Global Digital Music Trends Record companies continued their transition into a digital business in 2007. Music sales via online and mobile channels have risen from zero to an estimated US$2.9 billion – 15% of industry sales - over the last five years, making music more digitally advanced than any entertainment sector except games. The U.S. alone, that was not enough to offset the 10% decline in overall music sales to 17.6 billion, according to a report by the International Federation of the Phonographic Industry. Compared to other industries, music is second only to games in its transition to digital revenues. For newspapers, it is 7%, for films it is 3%, and for books only 2%. In the U.S., however, digital sales account for 30% of industry sales, according to the IFPI. (Nielsen SoundScan, however, says digital music accounts for 23% of sales in the U.S., based on different data). The report also looks at mobile sales of digital music, including ringtones. While online sales of digital music in the U.S. are nearly double those of mobile sales, there is some evidence that gap might close (or even reverse) as mobile data networks become faster. In Japan, for instance, 91% of digital music sales are mobile and 40% are full-track mobile downloads (the rest are ringtones). Other Stats; * The first-ever global music download sales chart is topped by Avril Lavigne, who sold 7.3 million track downloads of her song Girlfriend across the world in 2007 * Global digital music sales are estimated at approximately US$2.9 billion in 2007, a roughly 40% increase on 2006 (US$2.1 billion) * Single track downloads, the most popular digital music format, grew by 53% to 1.7 billion (including those on digital albums) * Digital sales now account for an estimated 15% of the global music market, up from 11% in 2006 and zero in 2003. In the world’s biggest digital music market, the US, online and mobile sales now account for 30% of all revenues * The music industry is more advanced in terms of digital revenues than any other creative or entertainment industry except games. Its digital share is more than twice that of newspapers (7%), films (3%) and books (2%) * There are more than 500 legitimate digital music services worldwide, offering over 6 million tracks – over four times the stock of a music megastore * Tens of billions of illegal files were swapped in 2007. The ratio of unlicensed tracks downloaded to legal tracks sold is about 20 to 1 * Progress in the digital music market is being hampered by lack of interoperability between services and devices, and lack of investment in marketing of new services * The growth rate of around 40% in digital sales did not offset the sharp fall in CD sales globally, meaning that the overall market for the year will be down on 2006 * Research by IFPI debunks a myth about illegal P2P services: in fact, fans get better choice on legal sites. IFPI conducted research with a sample of 70 acts on the legal site iTunes and on the copyright infringing service Limewire. In 95% of searches the artists requested had more songs available on iTunes than on the leading P2P service.
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