Napster veterans buy fewer CDs

Napster users make fewer music purchases the more they download music online, according to a study released on the same day that the file swapping site agreed a new business model with German giant, Bertelsmann.

Although users of the service initially purchase music online at the same rate as non-Napster users, their purchases tumble a short time later.

According to the latest US sales tracking information from PC Data, Napster users buy fewer CDs about 90 days after downloading the file sharing software. However, they visit online music retailers more frequently than non-Napster users.

The data showed that one month prior to using Napster, 10.4 per cent of the 120,000 consumers tracked for the survey visited online retailer CDNow.com, and 8.3 per cent made purchases.

A month after using Napster, 25.6 per cent visited the retailer and 8.4 per cent continued buying, but after the third month, CDNow.com was visited by 20 per cent of the Napster users tracked, with only 5.7 per cent making purchases.

Ann Stephens, chief executive at PC Data, said: "Apparently Napster users visit online retailers to get information about music, and then use Napster to download the music free of charge. Portable MP3 players and recordable CDRoms are simply too easy and too cost efficient not to use."

PC Data predicts that two million standalone CD-RW drives and 3.5 million PCs with integrated CD-RW drives will be sold this year. The drives are frequently used to burn music CDs.

The research company also calculated that Napster's user base has more than doubled over the past six months to reach 18.7 million, and that more than 40 per cent of its users are between 12 and 24 years of age.

Napster yesterday agreed to begin charging users for its service as part of a wide ranging agreement with Bertelsmann. In return, Bertelsmann will allow Napster users to download its music catalogue, and will drop its lawsuit against the file swapping site.