IFPI: 95% of all music downloads are unauthorized

Although sales of digital music are increasing worldwide, the global recording industry's representatives are now calling on ISPs to temporarily shut down music pirates' Internet accounts if all else fails.

A large majority of digital music downloads are "unauthorized" -- meaning, no payment is made to either artists or producers. This according to a report issued Thursday by the IFPI trade association, which represents the recording industry worldwide.

Despite all the piracy, though, paid sales of digital music grew to the tune of 25% to $3.7 billion worldwide in 2008, even with the economic crisis that emerged in the latter part of the year. In fact, digital music platforms accounted for around 20% of all recorded music sales last year, up from roughly 15% in 2007, according to the IFPI's newly released Digital Music Report 2009.

The report cites Nielsen SoundScan data as showing that digital album sales in the US alone rose 32% in 2008, to a total of 66 million albums. The US is the world's largest consumer of paid digital music, accounting for about half of all "digital music market value," the industry group says.

The IFPI points out that increasing numbers of Web sites are now licensed to sell DRM-free tracks -- and that, in January of last year, Apple's iTunes announced it was issuing eight million DRM-free tracks.

But the report also specifies a number of actions taken by the recording industry lately in various countries to combat piracy.

Last month, "the US recording industry announced it was working with the
Attorney General of New York State and leading ISPs on anti-piracy initiatives," said IFPI President and Chief Executive John Kennedy, in his introduction to the report.

"In France, a draft Creation and Internet Law sets up a system of 'graduated response' by which ISPs will write to persistent copyright abusers to educate and warn them about their actions, as a last resort sanctioning them with loss of Internet access for between one and 12 months," according to a statement released by the IFPI in conjunction with the Digital Music Report.

"Research suggests the graduated response scheme will be effective. Seven in ten (72 per cent) of UK music consumers would stop illegally downloading if told to do so by their ISP (Entertainment Media Research, 2008). Seven in ten (74 per cent) French consumers agree Internet account disconnection is a better approach than fines and criminal sanctions," the IFPI's statement continues.

"In July 2008, the UK government brokered a joint 'Memorandum of Understanding' between the recording and film industries and the six largest ISPs, binding the parties to work to achieve a significant reduction in unauthorised file-sharing. At the same time, the government initiated a consultation on legislative options to deal with Internet piracy."