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Apple iTunes Usage Grows 69% Over Past Year - US Broadband Penetration Climbs to 77.7% Among Active Internet Users - December 2006 Bandwidth Report

Summary: iTunes users grew by nearly 69% over the past year, but by only 26% since January. Among the big four streaming media players, only RealPlayer showed significant growth compared to Apple since the beginning of 2006.

Users of Apple's iTunes player grew by nearly 69% over the past year (see Figure 1), but by only 26% since January. Among the big four streaming media players, only RealPlayer showed significant growth compared to Apple since the beginning of 2006. Broadband growth continued its steady climb in November, growing by 1.1% percentage points to 77.7% among active Internet users.

streaming media players growth itunes, realmedia, quicktime, and windows media

Figure 1: Streaming Media Player Growth
Source: Nielsen//NetRatings and Website Optimization

iTunes Player Usage Grows Nearly 69%

Over the past year, the number of unique users of Apple's iTunes player grew by 68.5%. Over the same time period, RealPlayer grew by 16.4%, QuickTime by 7.6%, and Windows Media Player grew by 4.3% according to data provided by Nielsen//NetRatings. However, from January 2006 to November 2006 iTunes users grew by only 26.3%, while RealPlayer grew by 6.6%, and QuickTime and Windows Media Player were essentially flat (see Table 1). Note that in Figure 1 we used November 2005 data instead of the January 2006 data to smooth out the data points.

There were disputed reports of a slowing in iTunes growth recently. While iTunes' yearly growth rate has actually increased to nearly 70%, from January to November 2006 iTunes usage grew by only 26.3%. It appears that the December holiday rush plays a critical role in yearly growth. We'll revisit the streaming media landscape once the Janauary 2007 figures are available.

Table 1: Streaming Media Player Growth Comparison (Unique Audience [000])
Player Nov-05Jan-06Nov-06YOYJan-Nov
Apple QuickTime11,77112,81712,6707.6%-1.1%
iTunes13,92218,56823,46068.5%26.3%
RealPlayer26,26228,68730,56616.4%6.6%
Windows Media Player68,75871,11271,7054.3%0.8%
Source: Nielsen//NetRatings

Home Connectivity in the US

US broadband penetration among active Internet users grew to 77.68% in November 2006. Narrowband users connecting at 56Kbps or less now comprise 22.32% of active Internet users, down 1.08 percentage points from 23.4% in October 2006 (see Figure 2).

Web Connection Speed Trends - Home Users (US)

Web Connection Speed Trends November 2006 - U.S. home users

Figure 2: Web Connection Speed Trends - Home Users (US)
Source: Nielsen//NetRatings

Broadband Growth Trends in the US

In November 2006, broadband penetration in US homes grew 1.08 percentage points to 77.68%, up from 76.6% in October. This increase of 1.08 points is near the average increase in broadband of 1.03 points per month over the last six months (see Figure 3). At current growth rates US broadband penetration should break 80% among active Internet users by mid-January 2006.

Broadband Adoption Growth Trend - Home Users (US)

Broadband Adoption Growth Trend - November 2006 - U.S. home users

Figure 3. Broadband Adoption Growth Trend - Home Users (US)
Extrapolated from Nielsen//NetRatings data

Work Connectivity

As of November 2006, 92.5% of US workers were on broadband, up 0.79 percentage points from the 91.71% share in October. At work 7.5% connect at 56Kbps or less (see Figure 3).

Web Connection Speed Trends - Work Users (US)

Web Connection Speed Trends - November 2006 - U.S. work users

Figure 4: Web Connection Speed Trends - Work Users (US)
Source: Nielsen//NetRatings

Further Reading

Conflicting Reports on iTunes Sales Declines
A New York Times story published recently cited a report from Forrester Research analyst Josh Bernoff, which inferred that since the ratio of iTunes songs sold per iPod sold has been steadily rising, a disconnect could be occurring between the two products in a changing portable media market. BetaNews, Dec. 13, 2006.
Gloomy iTunes Predictions Premature
A New York Times followup to their initial iTunes slow growth story. The imminent demise of iTunes appears to have been somewhat exaggerated. New York Times, Dec. 13, 2006.
Nielsen//NetRatings
Provided the streaming media player data and US broadband penetration data for active Internet users for the Bandwidth Report.
Sales of iPods and iTunes Not Much in Sync
Based on a recent survey the numbers suggest that iPods are not driving iTunes sales as much as early supporters may have expected. New York Times, Dec. 11, 2006.

By website optimization on 15 Dec 2006 AM

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