The Australian music industry is growing and developing yet specific information about the ways in which distribution systems develop is limited. In this study I examined the growth and change of the Australian music value chain. This includes the development of digital distribution systems and the effect that peer-to-peer technology has on system development, specifically the disintermediation between consumers and artists to the detriment of the multinational value chains. The drivers of this change are broken into social and technical elements in order to describe the growth and change occurring. The method used included a comprehensive literature review and use of secondary data from key music industry associations. The Australian music industry is a subset of the global industry and is led by foreign markets and their methods in which music content moves from the creators to the consumers. The consumption patterns of Australian music consumers are changing. The overall value of the music industry is dropping as the new digital downloads market emerges and the overall volume of sales increases; this reflects similar trends in foreign markets. CD single sales have dropped and digital single sales (in MP3 format) have increased. However, there needs to be a balance in the future development of Australian music distribution systems between the needs of music consumers and the sustainability of music companies, where there is both connectivity and steady revenue flow. There are technical elements that have caused a movement away from the traditional forms of music distribution as new technologies facilitate the change, such as Apple's iPod and broadband Internet connections. Advancement of distribution systems has increased piracy levels and the response has been the implementation of digital rights management (DRM), which prevents connectivity. There are also social elements that affect growth and change such as connectivity, or the consumers freedom to choose when, where and how to listen to their music. When music product has a restriction placed upon it its value to the consumer drops. Multinational music companies have failed to recognise the value users place on the freedom to pick and choose and have tried to control rather than to co-develop systems that meets both parties needs.