Survey Confirms Strength of Napster Brand
MINNEAPOLIS, Sept. 18 /PRNewswire-FirstCall/ -- According to a recent
survey conducted by U.S. Bancorp Piper Jaffray Senior Software Security and
Design Analyst Gene Munster, 67 percent of the 200 consumers surveyed
indicated that if they had a user-friendly option for online music they would
buy online instead of going to a record store. The survey focused on consumer
awareness and themes related to online music. Specifically, Munster asked
individuals about brands in online music, illegal file sharing, Internet usage
and the Recording Industry Association of America (RIAA) lawsuits.
Of the people questioned in the survey, 38 percent indicated that they
have illegally shared music online through file swapping networks (Kazaa,
Morpheus, etc.) within in the past three months. In addition, 70.5 percent
were aware the RIAA is suing individual file swappers.
"We expect to continue to see the number of file swappers to decline as
the awareness related to the record industry's crackdown spreads," said
Munster. "We believe that it is likely that many of the individuals using
illegal file sharing networks will decide to look for a legitimate online
music download service. While the concept of mainstream online music
purchasing is still primarily a vision, we believe that this is a shift that
many consumers are poised to make."
According to the RIAA, the U.S. music industry posted revenue of $12.6
billion last year. Munster believes that a significant portion of these sales
will move online over the next several years. In his opinion, there are a
number of underlying trends moving the market in this direction, including:
crackdown on file-sharing networks, proliferation of high-speed Internet
access and continued growth of consumer CD and DVD burning. Munster expects
the online music market to grow to approximately $240 million in 2006 from
16.9 million in 2003.
With 92.5 percent brand recognition among those surveyed, Munster believes
that Napster, which will be relaunched by Roxio, Inc. (Strong Buy, #, $10.46)
later this year, stands the best chance to benefit from this shift in consumer
buying habits. Similar competitors such as Apple's iTunes and Rhapsody had
brand awareness of 29.5 percent and 15 percent, respectively.
The survey was conducted at the Mall of America in Bloomington, Minn.
Respondents were in various age groups: 10-18 years old (7 percent), 19-23
years old (35.5 percent), 24-35 years old (37 percent), 36-50 years old (16
percent) and above 50 years old (4.5 percent). Sixty percent of those surveyed
were male and 40 percent were female.
To receive a copy of Munster's recent research report on Roxio, clients
and members of the media should contact Dana Wade at email@example.com or
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