NEWS The music industry will remain flat for another two years – and when it does pick up, the music industry will have the crackdown on file-sharers to thank, according to a report.
The study, The Global Music Industry, from Informa Media Group predicts that music revenues will drop under $28bn next year, but will pick up in 2005, growing to around $32bn by 2008. It says that this will be because the industry will get a handle on file-sharing and put more stringent controls on CD copying, rather than because consumers will spend more on their music.
While the last few months have seen a spate of online song shops spring up and Apple iTunes' downloads selling faster than hot cakes, the report believes that although the sector will provide growth for record labels, it's cautious about overplaying its short-term significance. Informa believes that online music sales will rise in the next five years, but will only represent a total of around 12 per cent of the market as a whole, with digital sales only making up 5.7 per cent.
Simon Dyson, author of the report, said in a statement: "The music industry is in a bad way at the moment but the continued fall in the value of music sales is certainly not irreversible. The success of the new download services proves there is a viable market for legitimate digital sales, but the music companies must act decisively to stop the growth of the illegal services and the widespread copying of CDs."
Despite the fact that 2003 looks to be the fourth successive year of declining CD sales for the music industry, record label EMI announced better than expected half-year results – clocking up £960m of sales - but remained grim about the industry's future, predicting a drop of up to an eight per cent in sales next year.
Comments
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1. Steve Harris
Now that peer-to-peer technologies are firmly established, I can't see a crackdown on pirating being sucessful. I advise the authors of the report read 'Secrets and Lies' by Bruce Schneier and re-draft. Information in the digital domain decoded by software is insecure: we learned that when the DVD encryption was defeated.
File sharing is driven by a demand that is not met and poor value in the services otherwise provided. It will take the distribution system 2 years to properly gear up to offer an effective digital distribution path: the availability of digital media at reasonable prices from easily accessible sources will be what takes the sting out of file sharing.
2. Dave Richmond-Hawk
Has it not occured to the music industry that music might be saved by investing in "real" bands instead of the manufacturered music that they spend so much money on?
The people with the money to spend generally don't seem interested in the offerings about there at the moment.
I haven't had the urge to buy (or otherwise obtain) any new music for months....
3. Mark Solomon
This argument is now at the point of going way beyond common sense.
I specifically will not - as a matter of principle - buy so-called Compact Discs that have copy-protection mechanisms inbuilt.
I have paid £10.00 to buy a CD and expect to be able to hear 16-bit/44.1Khz goodness out of whatever set of speakers I choose to play it through, rather than having to endure WMA or any other compressed format that restricts my rights as the user of that music for MY PERSONAL ENJOYMENT.
So, for the information of BMG, I got all the way to the checkout with my copy of Dido's Life for Rent - and then removed it from my shopping. If the new SonyBMG group goes down this road, they can write off my business right now - not that I'm a lover of Jennifer Lopez, Michael Jackson, or any of Simon Cowell's pop monstrosities.
Compare this with the note on inside of Peter Gabriel's compilation HIT - a polite request pointing out that file sharing and illegal copying deprives all artists of income and reduces musical diversity.
I own nearly all of PGs catalogue so didn't buy, but I nearly did just for being treated like a law-abiding adult.
Maybe if the music business wants to increase volume (!), it should be recording music for a) people with disposable income and b) people who understand that stealing music is wrong. This combination doesn't apply to your average 10-23 year old, who can always find a better use for pocket money or student loans.
iTunes Music Store and its unbelievably equitable view of digital rights management is exactly the right solution; cheap enough for the right consumers, and just obstructive enough to put off the casual file-sharer. The RIAA and BPI should then pursue Kazaa users as is the case now.
4. Heidi Yohan
Are people craZY? These record labels and their artists have more $MONEY$ than you could EVER dream of OR ACCOMPLISH IN 5 LIFETIMES! And you are telling me that someone will pay for a CD when you can download it for free?
Do they really need more $$$$ when the kids who purchase these albums sometimes choose an album over food and books? I think AMerican consumers NEED to wake up and smell reality. Why is a singer making 45 million IN ONE YEAR ALONE...ANd Doctors and teachers (who actually most of the time can make a difference) make less than 1% of that. PLEASE STOP BUYING INTO THE GIGANTIC EGO'S OF THESE MUSIC MAKING MONSTERS. WHAT MAKES THEM MORE SPECIAL THAN YOU MY SWEETHEARTS?
THINK TWICE NEXT TIME BEFORE YOU MAKE THE RICH RICHER, AND TAKE AWAY FROM YOURSELF. <= YOU "ARE" BETTER THAN THAT.