Sour note for sales
Music biz hit hard by piracy, DVD competition
The fall was led by declining formats such as the cassette and the CD single, which sank 10% and 16%, respectively. But the industry's flagship, the CD album, dropped an alarming 5% from the previous year.
On a value basis, the worldwide market for recorded music sank 5% to $33.7 billion in 2001. The disparity in the dollar and volume numbers reflected a shift in the mix even further toward CD albums, as well as toward higher pricing.
The U.S. fared better than many other developed nations, sinking 4.5% for the year in dollar terms. That compared with drops of 9.6% in Canada, 9.2% in Germany and 9.4% in Japan. However, Europe as a whole slipped just 0.8%, thanks to gains in major markets like the U.K. and France.
Latin America was one of the biggest trouble spots for the music biz. Thanks in part to rampant piracy and the broadening regional recession, the region as a whole saw a 21% slump in unit sales, with economically battered Argentina leading the way at nearly 31%.
The IFPI, like its U.S. sister org the Recording Industry Assn. of America, placed most of the blame for the worldwide shortfalls on copyright infringement in all its forms, including peer-to-peer file-sharing on the Internet and the proliferation of music knockoffs made possible via high-volume CD burners.
"The industry's problems reflect no fall in the popularity of recorded music," insisted IFPI chairman and chief exec Jay Berman. "Rather, they reflect the fact that the commercial value of music is being widely devalued by mass copying and piracy."
Ironically, three countries that top the industry's list of the most egregious piracy offenders also showed some of the strongest gains for the year. Russia, China and India each logged sales gains of more than 15%, as economic improvements boosted the comparatively tiny market penetration in those nations.
