Global sales of digital music players, including MP3 players and other devices, are expected to increase more than 200 percent by 2009, a key research firm said Thursday, as more consumers adapt to a world where CDs and cassette tapes appear to be going the way of the 8-track tape.

Sales of portable compressed audio players are expected to hit $145.4 billion in four years, a 211 percent jump over $46.7 billion in sales in 2004, according to IDC forecasts. Units shipped worldwide are seen rising 320 percent to 945.5 million in the same period.

“Demand for portable MP3 players is booming, as more and more consumers get acquainted with their stylish form factors and digital audio functionality,” said IDC analyst Susan Kevorkian, program manager for audio consumer markets.

Flash memory-based units will lead the growth, soaring 370 percent to 124 million units in 2009 from 26.4 million units shipped globally in 2004. Video support and the increase of video content will also drive demand.

Digital Boom

And player-only units won’t be the sole beneficiaries from the digital boom. Music-enabled phones, gaming devices, and DVD players that support compressed audio will also gain popularity. The market for these devices is expected to reach $114 billion in sales on more than 700 million units by 2009.

The report comes the day after Apple showed off its long-speculated video iPod (see Apple Unveils Video iPod). Analysts say that the latest gadget could help represent a shift in how consumers obtain, distribute, and play media. IDC’s findings show that increasingly more people are interested in digital content.

Apple Unveils Video iPod

Through its iTunes Music Store, Apple will peddle episodes from TV series such as ABC’s Desperate Housewives and short films in addition to music videos.

Desperate Housewives

“The way Apple is approaching it is very smart,” Ms. Kevorkian said. “They’re able to leverage the popularity of their players… and experiment with non-music video content.”

Analyst Mark Stahlman of Caris & Company said he doubts the video iPod will be used for movies.

“[Videos] are where the world is heading,” Mr. Stahlman said.

IDC divides the MP3 market into four categories: Portable flash-based players; portable hard- drive-based jukebox players; portable players that support MP3 CDs and mini discs; and an “other” category comprised of music phones, portable DVD players, gaming devices, and other gadgets that support compressed files.

IDC said that video support for music video playback will drive demand for both Flash and hard-drive-based portable players. The company also expects more music video download services will crop up.

Changing Landscape

Flash player capacity is expected to increase from 1 GB in 2004 to 8 GB in 2006 and 16 GB by 2007. Apple’s Flash-based player, the iPod nano, released in September, comes in 2 GB and 4 GB versions.

Hard-drive-based players are expected to grow at a worldwide compound rate of 21.5 percent, though average selling prices of more than $200 will keep the market from growing faster.

There are other obstacles to more rapid growth.

Ms. Kevorkian said the portable multimedia market has been stymied by lack of content. But it’s also been hurt because the program which most MP3 players are based on, Microsoft’s Windows Media Player, was designed to be used on PCs.

“We think it will be important for device manufacturers to make it easy to transfer content” from portable devices as well as PCs, she said.

As the delivery of music content changes, Apple has emerged as a clear leader in both the devices and downloading of content. Indeed, some observers see the MP3 market divided into two camps—Apple vs. the rest of the Windows-based universe.

Microsoft launched its “Place For Sure” campaign a year ago, in which partners like Napster and Rhapsody agreed to make content available on players made by all manufacturers. Apple, on the other hand, only allows iTunes downloads on computers or iPods.

launched its “Place For Sure” campaign a year ago, in which partners like Napster and Rhapsody agreed to make content available on players made by all manufacturers. Apple, on the other hand, only allows iTunes downloads on computers or iPods.

But subscription-based services that rival iTunes require consumers to keep paying their monthly fees, or else they won’t be able to access the music they’d already downloaded.

Nevertheless, Apple can hardly afford to get complacent. Others are looking to take advantage of the growing market. Dell and Gateway—computer companies like Apple—have offered players for a few years. Meanwhile, electronics companies are determined to steal share from Apple, which controls about 75 percent of the player market.

Dell

“There’s a cluster of companies like Creative Technologies, which was around before Apple [got into the business], Samsung, and iRiver that are digging in their heels to become competitive,” Ms. Kevorkian said.