Ian Bell of 7digital, which runs digital media commerce on behalf on record labels, broadcast, retail and brand partners, said the danger is thinking that digital is only 1-2% of digital revenues. “Digital is not 1-2% of music consumers. They are combining their listening habits between CD, downloads, subscriptions and mobile phone content.”

(Ed’s note: Well yes, since most digital music is still pirated MP3 and ripped CDs).

“We constantly get emails from our customers who say, for instance, they can’t a particular download to work or move it between their phone and their PC. But these are a broad cross section, from businessman, to teenagers, to housewives.”

Bell sounded a note caution about the growing enthusiasm in the industry for subscription services.

“There’s still a divide between A&R and interactive, but record companies are grasping digital – it’s just not obvious what the killer solution is now.”

“Our business is being driven by marketing managers in labels saying they want to do digital, and bringing in new revenue streams.”

Bell noted how The Stereophonics recently recorded their last single live every night on tour and made this available as a download in AAC, WMA and MP3.

“They drummed up 5-6000 sales through that. In many cases those sales would not have been made with a physical product. It’s great for their chart position and revenue and giving the fans something different.”