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January 25, 2008 at 10:54:00 AM | more stories by this author
IFPI report indicates that while digital music sales jumped 40 percent in 2007, a continued decline in CD sales pushed the total market down 10 percent.
The major record labels have made strident moves recently away from DRM, the oft-debated technology that restricts legal downloads and, in the eyes of many, has stifled the digital music market.
Why now?
The answer is that the continued decline in music sales has reached a breaking point, a trend laid bare in a new report from the International Federation of the Phonographic Industry (IFPI), the music industry's global trade organization.
Singer Carla Bruni and French President Nicholas Sarkozy.
According to the IFPI report, digital music sales jumped 40 percent in 2007 to $2.9 billion, continuing an upward curve. Digital sales raked in $2.1 billion in 2006, $1.1 billion in 2005, and $380 million in 2004. The group said that digital music sales now account for 15 percent of the global music market, up from 11 percent in 2006.
But declining CD sales pushed the overall market down 10 percent for the year. The IFPI report does not mention the strategic shift by the major record labels toward selling DRM-free digital downloads in an attempt to spur even more digital sales.
Instead, the report focuses on music piracy, noting that "tens of billions" of songs were illegally downloaded in 2007, and that the ratio of unlicensed tracks downloaded to legal tracks sold was about 20 to 1.
The IFPI called on federal governments to intervene to force Internet service providers (ISPs) to help stamp out music piracy occurring on their networks. The group hailed the recent statements by French President Nicholas Sarkozy to focus on ISP regulation. Sarkozy has a newfound connection to the music world in that he is dating singer Carla Bruni.
The group said ISPs should disconnect file swappers and install filters.
"There is only one acceptable moment for ISPs to start taking responsibility for protecting content--and that moment is now," IFPI Chairman and CEO John Kennedy said in a statement. "After years of prevarication in the discussion, the French government's decision to seize the day is deeply refreshing. It shows an urgency of approach that is badly needed in every market where music is today being massively devalued by piracy."
