World 2000 music sales sag as free Web sites bite
By Merissa Marr
LONDON, April 19 (Reuters) - Free online music took its toll on global music sales last year as fans in the world's biggest market, the United States, flocked to Napster and other sites, snubbing old-style formats such as singles and cassettes.
World music sales sagged 1.3 percent in value terms to $36.9 billion in 2000, despite overall improved album sales and a more upbeat performance from Europe, the International Federation of the Phonographic Industry (IFPI) said.
``Last year was a mixed picture for the global recording industry,'' IFPI chairman Jay Berman said in a statement. ``We saw the first evidence of the impact of free online music, as well as the damage being done by unauthorised CD copying''.
A downturn in the U.S. economy also hit music sales in an industry which is already facing the prospect of slowing growth as the effect of replacing old formats such as cassettes with compact discs (CDs) wanes.
Singles are also proving to be a dying breed. Sales slumped a dramatic 46 percent in the United States in 2000, for a global fall of 14 percent, which the IFPI blamed on the availability of free online music sites.
The most popular of those sites, Napster, is now facing an increasingly gloomy future after being ordered by a U.S. court to filter out copyrighted songs and the world's top music groups hope at least in part to plug the gap with their own legitimate online ventures as they seek to sustain long-term growth.
``Significant progress was made towards realising the huge potential of the legitimate online music market,'' Berman said.
SHINE COMES OFF MIGHTY U.S. MARKET
While CD growth is expected to slow in future, CD album sales kept up a modest pace last year, rising 2.5 percent to 2.5 billion units, the IFPI said.
Following two strong years for repertoire and releases, the United States, which represents almost 40 percent of the total world music market, saw a decline in value of 1.5 percent and in units of 4.7 percent.
In contrast, European sales rose 1.4 percent in value and 1.3 percent in units with Britain contributing a rise of 3.8 percent in value. However, France, Germany and Italy all felt the heat from mass CD copying and piracy, the IFPI said.
In Japan, another of the world's top music markets, sales rose in unit terms but fell in value terms given a large number of releases of low-cost compilation albums.
Latin America and Asia, which both suffer from high levels of piracy, registered declines in sales.
Last year's performance compares to a more healthy 1999 which saw global music sales rise 1.5 percent to $38.5 billion after the U.S. put in a fifth year of growth.
The IFPI compiles music industry sales figures twice a year based on data gathered from its 1,400 music companies in 70 countries around the world.
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