This is the better scenario for the European music industry, but this boom will not happen overnight. According to Screen Digest, the sales of online music will rise from €121 million to around €1 billion in a span of four years beginning in 2005. But will this be enough to save the ailing European music industry?

Dan Cryan of Screen Digest said, “Online music has been booming. However, online sales alone are not going to be enough to halt the decline in music sales”. The author of ‘Online Music in Europe: Market Assessment and Forecast’ somewhat agreed with Cryan when he said, “The music industry needs to make the most of new delivery platforms. We believe that with the right strategy – including mobile and online – the worst might be over by 2010".

Since 2001, the European music industry has been experiencing loss due to several factors, such as the shift of retailers and consumers from buying CDs to DVDs, mobile phones, even books, and of course piracy. It seems that the gain on these enumerated factors is the reason of the loss on CD sales. And while piracy and other forms of illegal reproduction of music still account for the big chunk of the problems, there are substantial improvements. According to the data of International Federation of the Phonographic Industry (IFPI), piracy on the net is in decline. Forrester, a research group, made a forecast that while CDs will still dominate the sales of the music industry, online sales will definitely catch up to it in 2011.