Piracy and competition for consumer spending drove global music sales down 4% in the first half of 2006 despite the continued popularity of digital music, an industry trade group said today.
The International Federation of the Phonographic Industry (IFPI) said total music sales fell in the period to $13.7 billion in retail value due to the continued decline of physical sales such as CDs.
IFPI Chairman and CEO John Kennedy has said he expects digital sales to make up for the decline in physical sales.
The group said digital sales rose 106% in the first half to $945m, meaning digital sales now account for 11% of the total recorded music market worldwide, up from 5.5% at the end of 2005.
'The explosion in digital music services, spurred by consumer demand and a widening array of delivery channels, has seen online and mobile music sales grow from $134m in the first half of 2004 to $945m in the first half of 2006,' the IFPI said.
The music industry, damaged by illegal downloading since the late 1990s, has fought back by aggressively targeting file-trading and offering legal alternatives such as Apple's iTunes Music Store.
In the US, the world's top market, digital sales increased by 84% to account for 18% of the total market. Digital music also accounted for a significant part of the overall market in South Korea (51%), Japan (11%), Italy (9%) and the UK (8%).
The sales in physical formats fell 10% worldwide. The trade group said piracy and competition for consumer spending also contributed to the first-half fall.
The global sales fall of 4% for the first half exceeds the 3% fall recorded for the whole of 2005 but a spokesman for the trade group said the second half of the year tended to be stronger due to Christmas sales. He said music sales were therefore estimated to be roughly in line with last year.
