Australian record sales – 2006 full year results
Digital music and strong Australian music sales buoy market
Sydney, 12th April 2007
Strong results from digital music and increased sales of Australian repertoire are some of the key trends for the local recording industry’s wholesale music statistics for 2006, the Australian Recording Industry Association (ARIA) reports today. The year also saw a welcome increase it the volume of CDs sold. In addition, although the value of the wholesale market for physical products declined during the year, that decline was significantly offset by the growing digital market.
In contrast to the experience of many international markets which, in the last year, have seen significant declines in both volume and value of sales, the Australian wholesale market increased more than 27% by volume when compared to 2005, due in large part to the substantial growth of digital music. While the wholesale market is still dominated by physical formats(which account for approximately 95% of the value of the market), digital music helped offset the fall in value in the physical market in 2006, reducing the overall decline to just over 3%.
Wholesale digital music sales increased dramatically during the period, up by more than 250% to $27.8 million. Digital music now accounts for 5.5% of total music sales by value, up from 1.5% at the end of 2005. As record companies continue to release large amounts of their back catalogue into digital channels, further significant growth in this distribution channel is anticipated. At present, online music stores offer over 3 million tracks to consumers and this is forecast to continue to grow significantly in 2007. In addition, the industry is responding enthusiastically to opportunities in the mobile market, with mobile based revenues (including full track downloads, videos and “realtones”) making up almost 50% of the overall digital market during the year.
The market for CD albums enjoyed an increase almost 8% by volume, but experienced a decline in value, falling just over 5% on the previous year. This volume increase again appears to be in contrast to the declines experienced in other international markets.
Sales of Australian repertoire increased significantly in 2006 representing 37.7% of the Top 100 album sales by volume, up from 27% in 2005. Thirty two Australian titles featured in the 2006 top 100 albums, including 7 local titles in the Top 10.
Music DVD volumes are also up by over 16% but, like CDs, the overall value of the music DVD market has declined.
While the decline in the CD single market has continued during 2006, that decline does not demonstrate a loss of interest by consumers in the single format. Rather, it represents a significant shift in consumer preference towards obtaining singles in digital formats. The growth of digital music over the past twelve months, in particular the growth in track based purchases, has significantly exceeded the corresponding decline in both value and volume experienced in relation to the CD single format in 2006.
For more information please contact:
Christy Hayes, ARIA Communications Manager