- The Washington Times - Monday, October 3, 2005

ASSOCIATED PRESS

The digital music market has more than tripled in a year, helping offset a continuing decline in sales of compact discs and other physical formats of music.

Spurred by Apple Computer Inc.’s IPod music players, digital music sales totaled $790 million in the first half of this year, equivalent to 6 percent of industry sales, the International Federation of the Phonographic Industry (IFPI) estimated in a report yesterday.

That compared with $220 million a year earlier.

Recorded music sales fell 1.9 percent to a retail value of $13.2 billion in the first half of this year, compared with $13.4 billion a year ago.

The digital boom, which now exceeds the value of the global singles market, was driven largely by sales in the top five markets — the United States, Britain, Japan, Germany and France, the group said in the report. Sales of physical formats fell 6.3 percent by value in the period to $12.4 billion.

That partly reflected pressure on prices: CD sales were down 6.7 percent in value but only by 3.4 percent in unit volume. DVD music video sales fell 3.1 percent in value and 1.6 percent in units.

The United States experienced a drop in physical format sales of 5.3 percent in value but a strong increase in digital music sales, with single-track downloads totaling 159 million in the first half of this year, nearly three times the figure for the previous year.

Apple’s ITunes online music store accounts for 82 percent of legal downloads in the United States. The company has sold more than 500 million songs online and about 22 million IPod digital music players.

The recording industry aggressively has pursued computer users for trafficking in pirated music online. Since September 2003, the industry has sued more than 14,800 of them in the United States alone.

The report said digital sales helped compensate for a fall in CD sales in Germany, with single-track downloads growing to 8.5 million in the first half of 2005 compared with 1 million a year ago. Physical format retail sales dropped 7.7 percent in units.

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