Over the past few days, there have been a number of publications on music news websites claiming that the death of the digital download is coming fast.
According to Nielsen's research, download rates of singles have dropped by 42% over the past four years, and if this trend continues the music download might be dead by as early as 2020.
More importantly, the rate of decline appears to be increasing year-on-year. Between 2014 and 2015 the rate of decline was 10%, but this has increased to 24% between 2015 and 2016.
Meanwhile the use of music streaming services has skyrocketed, having jumped 97.4% year on year.
It is easy to see how if the industry lost the same number of download sales every year, that entire segment of the market would disappear within four or five years. It’s not entirely impossible, but we think it is highly improbable. Why?
Music downloads are definitely past their peak, but that doesn't mean they don't have a future.
After all, when the overwhelming convenience of downloads pushed people away from CDs there were (and still are) those who prefer to keep their music physical.
Before that, when the industry moved from vinyl to CDs, people still hold on to their records, the sales of which have actually been rising in recent years.
In fact, according to the same Nielsen report, over 100 million albums have been sold in the U.S. so far in 2016. That number is certainly lower than it would have been in 2000, 2005, or 2010, but 100 million records is not exactly something to ignore.
Also, despite the fact that the number of people switching to streaming increases every day, there are still millions upon millions who either haven’t tried any of the options yet, or who aren’t interested in doing so. There are still those that want to own their favorite music, and since we’re not talking about shuttering any more record stores, there is little reason not to keep offering downloads as an option for those who want them.
The music downloads currently offer something that no other music format can, namely the ability to carry high-resolution audio, which is better quality than that which is currently offered by CDs.
Music formats only die when they can't offer anything unique. Cassette tapes died because MP3 players offered portability in a better-sounding smaller form-factor. VHS died because DVDs did likewise.
But while music downloads continue to offer something that no other music format does they will never die.