London (England) - Consumers spent a reported $2.9 billion on digital music purchases last year, a 40% increase over 2006, but illegal downloads are offsetting that by a rate of 20-to-1.

The outdatedly titled International Federation of the Phonographic Industry (IFPI) said that last year set a new record for the digital music industry.  However, the steep decline in CD sales and growth in piracy are bigger players in the fate of the music industry overall.

The IFPI said the increase in legal digital music purchases are still pretty pitiful in comparison to the billions of dollars lost from illegal downloads.  In fact, the group, said, for every one track that is purchased legitimately, there are another 20 that were downloaded illegally.

In its report, the IFPI mentioned French president Nicholas Sarkozy's proposal to automatically disconnect French residents involved in piracy.  It's "the most significant milestone yet in the task of curbing piracy on the Internet," said the head of the IFPI John Kennedy.

Additionally, the IFPI noted that although there was a year-to-year increase, it paled in comparison to previous years.  For example, digital music sales nearly tripled between 2004 and 2005, and then doubled from 2005 and 2006.  However, there was only a 40% increase from 2006 to 2007.

 

law of diminishing returs anyone?

Jan 24, 2008 13:29     

2004>2005 x3 2005>2006 x2 2006>2007 x1.4 2.9/1.4=2.1 2.9/1.4/2=1.0 2.9/1.4/2/3=0.3 so 2004 : 300.000.000$ 2005 : 700.000.000$ 2006 : 1100.000.000$ 2007 : 800.000.000$ so their growth actually only diminished by about 300.000.000$, or 30% - they still grew though, dispite an economic recession
ikkeman report abuse vote down vote up Votes: +0

How in the world they can count "illegal down"???

Jan 24, 2008 17:26     

Does it mean as all music belong to IFPI???? There a lot of "homemade" tracks as well. How they identify if files legal or not? Sounds like a week later there will be another topic showing this data fudged... I like French president proposal! If I got invited in somebody's home and will download something using theirs Internet conenction they will be disconnected from Internet!! Cool!! In one year there will be no internet in France!! Way to go France!

wow report abuse vote down vote up Votes: +0

All Downloads Illegal?

Jan 25, 2008 11:21     

Does it count legal downloads of music as illegal? One can buy music to download yet they imply that too is illegal. Is it legal only if one buys the cd? How did they count the illegal downloads?
TomLeeM/BigWarpGuy report abuse vote down vote up Votes: +0