Users Buying Fewer Digital Tracks and Using P2P Less

Here is a very interesting story from Slyck.com

March 31, 2009
Thomas Mennecke

There was a time when P2P was all the rage, and today it still pretty much is. What’s changing in the P2P landscape is how P2P technology is being used. If we compare today’s P2P climate with that of years past, the most noticeable change is the arrival and triumph of BitTorrent. The arrival of BitTorrent has changed the P2P landscape by streamlining the acquisition of large media files, and in response, the trading of movies and TV shows has risen dramatically.

That’s not to say BitTorrent can’t be used for trading small music files. It’s not particularly common, but more often entire albums or discographies are traded instead. As BitTorrent has become the pinnacle of file-sharing, other methods of listening to music are supplanting P2P. Even some hardcore file-sharers generally are finding the need to use “quick MP3″ networks such as Gnutella unnecessary.

Why? Because the Internet is now flooded with music. Take your pick, there’s Pandora, MySpaceMusic, and an untold number of radio stations. And with plenty of iPhone radio station apps, it’s not uncommon to find an iPhone user with zero MP3s on board.

This growing trend is supported by yet another NPD Group insight into the digital music market – and the news continues to be rather poor for digital music sales. In one of the more critical music markets, the teen demographic (age 13-17) purchased 19% less music in 2008 than in 2007. Breaking this number down further, teens purchased 26% fewer CDs, and 13% fewer digital tracks.

The teenage purchasing demographic often represents a snapshot into a market’s future, and today’s news is probably the furthest thing from good news. A downturn in interest by teenagers likely indicates that the future of paid digital music is not a particularly bright one.

The study also found that teens using P2P networks to acquire music fell by 6% – not a dramatic decline, but it does support the shift from P2P networking to streaming media. It also appears that teens aren’t burning CDs that much either, as this activity dropped by 26% in 2008. Conversely, teens using social networking and internet radio saw dramatic increases in 2008 – a growth from 34% in 2007 to over half in 2008.