British Recorded Music Sales Rise for the First Time in Six Years

Reprinted from the Times Online

Susan Boyle, Lady Gaga and Take That helped the British music industry to grow in value for the first time in six years, according to official sales figures released today.

Record labels, which have faced a slump in CD sales and a long-running battle against internet piracy, experienced a rise in income from music sales from £916 million to £929 million in 2009, the British Phonographic Industry said.

The surprise increase marks the first time that the growth in income from digital services such as iTunes has outweighed the decline from sales of CDs. Income from digital singles and albums leapt by 53 per cent, to £154 million, while physical formats dropped 6 per cent to £740 million.

Album sales, which dropped in value by 7 per cent, would have fallen even farther had it not been for Boyle, the Britain’s Got Talent finalist, whose album - I Dreamed a Dream — became the fastest selling debut album of all time, selling more than six million copies worldwide.

Lady Gaga topped the single sales charts for the year, with Poker Face, helping combined digital and physical sales grow by 40 per cent, to £91.3 million. Another surprise boon for the industry came in the form of Take That. The boyband’s DVD, The Circus — Live, sold more than 570,000 copies, propelling music DVD sales up by 16 per cent, to £33.1 million.

The biggest growth came from advertising supported services such as Spotify, we7 and YouTube, which accounted for a 247 per cent growth in revenue, to £8.2 million. But despite the huge leap in income from the cutting-edge companies, their contribution to the music industry still consitutes less than one per cent of the total income.

Record labels have spent the past six months engaged in furious lobbying efforts to persuade MPs to pass the Digital Economy Act, which creates new measures to temporarily disconnect the internet connections of those who consistently flout piracy laws, as well as take down websites that host illicit content.

The Act was passed this month after a behind-the-scenes deal between Labour and Conservative MPs. But music industry executives are still not certain that the measures will come into force; the Liberal Democrats have vowed to use their influence in a new Parliament to repeal the new laws, which the party says will criminalise teenagers.

Geoff Taylor, chief executive of the BPI, said: “It’s encouraging to see industry revenues stabilise and even show modest growth in 2009. This is testament to continuing investment by UK labels in talented artists despite challenging economic conditions, and the innovation labels have shown in licensing new digital services.

“But let’s put it in broader perspective: 2009’s modest result follows a five-year drop in annual income, and total industry income has not exceeded £1bn since 2006. The CD continues to show greater resilience than many predicted – it is an excellent digital product.

“The pace of growth of new digital services is encouraging, but the size of the market continues to be constrained by competition from illegal downloads.”