The drop-off followed figures in 2012 which showed the
industry, hard hit by illegal downloads and music piracy,
registering its first revenue gains since 1999, to $16.5
In its latest annual report, the London-based industry
federation IFPI said most of the decline in 2013 was due to a
16.7 percent revenue slump in Japan, which is making a belated
transition away from physical products like CDs to digital
delivery via the latest technology.
Excluding Japan, global revenues fell by 0.1 percent, the report
"There can be bumps in the future, no question, but it doesn't
take anything away from the general direction the music industry
is heading which is more digital, more services, more consumer
choice and more consumer satisfaction with the services offered
and probably more consumption," Edgar Berger, president and CEO,
International, of Sony Music Entertainment, said at a news
"So I personally believe it's going to be an absolutely growing
business," Berger said.
Max Hole, chairman and chief executive officer of the
international division of Universal Music Group, said the
numbers were even more impressive given the deep hole the
industry was in at the beginning of the last decade.
"You've clearly got evidence there are now music services that
absolutely the consumer is engaging with," he said.
The IFPI said that among the encouraging trends was a sharp
uptick in revenues for subscription services.
"The digital market has continued to diversify with revenues
from subscription services, such as Deezer and Spotify, growing
by 51.3 percent, passing the $1 billion mark for the first
time," the IFPI said.
"Global revenues from subscription and advertising-supported
streams now account for 27 percent of digital revenues, up from
14 percent in 2011."
It also said Europe had registered overall growth for the first
time in 13 years, revenues were stable in the United States and
sales were up in Latin America.
[to top of second column]
"Even accounting for the difficult situation in Japan, the global
recording industry is in a positive phase of its development," IFPI
chief executive Frances Moore said in a statement.
"Revenues in most major markets have returned to growth. Streaming
and subscription services are thriving. Consumers have a wider
choice than ever before between different models and services.
"And digital music is moving into a clearly identifiable new phase
as record companies, having licensed services across the world, now
start to tap the enormous potential of emerging markets."
PIRACY REMAINS MAJOR CONCERN
But Moore said piracy remained a serious problem, with surveys
showing that as many as one in four Internet users download pirated
"This is despite that fact that our own research shows 50 percent of
the people using infringing services know there are paying
services," she said, saying there needed to be even more efforts to
crack down on content that is available illegally.
The IFPI reported strong revenue growth from performance rights
coming from broadcast, Internet radio services and performance
"Performance rights income to record companies crossed the $1
billion threshold for the first time in 2013 to hit $1.1 billion,"
"This was an increase of 19 percent, more than double the growth
rate in 2012, accounting for 7.4 percent of total record industry
(Editing by Stephen Powell)
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