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Is Apple to blame for the High Street's struggles?

Ashleigh Allsopp | Feb. 18, 2013
The recent failure of retailers such as HMV, Jessops, Blockbuster, Game, Comet and Play.com, and reports suggesting that 600 shops closed last year, have raised the question about what's to blame for the high street's struggles. Apple on the other hand is seeing huge success. What is Apple doing right? And is its success to blame for the failures of others?

But Apple isn't the only company encouraging digital downloads. Amazon offers MP3 downloads, and has recently rolled out an MP3 store for iPhone and iPad, and personalised music streaming services such as Spotify are also becoming an increasingly popular alternative to buying CDs.

According to the UK music industry trade body BPI, almost one in five (19.6 per cent) of music buyers now buy only digital music, ditching the high street all together in what's been described as the "digital music switchover," reports the Guardian.

"There has rightly been a lot of focus in the past few weeks on high street music retail. That will continue - we must do all we can to serve music fans who love CDs and vinyl," said BPI chief executive Geoff Taylor.

"But as well as great music stores, Britain is blessed with a world-beating array of digital music services, which fans rate very highly for ease of use and value for money. And this is just the beginning," he added.

BPI says that services such as Spotify, Napster and last.fm are contributing to the rise in streaming music, a market which is now worth more than £49 million annually to British record labels, accounting for 15.2 per cent of digital income.

In total, UK customers streamed more than 3.7 billion songs in 2012. We also bought approximately 30.5 million digital albums and 183.3 digital singles, says BPI.

"The change has been seismic. And it continues," said Taylor. "Market growth and digital innovation are dynamically intertwined, meaning the next 10 years should be equally as game changing and thrilling, as we look forward to the impact of 4G-connected TVs and in-car streaming on the horizon."

Digital downloads span further than just music too, of course. iTunes offers digital downloads of television shows, films and books, while Amazon also has its Kindle products. Catch-up services and other services like Netflix and Love Film mean customers don't need to leave their houses when they fancy watching a new movie.

NPD Group has ranked iTunes as the top 'Internet Video On Demand' provider, (which doesn't include the streaming services such as Netflix), reporting that Apple provides approximately 45 per cent of online video rentals. Amazon is estimated to account for around 18 per cent of online video rentals through its Instant Video service, placing it in a distant second place.

These factors, plus the ability to download Xbox and PlayStation games straight from the console and the advancements in mobile gaming, mean HMV, Blockbuster, Game and Play.com, all examples of retailers who offer DVDs and games in physical copies, are facing fierce competition from an area that is growing rapidly.

 

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