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On the face of it, 99¢ per track low-rez music downloads don't seem like a good deal. For the same price, or maybe even less, you can get an entire CD of the same music, along with a booklet, and without the Digital Rights Management crippleware that hobbles paid downloads.

The music-buying public apparently thinks otherwise. You can't beat the "I want it now!" convenience, and with the ability to cherry-pick only the "good" songs off an album, the pricing seems to add up. You might be thinking, "Kids these days don't know about quality sound any more, and are going to ruin it for the rest of us." But the real story isn't that simple.

Research firm Ipsos-Insight is finding that American consumers continue to experiment with fee-based online digital music services and download stores in record numbers. By December of 2004, nearly half (47%) of American downloaders aged 12 and older had paid a fee to download music or MP3 files off the Internet.

These recent findings reflect a leap in activity, which is now roughly double the 22% witnessed in December 2003, and over five times the activity in December 2002. This most recent figure translates into roughly 24 million people within the current US population.

Ipsos-Insight's Matt Kleinschmit notes, "Over the past year, the online music market has proved that it is growing into a formidable music distribution channel marked by rapid growth and increasingly dynamic usage levels." He adds, "While fiercely competitive online music services and download stores undertake high-profile efforts to attract consumers to their respective sites and business models, it is clear from these data that consumers are increasingly experimenting with legitimate online methods of music acquisition."

It gets more interesting when you look at who the new paying downloaders are: Ipsos-Insight reports that adult downloaders aged 25 to 54 are the most likely to have paid to download digital music (50% among 25–34 year-olds, 53% among 35–54 year-olds!). And while younger downloaders have typically been less likely to report having paid for digital music, in the most recent findings, over half of downloaders aged 12–17 report that they have paid for digital music (52%).

Older music buyers clearly like the convenience, and are moving to the computer/portable platform for more of their music. Kleinschmit says, "These data reinforce how unpredictable this emerging market is. Who would have thought two years ago that the initial growth of fee-based digital music would be driven be Americans ages 25–54? What's even more encouraging is that we now see signs that teens are beginning to experiment with fee-based services as well, which shadows recent reports of strong sales of pre-paid cards for high-profile online music download stores.

"This marks a potential turning point in the evolution of digital music. This is significant both functionally and symbolically, as operators of fee-based digital music websites are finally seeing American downloaders embrace their services, and the broader industry can now see empirical evidence that fee-based online content can survive and even flourish while non-licensed content remains available. This was thought to be impossible only a few years ago."