IFPI estimates pirated business at $4.6 billion.

A total of 1.2 billion pirate music discs were sold in 2004, accounting for 34% of all discs sold worldwide, according to a report unveiled today (June 23) by the International Federation of the Phonographic Industry.

The IFPI's Commercial Piracy Report 2005 reveals that the global pirate business is valued at $4.6 billion, and has remained flat compared to 2003.

The IFPI reports that with only a 2% rise in units in 2004, the level of growth is at it slowest in five years. Legitimate discs still account for twice the number of pirated discs in 2000.

The IFPI said that anti-piracy enforcement efforts helped last year in the de-commissioning of 87 CD production lines -- up from 68 in 2003 -- and the seizure of 28,350 CD burners, double the level of the previous year.

IFPI head of enforcement Iain Grant attributes this achievement to a step-up in enforcement efforts in such countries as Mexico, Brazil, Hong Kong, Paraguay and Spain. "We are encouraged by the number of seizures," he tells Billboard.biz. "But there's still more to do."

Grant adds, "We see increasing action from governments and there's a growing awareness about the effects of piracy."

However, he notes that there is still a grim picture painted in many of the world's markets. Pirate sales outnumber legitimate sales in 31 countries, including Chile, Czech Republic, Greece, India and Turkey.

The IFPI again singled out ten countries that require priority action and where government intervention is urgently needed. The top 10 list includes Brazil, China, India, Indonesia, Mexico, Pakistan, Paraguay, Russia, Spain and Ukraine. Taiwan and Thailand have been removed from last year's list while India and Indonesia have been added.

Grant adds that there are some countries that are not in the list that had shown anti-piracy improvements in recent years but had begun to soften their approach. "Bulgaria is a concern," he says. "It was a real black spot some six years ago, then it turned the corner and started improving. But we now see signs that they relaxing their attention."

IFPI chairman/CEO John Kennedy called for more government action at all levels. For the IFPI, only proper copyright protection legislation, active enforcement and deterrent penalties can have an impact on piracy.

"The music industry fights piracy because if it did not the music industry would quite simply not exist. Billions of dollars of investment go into releasing and marketing over 100,000 albums in a single year, and this is only possible when there is good, effective enforcement of copyright," Kennedy said.