UK digital downloads spur singles revival

By Simon Aughton

Posted on 11 Oct 2005 at 15:51

The UK record industry has reported booming sales for the latest quarter led by the growth of digital music.

Single track downloads have revitalised the 'singles' market, regularly making up 60 per cent of singles sales, compared to less than four per cent at the beginning of 2004. Almost 17 million tracks have been sold so far this year, and the figures do not include downloads from music subscription services.

Such has been the impact of digital sales that the singles market grew by 49 per cent in the third quarter despite a 21.8 per cent decline in physical sales, although it is worth noting that the average price paid for a UK download is 88p, compared to £3.05 for a physical single. Interestingly 7in vinyl singles, which tend not to be as expensive as their CD equivalents, continue to buck the trend with sales growing by 80 per cent over the past 12 months.

'This year digital made the transition from mere potential to becoming a significant revenue stream,' said Peter Jamieson, chairman of the BPI, 'But this is just the beginning.'

The wide variety of choice that digital music stores provide is reflected in the greater number of different tracks that are being sold: 80,000 in August compared to 55,000 last year. Eighty-one per cent of download sales are outside the charts.

Until now men have dominated the market. But whereas in January 2004 they made 96 per cent of all purchases, they now account for 69 per cent. Somewhat surprisingly under-20s are starting to make an impression, despite, on the whole, not having their own credit and debit cards.

'This time last year, the market was driven by technologically-savvy early adopters, usually older male buyers, but young consumers and female music buyers are clearly beginning to take advantage of these new services,' Jamieson said.

Despite the widening demographic, the majority of purchases are made by a minority of downloaders. Moreover just three per cent of the UK population have paid for digital music.

Apple claims over 70 per cent of the UK downloads market through its iTunes Music Store and with a record iPod sales to be announced later today in the company's quarterly financial results there is little to suggest that its dominance is set to wane.