updated 01:45 pm EST, Thu January 24, 2008
IFPI Music Sales in 2007
Direct-download music sales saw one of its most significant increases yet in 2007 but is being "choked" by piracy, says a new report from the IFPI. The international music association notes that sales of music online grew by 40 percent last year to produce about $2.9 billion in sales and was large enough to account for a significant portion of some countries' entire music sales. Internet sales now represent about 15 percent of all music sold in the world and account for 15 percent in the US specifically, according to the IFPI. Single-track downloads comprised a large part of the success and grew by 53 percent to 1.7 billion individual songs.
This success is still undermined by illegal trading, the organization claims. In addition to failing to offset a drop in CD sales, legal sales are also said to have been eclipsed by the "tens of billions" of illegal copies traded online, with as much as a 20-to-1 ratio of illegal to legal songs, the group estimates. The report also contends that US labels alone lost as much as $3.7 billion in revenue due to piracy and that frequent peer-to-peer users buy fewer CDs, though it does not say whether the revenue number accounts for users whose habits would not have changed without the illegal option in place.
The report in turn claims that filtering at the Internet service provider level is the "most effective" way to eliminate piracy and cites a move by the French government to require filtering of illegal material as a positive step, also pointing to similar proposed options in Belgium, Sweden, and the UK. Implementing the technique would remove the temptation to pirate tracks by making the downloads themselves impossible.
"There is only one acceptable moment for ISPs to start taking responsibility for protecting content - and that moment is now," IFPI chair John Kennedy argues.
AT&T is also reportedly considering similar actions for its network traffic in the US but has not received government backing for such a plan, which has received resistance from advocacy groups.