Some online music services may not be able to break even because people expect to pay much less for a digital album than a physical CD.
The study by global research firm Ipsos-Insight has found that American Internet users aged 12 and older would accept paying between $9.99 to $14.99 for a physical CD, but would only pay between $5 and $9.99 for a full-length album download.
Director of research at Ipsos-Insight Matt Kleinschmit said: "A roughly $5 decrease in the range of acceptable prices for a new, full-length album distributed digitally versus in a physical format represents a significant decrease in perceived value for this product based solely on format or distribution method."
A report on Forbes.com suggests that competition amongst music download services will force prices down to a point where some services will not be able to survive. Since "no one is making money by selling music online," the report suggests that this will "bring the breakeven point for these services under attack".
"That will turn the music download business into a struggle for market share, and the chief weapon will be what it has always been: special promotional prices, giveaways and profit-sapping deals, which can't help but extend the time it takes these services to achieve profitability. That means a shakeout is coming. And by this time next year, its results, and the victors, will be apparent," the report concludes.
Downloading an album on Apple's iTunes Music Store currently costs $9.90.