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Port Washington, N.Y. – More than a quarter of Apple (NASD:  AAPL) iTunes,
iPod and iPhone users in the U.S. surveyed recently expressed "strong
interest" in a free, cloud-based music streaming service, while
"between seven and eight million" people reported strong interest in
a paid subscription version of such a service. Market research firm NPD Group asked iTunes users —
estimated to total 50 million in the U.S. — about free and unlimited streaming
of their iTunes libraries over the Internet, as well as subscription options.

A
model that offered free streaming would attract 13 million to 15 million subscribers,
according to the survey, while between 7-8 million U.S. iTunes users indicated
a willingness to pay a minimum monthly fee of $10 for such a service.

"After
the service’s launch, user numbers could conceivably rise substantially, as
they upgrade to newer connected devices and actually experience the benefits of
cloud-based music," said NPD Group analyst Russ Crupnick.

"If the
consumers who indicated strong interest in a paid subscription actually adopted
one of those services at $10 per month, the market opportunity is close to $1
billion in the first year, which is roughly two-thirds the revenue garnered by
the current pay-per-download model.

"We don’t yet know what, if any,
effect these services might have on the traditional pay-per-download music
model, or whether consumers will ultimately spend more on digital music
overall, if or when any of these options eventually rolls out," Crupnick
added.

 

Related Links:
http://www.npd.com/press/releases/press_100714.html

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