In-Stat Predicts Ramping Digital; Modest Top-Line Increases

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The days of heady, over-the-top digital music sales projections disappeared long ago.

But when will this sector start making serious money?

One answer is never, at least in volumes substantial enough to support a recording industry in the classic sense.  In fact, massive file-sharing volumes have steadily driven the price of recorded music towards zero, especially alongside sinking physical purchases.

On Tuesday, In-Stat offered a more optimistic assessment, one sprinkled with reasonable levels of caution.  The Scottsdale, Arizona-based group predicted that global, top-line recording industry revenues would reach $37 billion by 2012.  Of that total, In-Stat projected that 40 percent ($14.8 billion) would come from digital formats.

That represents a boost from a year-2007 estimate of $30.5 billion, and a digital contribution of 10 percent.  Sounds reasonable enough, though plunging physical sales raise questions on the upward direction of the forecast.  And whether mobile-based revenues will offer a life raft also remains speculative, though In-Stat predicted mobile-based, full-track revenues of $4.2 billion, measured globally.