Digital Streaming Changing Music Listening Habits

A new study by market researchers NPD Group found that half of US internet users listened to an online radio station or from an online on-demand service in the last three months. A bit more than a third (37%) listened online through a streaming service (Pandora or Internet radio). a bit less (36%) listened via a pure on-demand service.

  The shifts in listening patterns are becoming apparent - over the last year, Internet radio listening is up 27%, audiences for on-demand music streams is up 18%, listening to digital downloads is down 2%, listening to terrestrial radio is down 4%, and listening to CD's is down 16%.

“Although AM/FM radio remains America’s favorite music-listening choice, the basket of Internet radio and streaming services that are available today have, on the whole, replaced CDs for second place,” said Russ Crupnick, senior vice president of industry analysis at NPD. “We expect this pattern to continue, as consumers become more comfortable with ownership defined as a playlist, rather than as a physical CD or digital file.”

The study also looked at the changing music listening habits of Pandora users. Compared to 2009 levels, the number of Pandora users listening to terrestrial radio is down 10%, listening to digital downloads on personal media devices is down 21%, and listening to CDs (on devices other than PCs) has fallen 21%.  Similar changes were found for listeners of leading on-demand music streamers.
  Still, the biggest change in listening is the result that 34% of Pandora listeners are listening in their cars over the car's audio system (directly, or indirectly through a link to a mobile connected device).
  As for those concerned that the shift to online music listening might tend to stifle interest in new music, the study found that 64% of online music service listeners reported that they had rediscovered old favorites and music, and 51% reported learning about new music.

“AM/FM radio has traditionally played a significant role in helping consumers learn about new music from well known artists, as well as finding new ones; however, Pandora and other music services are an increasingly important part of the music-discovery process.”

  Given that last result, the music industry might want to rethink their push in Congress to place significantly higher royalty fees on online music services - between the push for more royalties from radio and online, they may just price music listening out of regular use.

Source  -  The NPD Group: Internet Radio and On-Demand Music Services Rise, Putting Pressure on Traditional Forms of Music Listening, press release from The NPD Group