Customers prefer convenience to actual ownership when it comes to music, Strategy Analytics reports-- leading to 40% Y-o-Y growth in streaming revenues (reaching $1.1 billion) by 2012.
Meanwhile download revenues will slow down, growing by 8.5% to $3.9bn, making way as streaming becomes "the leading revenue growth engine for the music industry in 2012."
Predictably physical music sales continue declining further-- Strategy Analytics forecasts 2012 packaged music sales will drop by -12.1% to reach $1.9bn. In comparison overall digital (including purchases from mobile devices) spending should reach $1.3bn with 17.8% growth.
The analyst predicts global digital music spending will overtake the physical by 2015-- although some countries (including Sweden, the US and S. Korea) are shifting to digital at a much faster rate.
"Streaming music services such as Spotify and Pandora will be the key growth drivers over the next five years as usage and spending grow rapidly," Strategy Analytics says.
Making streaming services even more attractive is cloud-based storage-- allowing instant, seamless access to one's existing music library via a range of connected devices.
Go Global Digital Music Sales to Top $8.6bn in 2012 (Strategy Analytics)