The NPD Group: Computer Listening Behaviors on the Rise; Radio is Still King, but Listening to Music on a Portable Music Player, Streaming Music Online and Listening to Music on a Computer Show Notable Increases in 2005

Business Wire, May 12, 2005

PORT WASHINGTON, N.Y. -- According to the latest MusicLab report from The NPD Group, even though radio, audio devices and music videos on television dominate overall music listening behavior, the computer is an increasingly significant medium for music listening. Computer listening behaviors are all on the rise compared to last year, with listening to music on a portable music player, streaming music online and listening to music on a computer showing the most notable increases.

Radio remains the most popular way to listen to music; however, radio listening actually declined four percent since last year (194 million people aged 13 and over listened to music on the radio in March 2005, versus 203 million who listened in March 2004). By contrast, listening to music stored on a computer rose by 22 percent (63.2 million to 77.2 million), online radio listening increased 18 percent (45.3 million to 53.5 million) and free streaming of online music increased 37 percent (33.7 million to 46.1 million).

"The rise of digital listening and storage for music continues unabated this year," said Russ Crupnick, president of the NPD Group's Music & Movies division. "Technology companies are providing new tools to consumers in the form of powerful music-enabled PCs and portable music players, music companies are answering the call for more content and consumers are responding positively."

NPD noted a marked increase in consumers ripping music onto their computers: this activity more than doubled (102 percent) since March 2004. The transfer of music to MP3 players also more than doubled (127 percent) since last year, while paying to download music files increased 93 percent. Consumer visits to music Web sites increased seven percent this year over last.

"Music listeners today are faced with a dizzying array of methods for obtaining and listening to music," said Russ Crupnick, president of the NPD Group's Music & Movies division. "Far from inciting confusion, these new technology-driven avenues may be helping consumers sample and enjoy music across a wider variety of music genres."

Sources: NPD's MusicLab Surveys are conducted bi-monthly among a group of approximately 5,000 consumers aged 13 years and older; results are calibrated and balanced to represent the U.S. population. The most recent survey was fielded in March 2005. NPD MusicWatch Digital information is collected continuously from the PCs of 40,000 online panelists balanced to represent the online population of PC users.

About The NPD Group, Inc.

Since 1967 The NPD Group has provided reliable and comprehensive sales and marketing information for a wide range of industries. NPD provides critical knowledge on what is selling, where, to whom and why to help our clients make more successful, fact-based business decisions. Today more than 1,300 manufacturers and retailers rely on NPD to help them better understand their customers, product categories, distribution channels and competition in order to help guide their business and positively impact sales and revenues. Information from The NPD Group is available for the following major vertical sectors: apparel, appliances, automotive, beauty, cellular, consumer electronics, food and beverage, foodservice, footwear, home improvement, housewares, imaging, information technology, music, software, travel, toys and video games.