Tag Archives: digital song sales

A Look At Digital Song Sales Trends

Tunecore, a company that enables artists to sell their music on digital platforms without a label, has released some interesting data on digital music behavior. Tunecore is a digital music distribution service that set out to democratize music distribution by making it simple and affordable for any artist to offer songs for sale. For a fee, an independent artist can place their song in selected online stores and streaming services and receive compensation based on the number of sales it generates.

Artists register with TuneCore, select the online platforms they would like to have their music placed on, upload their songs, pay, and get paid for every song sold or streamed with those services. Last year the service placed 61,000,000 songs and artists received $32,000,000 in compensation. TuneCore takes no percentage of the revenue artists earn. They work placing music with iTunes, Rhapsody, MySpace Music, Amazon, eMusic and others.

Artists can earn money from two different types of sales – permanent downloads, where customers purchase the song and download a file; and streams – where a listener pays a subscription fee to listen to songs – in that case, the listener is actually “leasing” the song, as TuneCore’s faq’s explain.

In 2009, 40% of TuneCore’s sales were from single track downloads and 57% were from streaming (which is per song). The other 2.3% of revenues were full album downloads. For song downloads, Rock is the most popular genre, followed by Alternative and Hip Hop. For streaming sales, Hip Hop wins followed by Alternative and Rock. Sunday is the best day for sales and Christmas day and the day after were the biggest days for song sales in the last six months. There’s even more data available, here.

Study: Digital Song Sales Would Go Up If Prices Went Down

Last year iTunes changed its pricing strategy for songs and began charging more for more popular tunes. The result? Music sales have slowed dramatically. According to several sources, digital song sales grew only 8% last quarter, versus 20% a year earlier for Warner Music Group, with the industry’s fourth quarter growth rate at only 5% over the previous year.

I guess consumers didn’t like seeing the prices increase 30% from .99 to $1.29…

There’s a new study that even suggests that if record companies lowered prices, not only would it spur song sales, but it would also help to combat illegal downloading. The optimal song price, says Wharton business school marketing professor Raghuram Iyengar, is between 60 and 70 cents per song. That’s based on research with over 600 digital music consumers, and laws of supply and demand. See, the forces at play here would indicate that music prices should be lower, not higher:  there’s increased competition, free alternatives, and declining distribution costs. But instead, prices have held steady and recently jumped substantially.

Unfortunately, as an article in Wired points out, the music industry wants to believe that by marketing their wares at higher prices, they are encouraging consumers to perceive greater value in them, rather than subscribing to the theory of supply and demand…

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