BUSINESS
Music downloads top 200m in 2004
20-01-2005
by Charlie Taylor
Music fans in the US and Europe downloaded more than 200 million tracks from legitimate online music sites in 2004, up from 20 million a year ago.
A new report issued by the International Federation of the Phonographic Industry (IFPI), which represents more than 1,450 record companies around the world, found that the number of legal music websites quadrupled over the year from 50 in 2003 to over 230 in 2004.
During the same period, the supply of music files on unlicensed P2P services fell. According to the IFPI, the total number of infringing music files on the internet in January 2005 is slightly down on one year ago at 870 million tracks despite a rise in the number of broadband connections around the globe.
The report suggests that consumer attitudes towards digital music are changing with a recent survey in six European countries (Denmark, France, Germany, Italy, Austria and the UK) showing that nearly one in three music downloaders intend to buy from legal music services in the coming months, a rise of 9 percent on the preceding year.
The change in consumer attitudes is attributed in part to the music industry's international campaign to help promote the legal download market. This resulted in a concerted drive to direct fans to legitimate music sites in over 30 countries. Also cited as contributing factors is the increasing popularity of portable music players such as the iPod and of mobile phones, which are credited with transforming consumers' experience of enjoying music.
According to the IFPI, digital piracy remains a very significant problem, but the recording industry's campaign of legal actions against music uploaders is helping to contain it.
"The biggest challenge for the digital music business has always been to make music easier to buy than to steal," said John Kennedy, IFPI chairman and CEO. "At the start of 2005, as the legitimate digital music business moves into the mainstream of consumer life, that ambition is turning into reality."
"The record industry's priority now is to licence music -- to as many services, for as many consumers, on as many formats and devices for use in as many places and countries as it can," added Kennedy. "The straightforward conditions are that the business must be legitimate, the music must be correctly licensed, and record companies and other rights holders must get properly paid."
As reported by ElectricNews.Net recently, digital downloads contributed to a 1.6 percent growth in music purchases in the US last year, the first increase in sales in four years. At present, revenues from digital music account for a fraction of overall music revenues but the IFPI expects that to change over the coming years.
"I am confident that in twelve months' time the digital music market will have grown very significantly around the world. A sector that now accounts for a very small percentage of the industry's revenues is poised for take-off in the next few years. At long last the threat has become the opportunity," added Kennedy.
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