Digital downloads and streaming are expected to become the dominant methods of accessing media
Melbourne, Australia (PRWEB) October 09, 2014
Online CD, DVD and Blu-ray Sales in Australia is a rare case of an industry that emerged, peaked and will become near extinct in the space of just over 20 years. The ironic aspect is that the technology that gave birth to the industry – the internet – is ultimately the technology that is causing its extinction. The industry emerged as online shopping gained traction with consumers. Online retailers were able to offer a wider range of media, while consumers were able to easily browse titles and compare costs. According to IBISWorld industry analyst Andrei Ivanov, “as data speeds increased and the cost of internet connections declined, media providers started to experiment with delivering content to consumers via digital downloads and streaming.” This has sparked yet another change in the way consumers purchase their media, with digital media now replacing CDs and DVDs. As a result, industry revenue is forecast to decline by an annualised 4.6% over the five years through 2014-15, to reach $131.8 million. Furthermore, the rate at which sales are falling is increasing, with revenue forecast to decline by 7.2% in 2014-15 alone.
The industry's major players include a mix of companies that have sold physical CDs and DVDs through traditional bricks and mortar outlets, and companies that established themselves as online-only stores. The latter are likely to be more severely affected by the change in media formats, as they do not have the size, brand name and financial backing to establish IT infrastructure and break into a digital market already dominated by Apple and Spotify. The future for the industry is anything but bright. “With digital downloads and streaming expected to become the dominant methods of accessing media, the popularity of CDs and DVDs is likely to decline,” says Ivanov. Furthermore, improving telecommunication technologies, combined with lower costs, will increase the convenience of streaming music through personal mobile devices. Opportunities still exist for players to focus on niche markets like collectors, to sell rare and unique items, but this market is small and is unlikely to rescue the industry on its own.
The Online CD, DVD and Blu-ray Sales industry exhibits a low level of market share concentration. The industry is highly fragmented outside of these major players, with many smaller players operating in only one segment, offering niche products. While concentration in the industry is low, it is expected to increase over the next five years, as major players refine their online strategies. JB Hi-Fi – the industry's largest player – has only recently increased its focus on online sales, with current growth in online sales greatly outpacing the industry. Other bricks-and-mortar operators are expected to exhibit a similar trend, as online sales benefit from a renowned brand name.
For more information, visit IBISWorld’s Online CD, DVD and Blu-ray Sales industry in Australia report page.
This industry is composed of e-tailers that sell pre-recorded audio CDs, DVDs, Blu-ray Discs, records, tapes and books. Bricks-and-mortar sales of these products are not included in this industry.
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IBISWorld Industry Report Key Topics
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
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Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.