Legit downloads soar in U.S., Europe.

The international recorded music industry today (Jan. 19) outlined the crucial gains it has made in the battle against digital piracy.

While unveiling its new "Digital Music Report" in London, the IFPI confirmed that revenues from digital sales in 2004 rose to $330 million, a figure that is expected to double this year. Based on predictions by such research companies as Jupiter Media, the report says digital music will account for up to 25% of total global music sales in five years' time.

"A sector that currently 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 an opportunity," says IFPI chairman/CEO John Kennedy.

In its report, the IFPI attributes digital growth in part to the industry's lawsuits against illegitimate online services and serial illegal downloaders. The 7,000-plus lawsuits instigated in North America and Europe last year were found to have helped educate consumers that unauthorized downloads are illegal, the IFPI says.

"Anti-piracy enforcement is a critical part of the recording industry's digital strategy. And it has proved an effective one too," Kennedy says.

The number of online music retailers in 2004 rose to more than 230 globally, of which 150 were in Europe. In 2003, there were only 50 online music retailers.

Also in 2004, the number of songs legitimately downloaded in the United States and Europe soared ten-fold from the previous year to more than 200 million. In the States, consumers bought 140 million downloads during the year, vs. 20 million in 2003.

Additionally, an estimated 20 million-25 million portable music players were sold worldwide during the year.

The report also analyzes the burgeoning mobile music sector. It predicts that further growth in sales of ringtones, mobile downloads and ringback tunes will be spurred by the expanding reach of high-speed, third-generation handsets and networks.

Crucial developments anticipated in 2005 include ventures designed to commercialize peer-to-peer file-sharing technology, such as Snocap and Mashboxx.

The report also warns that piracy will continue to plague the music market. To counter this, the industry has scheduled more litigation for 2005.