Digital music distribution is displacing physical products

According to a prognosis by Pricewaterhouse-Coopers (PwC), sales of digital music will grow by an average of 21 percent in each of the next five years, while sales of physical sound carriers will continue to decline. The consulting firm expects that the strong growth in the digital segment from 2014 onwards will be able to compensate for the declines in physical sales and, after years of stagnation, will again ensure increasing total revenues.

As Statista shows in a graphic, the strongest growth in the digital segment is expected from streaming. According to the PwC study, the growing offer and the increasing acceptance of legal streaming offers will ensure that the share of streaming in digital music revenues will rise to more than 16 percent by 2017. However, it cannot be assumed that streaming services will replace downloads as the largest source of digital music sales in the foreseeable future.

Drastic decline in sales of ringtones

In the meantime, ringtones are becoming less important for the German music industry. While the sale of ringtones and ringback tones accounted for more than a quarter of digital revenues in 2008, PwC expects this proportion to fall below one percent as early as next year.

Figure: The graphic shows a forecast of sales revenues from digital music distribution in Germany.

(Statist / asc)