Daily Archives: January 4th, 2011

One Third Of US Internet Users Have Paid For Music Online

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The Pew Internet and American Life Project reports that 2/3 of Internet users have paid for digital content. Thanks to pervasive broadband penetration in the US users can quickly and easily download software, movies, television shows, music, e-books, and news articles.

The survey asked more than 750 adults whether they had ever paid to access or download a list of 15 types of digital content, ranging from digital music to ebooks, movies, photos, games, apps, adult content and more. 33% of Internet users said they had paid for digital music online – which presumably includes downloads as well as access to premium streamed content. Digital music topped the list of items consumers were most likely to pay for.

It’s a study that validates the premium subscription revenue model and has great and positive implications for media companies that are struggling to recover revenues lost to dwindling circulation or audience for their traditional media. Beginning this month the New York Times will lock down unlimited access to its website under subscription, limiting online access to its content to online or newspaper subscribers.

Streaming music services have struggled to develop successful business models as well, with some services such as Pandora and Slacker exploring both ad supported and premium no-ad subscription platforms. Others such as Rhapsody and MOG deliver on-demand streaming songs for a monthly subscription. This seems to be a model favored by the record labels, who have refused to license on-demand service Spotify in the US for their ad-supported on-demand service. Pandora, Slacker and other webcasting services, which do not deliver on-demand songs, have a compulsory license (and associated royalties) for such.

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