Internet radio services such as Pandora are increasingly important platforms for new music discovery, according to a report released by NPD Group last week. The study also found that listening to Internet radio – 27% over last year, while listening to on-demand streaming music platforms is up 18%.
As Internet radio and on-demand listening has risen, the number of consumers who reported listening to music on CDs dropped 16 percent, while the music audience for AM/FM radio fell 4 percent, and the number of consumers listening to digital downloads declined 2 percent.
“Although AM/FM radio remains America’s favorite music-listening choice, the basket of Internet radio and streaming services that are available today have, on the whole, replaced CDs for second place,” said Russ Crupnick, senior vice president of industry analysis at NPD. “We expect this pattern to continue, as consumers become more comfortable with ownership defined as a playlist, rather than as a physical CD or digital file.”
96 million Internet users listened to Internet radio or an on-demand service in the past three months. In an interesting chart of usage rates of Pandora listeners to other music sources such as AM/FM, CDs, and digital music files on computers, the report shows that Pandora listeners listen less to all of those over time, but continue to listen to AM/FM more than the others.