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Gartner Survey Shows MP3 Users Buy More CDs Than Non-MP3 Consumers |
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| Survey of 40,000 Representative U.S. Households Shows MP3 Boosts Music Sales | ||||||||||||||||||||||||
| San Jose, Calif., July 27, 2000 — Despite criticism that MP3 and MP3 promoting software is hurting the music industry, a recent survey by Gartner Group, Inc. (NYSE: IT and ITB) shows MP3 users are buying more CDs than non-MP3 users. Gartner surveyed 40,000 U.S. households in February, and this survey revealed MP3 users are purchasing three more CDs on average in a six-month period than non-MP3 users. | ||||||||||||||||||||||||
| "It's very clear that the segment of consumers that is purchasing significantly more CDs is also more receptive to digital distribution," said Sujata Ramnarayan, senior analyst for Gartner's e-Business Services group. "Instead of working against MP3, it's time that the RIAA and record labels start making MP3 work for them to sustain, nurture and grow what appears to be MP3's positive correlation with music sales." | ||||||||||||||||||||||||
| A significantly greater number of MP3 users are using the Internet both to purchase music CDs and get product information. MP3 users are still making in-store purchases - in fact, 58 percent compared to 50 percent of the general population (see Table 1). However, their mail order/phone purchases is lower compared to the general population. | ||||||||||||||||||||||||
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Table 1
Note: This table data is based on those who listen to music regularly at home. Source: Gartner (July 2000) |
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| There could be several reasons why MP3 users are purchasing more CDs relative to non-MP3 users. Ms. Ramnarayan said it is possible the convenience of getting music online is exposing consumers to a greater variety of music that they can try before buying. The immediate nature of "trial and purchase" that the Internet offers can also help sales among MP3 users. | ||||||||||||||||||||||||
| "The fact that a greater percentage of MP3 users are still making in-store purchases or purchasing online would suggest immediate gratification is a reason for greater incidence of purchase," Ms. Ramnarayan said. More details are available in an upcoming report titled "Is Napster Hurting Music Sales?" Gartner also believes that dominant business models moving forward will allow consumers to purchase and download music on a per-track or per-album basis, rather than on a subscription basis. A companion piece to follow will address details on the viability of different digital music distribution models. Additional information on this survey is available to subscribers of Gartner's e-Business Services group. To subscribe to this program, please call 800-419-DATA, or 408-468-8009. | ||||||||||||||||||||||||
| Gartner provides unrivaled thought leadership for more than 10,000 organizations, helping clients to achieve their business objectives through the intelligent and efficient use of technology. Additionally, Gartner helps technology companies identify and maximize technology market opportunities. Gartner's technology content and strong brand reach IT professionals globally through Gartner Research, its research and advisory unit, Gartner Services, its custom consulting unit; Gartner Events, including Gartner's renowned Symposia; and, at www.gartner.com. Gartner subsidiary TechRepublic, Inc. (www.techrepublic.com) is the leading online destination developed exclusively for IT professionals by IT professionals. Gartner, founded in 1979 and headquartered in Stamford, Connecticut, achieved fiscal 1999 revenues of $734 million. Gartner's 3,600 associates, including 1,200 research analysts and consultants, are in more than 80 locations worldwide. For more information about Gartner's industry-leading products and services, please visit us on the Web at www.gartner.com. | ||||||||||||||||||||||||
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