Downloads top music sales

As legal music downloads soar, the music industry is divided over the future of the CD. Trish Lorenz considers both sides of the debate.

Downloadable music is here and it’s here to stay. From an inauspicious start – as a barely legal market driven by peer-to-peer software, appealing to tech-savvy early adopters in the late 1990s – downloading music is rapidly becoming mainstream.

This year, it has developed critical mass. According to UK record industry trade association BPI, by last month legal downloads for 2005 had topped 13 million, more than double the figure for last year. In April, downloads of singles were included in the official UK chart for the first time, thanks to the success of Apple Computer’s iTunes and iPods.

In response to the pioneering efforts of the product manufacturers, like Apple and Sony, music retailers HMV and Virgin Records launched their own downloadable offering this month. And last week Motorola introduced ROKR, the first mobile phone to incorporate iTunes, on the same day that Apple announced the iPod Nano, a credit card-sized replacement for its best selling iPod Mini MP3 player, that’s driven much of the growth in this market (DW 15 September).

With retailers on board, hardware available, industry support and consumer acceptance, it seems downloading is heading for the top of the charts. Is the age of the CD lurching to an end and what does this mean for designers working in the music industry?

Those in the know are divided over the future of the CD. HMV digital label liaison manager Tom Linklater believes people will still buy CDs in the future. ‘Downloading will supplement record collections,’ he says. ‘Artwork and lyrics, along with the whole process of selecting albums and putting on music, are benefits downloading can’t offer.’

‘It’s not like the move from video to DVD, or cassettes to CD, where in both cases there were real quality improvements,’ he adds. ‘Downloading is all about convenience.’

But he concedes, ‘More and more people have the means to play downloadable tracks and are willing to shop for digital music.’ He predicts a market share of 20 per cent for downloads by 2010, up from a mere 3.6 per cent today.

Others go further. Holler director James Kirkham believes downloading will have a majority market share within the same period.

‘It will take time, maybe five years,’ he says. ‘The biggest influence is the advent of mobile phones that act as MP3 players, and big players [like HMV] entering the market.’

The group works across the music industry, with labels like Island Records, Polydor and Mercury, along with Warner and Virgin Records as clients.

Kirkham explains that, as the market for downloads continues to grow, designers working in the sector need to consider how best to adapt their work to digital platforms, be that Web, mobile phone or MP3 players. Digital solutions are becoming paramount, he says, both in building awareness and in driving sales.

‘More and more labels are using a game or promotion on-line to break an artist, because playing a game or interacting in some way while listening to the music is much more engaging than pure artwork,’ he asserts.

Kirkham points to several of the group’s recent projects as examples. It created a website for Welsh rap group Goldie Looking Chain’s latest single Your Missus is a Nutter – www.yourmissusisanutter.com – to promote the band to a new audience, and another for Jamiroquai that uses only the group’s ‘Buffalo man’ logo to identify it with the band – www.jamiroquai.com.

‘The site isn’t reliant on artwork and was actually the lead aspect of the campaign, raising awareness for the tour and forthcoming single, way before artwork was even realised,’ Kirkham says.

The growth of downloading could also have implications for interior designers working in the sector. HMV has already launched ‘digital areas’ in its stores, where staff help customers to download music and MP3 players are sold, to promote its digital offer.

‘The area is distinctively branded and features interactive consoles with a virtual guide to downloading,’ explains Linklater.

The future could be more radical. In the US, market leader Apple is trialling a ‘mini’ retail strategy, with six stores, each 70m2 – half the size of standard shops – already up and running. Significantly, these stores focus on music offerings, with half of the products iPod-related, according to Apple chief executive Steve Jobs.

But even on this point there is debate. A core of music fans will always seek to browse titles, much like those who still buy vinyl today do, says Greig and Stephenson director Howard Bates.

The group has worked with HMV for nine years and, according to Bates, ‘Technology is now playing a massive part in music retail, but the way music is sold is very simple – alphabetically and by genre. You can’t break from that, the format is right.’

It’s clear that the music industry is in a process of change and what that means to design is a matter of perspective. Traditional sleeve design may become less prominent, but opportunities for creativity across all disciplines are likely to grow, as record companies, artists and retailers continue to seek innovative ways to promote their wares.

Downloading – the statistics

• In 2004, 5.7 million tracks were sold legally, compared to virtually zero in 2003. So far this year, weekly sales have regularly topped the 500 000 mark – and 13 million legal downloads were sold by 1 September

• In the final quarter of 2004, 96 per cent of download spend was by males. By the first quarter of 2005, women were buying too, with men’s share falling to 73 per cent

• Surprisingly, 45-54 year olds are the biggest spenders on digital music services, accounting for 34 per cent of overall spend, with those aged 12-24 accounting for 27 per cent

Source: BPI, 1 September 2005

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