London – Cloud-based music streaming services, such as those
offered by Rhapsody and Spotify, "will become a more important form of
access to music than owning albums or songs by 2016, according to a report from
market researcher ABI Research.
Driven by the growing use of smartphones, ABI
projects the number of subscribers to cloud-based music services will grow at
an annual rate of nearly 95%, and exceed 161 million in 2016.
The number of
subscribers to cloud music services is expected to top 5.9 million by the end
of this year.
Sometime next year, ABI analyst Aapo Markkanen predicts, "the
Asia-Pacific area will become the largest regional market for mobile music
Prices for cloud music services are expected to gradually
decline as they reach mass markets.
"Forecasts of declining prices are
based on the assumption that the rights-holders will lower their royalty
demands," said ABI’s Neil Strother.
"Record labels and collecting
societies should not overplay their hands when it comes to royalty issues. If
consumers do not have convenient and affordable legal alternatives, they will
simply enjoy their music by other means."