The French biz was down 15% to €606 million ($794.9 million) based on wholesale market figures in 2008, trade label body Snep revealed during the MIDEM international music market and conference in Cannes.

The physical market dropped 19.9% to €530 million ($695.2 million), losing €132 million ($173.2 million), while there was only a €25 million ($32.8 million) gain in digital revenue.

Overall, the digital market in France amounted to €76 million ($99.7 million), out of which €35 million ($45.9 million), representing 46% of revenue, came from mobile (excluding mobile subscription revenue). Another €24 million ($31.5 million), 32% of digital revenue, was from Internet a la carte downloads and €17 million ($22.3 million), 22% of revenue, was from streaming and subscription-based revenue (both from the internet and mobile).

For the first time, retail sales went below €1 billion ($1.31 billion), to €983 million ($1.29 billion).

Snep director general Hervé Rony expressed his concern about the acceleration of the decrease in record sales from supermarkets - down 6% in 2008. They represented 49% of the market sales in 2003, but accounted for 34% last year.

Local repertoire (excluding classical music) went down faster than foreign music, losing 21% against 16% for the international repertoire. The local repertoire now represents 57.4% of the French market (excluding classical).

For the first time since CD sales started to decline, the French majors signed less new recording contracts (69) than they canceled or avoided to renew (84).

While still the fifth market globally, France lost market share in the world, now representing 5.6% of the global market.

Despite these bad figures, Snep still found some signs of hope. President of Universal France Pascal Nègre noted that the French market was down only 1% in December, compared to December 2008.

"CD is a good gift in a context of economic crisis," he said: "It is cheap and you can choose it in accordance with the person you're offering it to."

But the industry's main hopes are geared towards the Creation and Internet law, currently in adoption process in France, which is designed to reduce online piracy.

French minister of Culture Christine Albanel said during MIDEM that she was doing everything possible to have the law voted through by the end of February.

Christophe Lameignère, CEO of Sony Music France and president of Snep, also announced that the trade body was working with French media watchdog CSA to soften rules on product placement and on music sponsorship on TV.

French authors society Sacem and French performers society Adami raised the idea of taxing ISPs to create new revenue streams for the music industry, during the conference. Snep said they would not consider the idea "for the moment."

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