UK: 1.2 billion illegal downloads in 2010

[Fresh]

www.reuters.com/article/idUSTRE6BF1ZG20101216

Study sees 1.2 billion illegal UK song downloads in '10

(Reuters) - At least 1.2 billion songs will have been illegally downloaded by the end of 2010 in Britain, a study for the recording industry lobby group the BPI said on Thursday.

The estimate, which the study describes as "conservative," dwarfs the total of 370 million tracks across singles and albums expected to be bought legally this year.

Music industry executives said the figures underlined the scale of the problem facing record labels and other investors who are reluctant to spend on new talent when revenues are being undercut.

"Illegal downloading continues to rise in the UK," said Geoff Taylor, BPI chief executive.

"It is a parasite that threatens to deprive a generation of talented young people of their chance to make a career in music, and is holding back investment in the fledgling digital entertainment sector."

Paul Bedford, investment director at asset management group Ingenious, added: "Our experience of investing directly in recorded music artists has shown us that it remains incredibly risky against a landscape dominated by illegal downloading."

The BPI's "Digital Music Nation 2010" report said UK digital singles sales could top 160 million in 2010 versus 150 million last year, while digital album sales would total around 21 million, compared with 16.1 million in 2009.

The total digital market works out as the equivalent of 370 million separate tracks.

This year saw the first single track download to sell more than a million copies (Black Eyed Peas' "I Gotta Feeling") and more than 19 albums sold more than 100,000 digital copies, including two (Kings of Leon's "Only By the Night" and Lady Gaga's "The Fame") that surpassed 250,000 sales each, according to Official Charts Company data.

BPI figures for the 12 months ending in September, 2010 show digital services now account for 24.5 percent of UK record industry revenue from 19.2 percent a year earlier.

Rising levels of income from digital music are not offsetting declining revenues from falling CD sales, however.

The study calculates that the total number of people in the UK illegally downloading music on a regular basis is 7.7 million.

[Adonis the DemiGod!]

Ouch record companies need to crack down on this. I don't have a problem with people downloading tracks as long as they end up purchasing them.

[$uperb@tDuDe]

Its just too damn easy to download illegal songs these days.

[1shot]

Dec 17, 2010 13:11:02 GMT -5 Adonis the DemiGod! said:

Ouch record companies need to crack down on this. I don't have a problem with people downloading tracks as long as they end up purchasing them.

Yes yes, because suing the pants off of everybody is really going to make people buy more music. If anything that will just worsen it and cause a backlash. It doesn't help that CD's are so bloody expensive nowadays either. I still think 1.29 for a track is stupidly expensive. I think the record companies and the vendors selling these CD's need to rethink their pricing strategies and start offering more perks to people buying albums legally instead of trying to sue people.

[Adonis the DemiGod!]

Dec 18, 2010 3:09:10 GMT -5 1shot said:

Dec 17, 2010 13:11:02 GMT -5 Adonis the DemiGod! said:

Ouch record companies need to crack down on this. I don't have a problem with people downloading tracks as long as they end up purchasing them.

Yes yes, because suing the pants off of everybody is really going to make people buy more music. If anything that will just worsen it and cause a backlash. It doesn't help that CD's are so bloody expensive nowadays either. I still think 1.29 for a track is stupidly expensive. I think the record companies and the vendors selling these CD's need to rethink their pricing strategies and start offering more perks to people buying albums legally instead of trying to sue people.

1.29 for a track is not expensive at all. In fact its so cheap that most people don't even notice. The way for record companies to crack down is to release songs to Itunes immediately upon radio release. The longer previews on Itunes help also. However, for most people if they are in the market to buy they will buy.

[HolidayGuy]

This has been a common practice overt the last decade, and it's played a part in the decline of album sales, along with the opportunity to buy individual tracks at iTunes. But, on the flip side, digital sales of individual tracks has been pretty darn healthy.

[1shot]

Dec 18, 2010 5:41:51 GMT -5 Adonis the DemiGod! said:

Dec 18, 2010 3:09:10 GMT -5 1shot said:

Yes yes, because suing the pants off of everybody is really going to make people buy more music. If anything that will just worsen it and cause a backlash. It doesn't help that CD's are so bloody expensive nowadays either. I still think 1.29 for a track is stupidly expensive. I think the record companies and the vendors selling these CD's need to rethink their pricing strategies and start offering more perks to people buying albums legally instead of trying to sue people.

1.29 for a track is not expensive at all. In fact its so cheap that most people don't even notice. The way for record companies to crack down is to release songs to Itunes immediately upon radio release. The longer previews on Itunes help also. However, for most people if they are in the market to buy they will buy.

Well to each his/her own but I think 1.29 is ridiculous. 12 tracks x 1.29= 15.48 AND you are not receiving any digital booklets or anything. Granted, the album price may be cheaper than 15.48 but I think it's still pricey considering you don't have a CD and booklet (tons of albums I bought off of Itunes don't have them) as regular physical CD's do. To me, it's a bloody rip off. I'd be curious to see how much 1 CD actually costs for a record company to send out...

[$uperb@tDuDe]

Dec 18, 2010 16:07:03 GMT -5 1shot said:

Dec 18, 2010 5:41:51 GMT -5 Adonis the DemiGod! said:

1.29 for a track is not expensive at all. In fact its so cheap that most people don't even notice. The way for record companies to crack down is to release songs to Itunes immediately upon radio release. The longer previews on Itunes help also. However, for most people if they are in the market to buy they will buy.

Well to each his/her own but I think 1.29 is ridiculous. 12 tracks x 1.29= 15.48 AND you are not receiving any digital booklets or anything. Granted, the album price may be cheaper than 15.48 but I think it's still pricey considering you don't have a CD and booklet (tons of albums I bought off of Itunes don't have them) as regular physical CD's do. To me, it's a bloody rip off. I'd be curious to see how much 1 CD actually costs for a record company to send out...

Yeah I agree 1.29 is a bit of a rip off considering back in the days of physical singles the record company had to spend a lot more to ship physical units. These days it's just bytes which to my knowledge are free lol. I think anywhere between $0.49 and $0.99 is fair.

[bat1990]

I read an article for a class project a few months ago that said artists actually get more profit from each digital sale than each physical sale.

[ListenToItTwice]

Dec 20, 2010 21:34:12 GMT -5 bat1990 said:

I read an article for a class project a few months ago that said artists actually get more profit from each digital sale than each physical sale.

That makes sense, since there's no manufacturing cost being taken out of the profit.

[Fresh]

www.musicweek.com/story.asp?sectioncode=1&storycode=1043659&c=1

BPI wakes up the nation

The BPI has delivered a wake-up call to those who have lost sight of the UK’s illegal downloading problem with a new study that shows more than three quarters of all music tracks downloaded this year were done so illegally.

The conclusions of Digital Music Nation 2010, which for the first time harnesses Data and trends from both the legal and illegal side of the street, will make sobering reading for politicians and the media.

In the most comprehensive and sophisticated study of how people consume their music digitally the BPI estimates a total of 1.2bn illegal tracks will be downloaded by the end of this year; a figure which dwarfs the 370m tracks that will be purchased in 2010.

“To find that 76% of downloads are illegal is shocking,” says BPI chief executive Geoff Taylor, who launched the report this morning. “Despite the progress of the legal market and the high awareness of legal services illegal downloading is not decreasing.”

With these and other headline figures, which spell out the current digital landscape, Taylor wants to regain the agenda – currently dominated by the forthcoming judicial review of the DEA and problems over how the Act will work – and remind Government and others that the illegal market is still huge and holding back the development of the UK’s legitimate digital entertainment sector.

“There has been a relentless focus on the details and implementation of the Digital Economy Act,” suggests Taylor. “I think some people have lost sight of the need for urgent action. Our job is to lift their eyes.”

And the report doesn’t shy away from the hard truth. It shows:

- 1.2bn tracks illegally downloaded in 2010 from unauthorised sources

- The illegal proportion of all music tracks obtained in 2010 is 76%

- The retail value of unathorised tracks is worth £984m

- 28.8% of the UK online population are involved in illegal downloading

- 23% of the UK online population used P2P sites and software to obtain unauthorized music

- 7.7m UK internet users engaged in illegal downloading across all sources

Taylor says he believes these and other statistics in the new report will remind policy makers why the DEA is right for the digital economy and could even help bring about implementation of the Act much quicker: frustratingly the code underlying how the Act should work is long overdue, bogged down with Ofcom and the Department for Business, Innovation and Skills. It is now not expected until January.

When the DEA was passed earlier this year, it had initially been hoped that notification letters could be sent to illegal filesharers as early as January. But, now executives fear that if the timetable slips any further letters are unlikely to land on doormats before next winter.

The BPI’s move comes just days after the shadow culture secretary Ivan Lewis suggested the Government creates a cross party forum to help grow the UK’s music and creative sectors.

[Diego]

I don't think $1.29 is much of a problem - digital sales have stayed steady even with the increase. New digital albums shouldn't exceed $9.99 though - no marketing costs, no CD...so less than 10 bucks is fair. Older digital albums should all be considerably cheaper - like $4.99 or less.

[Envoirment]

Not surprised. The Pricing is going up for songs, to the point I think I'll start downloading illegally again. £1 a song is a bit too much IMO (around $1.50). It used to be 79p ($1.20), which I thought was fair. Also, I don't see why they can't slash the prices to around 50p per song ($0.75). Not only would it increase sales, it would mean that people would come away from illegal downloading, for a song (of a good digital quality) for a fair price. With regards to albums. £8 ($12) isn't bad at all compared with around £10 ($20) in the shop. However I feel digital albums should be sold at around £5-£7 ($7.50-$10.5). I'll still support my favs, but others I'm not too sure about.

I blame the music business themselves for not being smart enough to combat it effectively.

P.S: I used £1 = $1.50, it seems fair if they used the right amount of pricing for each currencey, then adjusted it 2-3 times a year, if they needed to. Otherwise I also feel that is unfair.

[spooky21]

It's the pricing again. Music industry getting greedy and inching up prices on singles. At 79p, I was buying singles left and right from Itunes. Nowadays at 1p, I actually think twice about buying new songs.

Suing individuals to stop illegal downloading didn't work so the only way to get people to download for pay is to entice them.

[spooky21]

Dec 29, 2010 15:01:04 GMT -5 Diego said:

I don't think $1.29 is much of a problem - digital sales have stayed steady even with the increase.

Therein lies your problem. Price increase should drive higher sales as long as value is perceived. If your sales are relatively flat, that indicates that additional sales from price is covering up some other eroding factor, i.e quantity.

With the sales of digital music devices up and easier access to digital music, one would expect that more customers equal higher sales. Yet in this scenario, more customers isn't really driving higher sales and price increase isn't giving you more money.