There appears to be a significant divide between teenagers and adults as to their choices of music services.
According to a recent survey conducted by Nielsen Co, nearly two-thirds of U.S. teenagers under the age of 18 say they use Youtube, more than any other medium, to listen to music.
In addition to treating YouTube as a de facto free music service, young people said they are less inclined than those 18 years old and up to listen to CDs or the radio.
Neither age group reported making much use of Spotify AB, Rhapsody International Inc. or other on-demand streaming music services, though Pandora Media Inc.’s custom online radio service was among the five most-popular methods for both groups.
Among adults, the most popular ways to listen to music were radio (67%), CDs (61%), YouTube (44%), Pandora’s custom-radio service (32%) and Apple Inc.’s iTunes (29%).
Among 13-to-17 year olds, YouTube was the most popular way to listen to music, with 64% using it. Radio was next, with 56%, followed by iTunes (53%), CDs (50%) and Pandora (35%).
This all translates to the many challenges facing record companies as they continue to transition into the digital world.
There is very little revenue to be realized for the record companies from a Youtube stream.
Record companies and music publishers typically realize some revenue from advertising that appears with their videos on YouTube. But it is only fractions of a cent per play.
The YouTube app on Apple’s iPhone, iPad and iPod Touch runs no advertising, meaning it generates no revenue for record companies. Although, Apple recently said it would do away with the app.
The massive popularity of YouTube, show that record companies will need to stay nimble in the ever changing world of music monetization.