No surprises here really. In fact, I think there was another report last week that said more or less all of this also. Anyway, a new report from those International Federation Of The Phonographic Industry chaps confirms that global digital music sales almost doubled in 2006 so that they were worth over $2 billion - and about 10% of all music sales. Some 795 million tracks were downloaded from nearly 500 legitimate online music services in 40 countries - an 89% increase on 2005. The trade body now reckons the growth will continue so that digital accounts for a quarter of worldwide music sales by 2010.
But, and it's a crucial but, the report also confirms that, even with the recent boom, digital sales were not fully compensating for the slump in physical CD sales, meaning that overall music sales were down - by 4% in the first half of last year.
Commenting on the report, IFPI chief John Kennedy told reporters: "The pace of transformation in our industry is breathtaking, but at the moment the holy grail is evading us. I would like to be announcing that a fall in CD sales is being compensated for by an equal or greater increase in online and mobile revenues. But that is not yet happening on a global basis".
Of course, the report blames some of that on the ongoing popularity of P2P file sharing, and makes particular reference to the failure of the internet service providers in this domain, with implications that this is an area where the trade association plans to step up its activity in the coming year. Of course, the music business has long had problems with the internet industry, arguing that ISPs used the growth in file sharing to persuade early adopters of the need for their broadband services, even though much of that file sharing was illegal. Internet companies, some label execs argue, continue to passively approve of such file sharing by failing to help in the content owners' campaign against P2P based copyright violation.
The IFPI's end of year report says: "With cooperation from ISPs we could make huge strides in tackling internet piracy globally. They have it within their power to limit access to copyright infringing material and therefore hold the key to substantially reducing online piracy. Technology similar to that used to block access to child pornography could be used to block access to websites that facilitate infringing file-sharing of copyrighted music. It is very unfortunate that it seems to need pressure from governments or even action in the courts to achieve this, but as an industry we are determined to see this campaign through to the end".
In an interview with the FT, Kennedy accuses the ISPs of "filibustering" in this area, and again implies that the IFPI will be focusing its attention of winning political support in this domain, pointing to a "legislative clampdown" in order to bring the ISPs in line.