trends

http://www.couriermail.news.com.au/common/story_page/0,5936,8501677%255E8362,00.html

Music lovers to discard CDs for Net downloads
Jennifer Dudley, technology reporter
27jan04

COMPACT discs will be virtually obsolete in five years, replaced by Internet music downloads.



The popularity of digital music was already costing the American music industry $700 million a year among 12 to 22-year-olds, the Forrester Research report found.

That figure would increase dramatically by 2008.

"By 2007 or 2008, CDs will be something only old people have," research author Josh Bernoff said.

"More than $4 billion of the US music market's $13 billion sales will come from downloads and subscriptions by 2008."

Music industry sources and Internet experts said a similar situation could happen in Australia, but questioned whether the CD would disappear in five years.

Mr Bernoff presented the report, From Discs to Downloads, at the annual music and technology forum MidemNet in France.

He said half of Internet music downloaders reported buying fewer CDs and CD sales would fall 30 per cent from their 1999 peak as the trend continued.

"The industry is going through a complete change in the way people consume music," Mr Bernoff said.

He said consumers would eventually rather "connect to entertainment" than own it, spelling the death of the CD.

Destra Music chief executive Dominic Carosa said the popularity of digital music also could mean the end of the CD in Australia.

"My view is that more than half of all music will be purchased online in the next three to five years," he said. "The CD replaced the tape and the record and in the not too distant future digital files for music and videos will replace CDs and DVDs."

Mr Carosa, whose company provides online services for music retailers, said the trend would dramatically change Australian music stores.

"In the next five years, rather than just buying records you'll be able to walk into a music store and have a coffee and listen to new music and buy an Internet subscription or pump new music into your digital music player," he said.

But Internet Society of Australia executive director Kate Lance said demand for CDs would remain as long as there were people without access to the Internet.

"I don't think we'll ever reach 100 per cent Internet penetration and there's an awful lot of people not connected to the Internet who listen to classical music on CDs," she said.