BPI chairman Tony Wadsworth has warned labels not to cut back investment in new artists.

Addressing the U.K. trade body's annual general meeting at London's May Fair Hotel today (July 8), Wadsworth identified many positives for the biz. U.K. singer Susan Boyle had the biggest selling artist album in the world in 2009, following fellow Brits Coldplay in 2008 and Amy Winehouse in 2007.

Wadsworth also noted that 2009 was the first time in six years that U.K. recorded music trade revenue had increased (by 1.4%). Digital sales are also surging ahead, with digital albums up 56% by volume in 2009.

"There are now 59 legal ways to get music online," said Wadsworth.

Breaking New Artists

While the last decade has seen a major challenge from Internet piracy, Wadsworth said the cost-cutting in the industry must not go too far. "On the whole we are a fitter, more efficient and streamlined industry," said Wadsworth.

But he stressed that "breaking through with new artists is a sign of a healthy industry."

And the former EMI Music U.K. and Ireland CEO/chairman warned: "This streamlining must not go so far as to have a negative effect on one of our most important functions: investing in new artists."

The consequence of not signing and developing new acts would be a "less vibrant music scene, and in turn, fewer successful music companies."

"There may not be as much money to invest as there used to be, but I believe that shouldn't mean that we support fewer artists," he added.

Although Wadsworth welcomed diversification of revenue streams and new commercial partnerships, he said that the release schedule is largely what drives the biz - and that requires the development of new acts. "Let's not go down the route of focusing the investment into fewer and fewer artists," said Wadsworth. "It may serve a short term need to consolidate, but I feel that in the long-run we will live to regret it."

ISPs' Legal Move Disappoints

Wadsworth hailed two achievements where the BPI campaigned on the winning side: the passage of on anti-piracy legislation the Digital Economy Act in April, and the BBC Trust's July 5 decision to reject management proposals to close BBC 6 Music.

He said it was "fantastic" that artists' and fans' voices had been heard during the public consultation on the modern rock and alternative radio station, and pledged that the BPI will "keep a close eye" on developments to ensure 6 Music "gets the long-term commitment it deserves from the BBC." Wadsworth said it was also vital that all BBC radio continued to supported new music.

The BPI also worked hard to persuade MPs to pass the Digital Economy Act. He noted that some of the virulent comments opposing the legislation posted by anti-copyright campaigners online were "enough to make a roadie blush."

Wadsworth said that today's news that Internet Service Providers Talk Talk and BT are seeking judicial review of the Act showed their "true colors" when it came to tackling copyright infringement.

BPI chief executive Geoff Taylor added that the judicial review by the ISPs was no surprise because "those companies have resisted any real means" to tackle file-sharing on their networks.

Google Exec's Licensing 'Nightmare'

The final part of the AGM was an entertaining keynote by Nikesh Arora, Google president global sales operations and business development. Admiring the creativity within the music industry, he arrived on stage by saying he had heard "some of the best heckling in my life" when he was sat at the back of the room.

Arora had to deal with some heckling himself when the subject of Google searches bringing up copyright infringing links came up. "We try our best under the current legal system to follow the law," he said.

He also pledged to look into the process of takedown notices sent to Google by copyright holders. "Geoff [Taylor] and I have been talking about takedown notices and how fast we need to respond," he said.

Taylor also pressed Arora on searches bringing up legal services higher, and the Google exec appeared to accept the proposal that the U.K. industry's Music Matters online portal could at some stage act as a certification tool for Google searches on legitimate sites.

Asked about the likely launch of a Google music service, Arora did not give any clues about the nature of Google's offering or a launch date. But he said that "designing the service is not the hard part," rather it was the "nightmare" of trying to license music on a global basis.

The following major label representatives were elected to the BPI Council: Ged Doherty, Sony Music U.K. chairman and CEO; Rachel Evers, SVP business affairs at Warner Music U.K.; Jeremy Marsh, vice chairman of Warner Bros. Records U.K.; Emma Pike, Sony Music U.K. VP communications and artist relations; and Andria Vidler, president EMI Music U.K. and Ireland.

Two independent label representatives were elected: Adrian Sear, commercial director at Demon Music Group/2entertain and Peter Stack, managing director of Union Square Music.