The paid-for music downloading market in Western Europe has been languishing behind the US — until now. The market will finally take off in 2004, when major players such as Apple’s iTunes, Sony Connect, and Napster enter selected territories. Over the next five years, download services will expand into other European countries, and the market will grow to over 3.5 billion euros by 2009.

¿After years of illegal activity and uncertainty around when major legitimate music downloading services would finally reach Europe, 2004 is proving to be a watershed year,¿ says Forrester Senior Analyst Rebecca Jennings. ¿Consumers are gradually coming around to the idea that paying for downloads gets them quality, reliable music, and services will become easier to use as broadband penetration increases.¿

Young consumers — those aged 16 to 24 — make up the bulk of downloaders today: 49% have downloaded music online, compared with 23% of older Net consumers. However, Forrester sees that older consumers are slowly getting into the habit, as services expand their offerings and become simpler to use.

The UK, France, and Germany will control the bulk of the market — over 60% of legal downloads in Europe will be sold in these three countries in 2009. Southern Europe’s (Spain and Italy) adoption will grow strongly to account for around 20% of the market by 2009. The growth of legitimate downloads is related to the forces of supply and demand operating within each local market. The availability of legitimate services, higher consumer demand due to significant consumer online experience, growing broadband penetration, and the sheer number of consumers are key contributing factors, according to Forrester.

¿Many services will launch first — or solely — in the UK, France, and Germany, due to their size and therefore their linked revenue potential,¿ Jennings adds. ¿Although the Netherlands and Sweden are among those with the highest broadband penetration — and therefore consumers are more likely to download — they also have the smallest populations, and are therefore less attractive commercially.¿

The growth of legitimate music downloads will fire activity into other types of media downloads across a variety of devices. Forrester expects that the next five years will see a large number of organizations — representing not only music-related companies, but also high-street stores and non-music brands — jumping on the bandwagon and offering paid-for downloads, although many services will be financially unsustainable over time.

Giving away music tracks as marketing gimmicks will explode and — as home broadband penetration grows in Europe — video downloads will be next. Consumers will be swamped with offers of free promotional downloads, both from these new services and from marketers who see free downloads as an attractive enticement. Service providers in this space can expect a consumer backlash eventually, though — when consumers sees music (or video) being downloaded to their phones or PC as a marketing tool without their consent, they will soon scream ¿Enough!¿