Subscription Based Music To Hit $3 Billion

    January 10, 2008

People will increasingly choose music rentals over owning music according to Juniper Research’s "Mobile Music Services: Ringtones, Ringback Tones and Original Recordings" report.

Juniper predicts that the market for subscription-based music rentals will hit $3.3 billion in 2012, surpassing spending on original recordings.

"Music rental services are incredibly ‘sticky’, in that once consumers have taken the time and effort to build up an extensive playlist, they will be increasingly reluctant to unsubscribe from that service and from the operator, thereby providing a significant boost to ARPU (average revenue per user) levels," said Windsor Holden, author of the report.

Juniper based its projections on 3G rollouts in emerging markets, which would promote full-track download sales. Download sales in the Indian subcontinent will reach close to 480 million in 2012, up from less than 2 million in 2007.

The worldwide market for end-user generated mobile music revenues will rise to almost $17.6 billion in 2012, from $8.9 billion in 2007.

Total revenues from original recordings delivered to handsets, including both purchases and rental subscriptions, will increase to $6.1 billion in 2012 from $960 million in 2007