Global revenue from digital sales and services grew by just 6% in 2010 - half the growth rate from the previous year - and the overall recorded music market shrank by between 8-9% in total trade value (both physical and digital), according to a new report published by international music organization IFPI.
According to the IFPI Digital Music Report, which was released in London today, the total trade value of the global digital music market in 2010 amounted to $4.6 billion and accounted for 29% of record companies' total income. Comparative figures for 2009 were not provided.
Other findings published in the report included:
-- An estimated 77% fall in debut album unit sales in the Top 50 from 2003 to 2010.
-- A 12% fall in the revenues of the global top 50 tours in 2010.
-- A 17% fall in the number of people employed as musicians in the U.S. from 1999-2009
-- 1.2 million jobs are projected to be lost in the European creative industries by 2015 due to piracy.
-- On a lighter note, Ke$ha scored the best selling global digital single in 2010 with "Tik-Tok," which moved 12.8 million units. Lady Gaga was second with "Bad Romance," with 9.7 million units, and Eminem and Rihanna's "Love the Way You Lie" was third with 9.3 million.
Speaking at the report launch, IFPI chief executive Frances Moore likened piracy to a plague, which impacts on every area of the music industry.
"The industry remains tremendously challenged by piracy," said Moore, at the London launch. "However, we believe there is cause for optimism and governments are starting to wake up to the problems we are facing and do something about it."
According to the IFPI Digital Music Report, approximately 95% of all global downloads in 2010 were via illegal services, including P2P, with a high proportion of copyright infringing content made up of music. That figure is consistent with the past several years, the report says.
Moore identified already implemented legislation in France and South Korea, where laws have been passed to combat piracy. Anti-piracy legislation has also recently been tabled in Chile, New Zealand and Malaysia, she went on to say.
"This challenging environment continues, but we have some cause for optimism going forward into 2011," Moore continued. "That comes from that a combination of government action, help from ISPs and new legal services."
Commenting on the report's findings, Max Hole, COO of Universal Music Group International, said: "We live in a time of incredible opportunity, but also a time of grave danger from the threat of theft and piracy.
"We must all work together - governments, ISPs and the creative industries - to protect music and new talent," said Hole, who also expressed his frustration at ISPs in international markets who have been critical of government enforced anti-piracy legislation.
"The ISPs are a considerable challenge because the ISPs, to a degree, have gotten fat on access to our content and all the creative industries' content, for which we are not being paid," he continued, going on to say that labels would need to form partnerships with both ISPs and international governments to combat piracy, as well as increasing the number of global digital music licenses on offer to consumers. At present there are just over 400 licensed digital services available globally, with a repertoire of over 13 million tracks, according to IFPI.
"We feel that while this is a very serious task, we're [now] starting to roll," Hole said, with cautious optimism. "It's been difficult getting it from stationary to movement, but it's now starting to move slowly," he continued, citing France, where HADOPI legislation has been introduced to combat illegal file-sharing, Ireland and South Korea as markets where government-enforced anti-piracy legislation is beginning to make a positive impact.