For years, the NPD Group has provided global sales and marketing information in a variety of businesses. This includes among other things, video games, consumer electronics, information technology and music. The new York Times is publishing a story this week about some interesting trends for music lovers. Especially those that would like to see prices come down some more.
In their latest study, NPD has found that in the last quarter of 2003, prices fell on the music CD about 2.5 percent. Furthermore, they have found that in the first quarter of this year, the CD has taken another dip this time 4 percent. Are we seeing a trend, if so, why? Well, they think they have the answer, read on.
'Had you not had peer-to-peer, it's unlikely prices would have declined as much as they have," Russ Crupnick, president of NPD Music, said, referring to music file-sharing services. Mr. Crupnick added, however, that music downloading was not the sole force behind the price declines. He said that music retailers were increasingly competing with cellphone services, DVD's and other forms of entertainment for customers' money. Mr. Crupnick said services that sell music online, like Apple's iTunes, have not yet had a significant impact on CD prices. 'The usage of any of those kinds of things is really, really tiny," Mr. Crupnick said. 'I would be surprised to see the industry immediately responding on a pricing level." |
This seems to be a very realistic view of the current situation and surely explains once and for all why the music CD has become vunerable to price reduction. What some of us may find interesting, even exciting, is the observation by Mr. Crupnick stating legal online services have not yet had a chance to impact pricing. Let's hope that we will see a continuing decline in the price of this medium, as it's a darn good way to purchase our music.
Source: The New York Times
