According to the LA Times music piracy is now so rampant in Latin America, and especially Mexico, that it is jeopardising the music industry there. The paper says the sale of bootlegged CDs at 50 cents a time on the black market has caused a 25% drop in legitimate record sales in the last twelve months. As a result even large record labels are struggling while many music retailers are going out of business.
The number of people working in the Mexican music industry, for example, is now half what it was in 2003. Meanwhile record labels are having to cull their rosters to make ends meet meaning bands which appear to be doing well are having to be dropped because so many of their record sales are bootlegs. According to the paper Mexican rockers El Tri are the most recent band to suffer this fate - they have just been dropped by Warner Music.
Back in the US online piracy has been credited (or blamed, depending on how you look at it) with the recent fall in CD prices. According to the New York Times the price CDs retail at has been falling for some time, and in the first quarter of this year fell another 4%. While analysts reckon legitimate download services are yet to have an impact on the sale of CDs, research firm NPD says the competition from illegal downloading has definitely had an effect. NPD music boss Russ Crupnick: "Had you not had peer-to-peer, it's unlikely prices would have declined as much as they have".