51% of UK music downloads are now legal- survey

The 2008 Digital Music Survey, currently in its fifth year, is an independent survey of 1,500 UK consumers.

The survey strongly suggests that the industry can now battle more effectively for the monetisation of its content and gives three reasons for optimism.

Firstly, it indicates that the population of illegal downloaders in the UK has declined by 10% since 2007, deterred by a number of factors, but in particular by the threat of action against them and the availability of free legal music in the form of streams, downloads and webcasts.

The survey also shows that there is real opportunity to further reduce illegal downloading by way of further action by ISPs. 

ISP Action

The survey found that 72% of illegal downloaders say they would cease if contacted by their ISP. What's more, this level is equally strong among teenagers, the 'problem' age group in terms of attitudes towards illegal downloading.

Only a staunch minority (6%) say it wouldn't bother them at all if their ISP terminated their contract because of illegal downloading.  This potential for ISP action to make a real difference may be driven by the finding that 61% of illegal downloaders mistakenly believe that their downloading activities are currently being monitored by ISPs.

Legal music for free

The massive growth in available free music is diluting the need to download illegally. Over one quarter of all users of social networks have downloaded music for free and over 1 in 2 (52%) of illegal downloaders say there is no need to steal because of the availability of free legal music to download or stream. This movement is an important opportunity for the music industry as licences are sought and agreed by social network sites.

The second cause for optimism is the growing maturity of the digital model and exciting new revenue opportunities.

51% downloads now legal  

For the first time the incidence of legal downloaders has crossed the half way mark (51% of consumers) up by 9% from 47% in 2007. The growth in legal downloading is being driven mainly by the over 45s up from 28% to 39% and the 35-44 year olds up from 36% to 44%.

2 out 5 over 35s are now buying downloads at least once per month. This growth is being driven by the perceived functional advantages of downloads and in particular the ability to cherry-pick tracks and sample an album before deciding to buy the CD.

Music discovery

The announcements by YouTube and MySpace of seamless discovery and legal downloading is extremely good news because 68% of users of social networks occasionally or more often discover new music on those sites that they love (83% of MySpace users and 73% of YouTube users) and 1 in 2 people at least occasionally recommend their favourite artists to others on those sites.

New platforms for music

There are new revenue opportunities associated with digital delivery platforms eg 12% of consumers are willing to pay to watch live webcasts of gigs, and 34% are interested in going to cinemas to watch live gigs or DVD premieres.

Consumers ‘selling music’ virally

A significant proportion of consumers would be willing to act as digital music distributors. 26% would definitely or almost certainly consider 'selling' music virally via their social network profile or blog (split equally across the genders). This is a very interesting concept for the music industry because the majority of social networkers already have music on their profile and around 2 in 5 (38%) social networkers have been asked by others where they found their profile music.

The third major reason for optimism is the growth of YouTube which has overtaken MySpace (41% Vs 25%) as the preferred social network for music and in doing so has reaffirmed the permanent value of music and music videos in particular.

·         Nearly 1 in 2 (47%) prefer to watch a music video if it's available than simply listen to a track and 71% say the artist's official music video is the most desirable digital content.

·         Nearly three quarters (71%) say they can find all the music videos they want on YouTube. Put it the other way round - what value has YouTube without music videos?

·         The announcement of YouTube's ecommerce platform therefore gives the music industry a two-fold monetisation opportunity - a share of the streaming-related advertising income and a share of the digital download revenue.

On the decline in illegal downloading Russell Hart, Chief Executive of Entertainment Media Research, said: "It is quite evident that an ISP-led strategy has bite because illegal downloaders are fairly convinced that ISPs are more likely to act against them than the courts."

He added: "The resurrected music video is now more influential than ever and has become the music industry's trump card for engaging consumers and creating that long-term emotional connection required for monetisation. It is now the vital component in music marketing."

Alexander Ross, Music Partner at media law firm Wiggin, said: "The survey shows that despite the ubiquity of free music, there's an increasing willingness on the part of consumers to pay for music products if the package is right. This is a real opportunity for all constituents in the industry as they continue to work together with others to create those packages."

Methodology:

The 2008 Digital Music Survey was carried out in July 2008 using an online questionnaire by music research specialists Entertainment Media Research. This is the 5th year in which Entertainment Media Research has reported upon the state of the digital music industry.   The sample comprised over 1,500 music consumers aged 13-59 drawn from Entertainment Media Research's UK database

Source: http://www.entertainmentmediaresearch.com

www.wiggin.co.uk