By Richard Menta 4/15/05
MP3 player sales are reaching a point of penetration into US household that will soon propel it from toy for the technically inclined to everyday mundane home item. This is no surprise as digital devices are destined to replace the aging cassette format. What is notable about the comment is that very soon MP3 adoption will be saturated enough to spur significant growth in services and products to cater to owners.
"Historically, any new device or medium that reaches a U.S. household penetration of 15 percent to 20 percent creates a critical mass of customers for other products and services," JupiterResearch analyst David Card said. "MP3 players will hit that mark this year".
We have already seen this effect in action with the Apple iPod, a product that has created its own cottage industry of add-ons, peripherals and services. Yesterday's announcement by Apple that it sold a record 5.32 million iPods last quarter is already stimulating rosy forcasts for iTunes and the iPod options crowd.
The proliferation of iPod competitors will expand those products and services not necessarily tied to the iPod like Napster. Worldwide the iPod is not yet available in all markets and so various Korean and Japanese makes dominate here. According to research firm In-Stat worldwide sales of digital portables will more than double this year and reach the $1 billion sales point for the first time.
As for the US, the recent release of the Sony PSP game and media unit has already put a digital movie and music player into half-a-million new hands. Sony expects the PSP to feed their Sony Connect service, their iTunes competitor.
Over the medium term Jupiter expects the iPod to continue its dominance.
The iPod Shuffle is available on Amazon
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Fear of Change Endemic to Early Media
File Sharing Revolutionaries or Cheapskates?
MP3 Frees the Music of Fiona Apple