IFPI Digital Music Report 2005: facts and figures

The Growing Legitimate Digital Music Market

Legal music sites have quadrupled to over 230 in 2004
- up from 50 a year earlier
- Over 150 services available in 20 countries in Europe
- Over 30 services in the UK, more than 20 in Germany and 10 in France
Available repertoire has doubled over 12 months to 1 million tracks from January 2004 to January 2005
Paid-for downloads up tenfold in 2004 to over 200 million
- from 20 million up to 140 million in the US (Nielson Soundscan)
- from zero to nearly 6 million in the UK (UK Official Chart Co, BPI)
- up dramatically in Germany with nearly one million from Musicload in December (Musicload)
The digital music market was worth US$330 million in 2004 - up on 2003 and set to double in 2005 (Jupiter research). This represents about 1.5% of record company revenues
Some third analysts and record companies predict digital sales could reach 25% of revenues in five years
It is estimated that 50 million portable players were sold in 2004 (IDC), of which 10 million were iPods (Apple)

Infringing music files on the Internet overall (peer-to-peer and other) are down to 870 million in January 2005 from 900 million in January 2004
Infringing music files solely on P2P networks worldwide is an estimated 760 million, down from January 2004's 800 million and sharply down on April 2003's one billion
A drop of 900,000 users on the most popular peer-to-peer service (FastTrack, which includes KaZaA) since January 2004, from 3.2 million to 2.3 million
Use of services other than KaZaA is increasing - but not necessarily of music files. Music files represent a smaller proportion; eg. an estimated 25% of files on eDonkey are music, compared to an estimated 75% on Kazaa
75% of all distribution of illegal music files on P2P networks is accounted for by 15% of individuals (NPD)

7 out of 10 people in Europe are aware that file-sharing without permission of copyright holders is illegal
More people are buying music online legitimately. The same number of music downloaders say they download from a legal source as from a P2P service (44% each)
More people intend to buy music online legitimately. Almost one third (31%) of music downloaders say they are likely to download from a legal service (compared to 22% now) and 55% say they will download from a legal source, including eg artist website (compared to 44% now)
Awareness of legal online music services has risen. 49% of 16-29 year olds Dec 2004 are aware of legal ways to buy music online, up from 38% in December 2003 (GfK)

More than 7,000 cases have been brought against bulk uploaders in Austria, Canada, Denmark, France, Germany, Italy and the UK and the US to date
There will be many more legal actions in more countries in 2005
In 2004 the music industry's anti-piracy activities secured the take-down of 60,900 pirate sites, 477 unauthorised P2P servers and 1.6 billion infringing music files in 102 countries