Microsoft ZuneWhile sales of digital music is on the rise, the music industry overall is experiencing a slowdown. Consumers are losing interest in compact discs (when was the last time you bought a CD?) and balking at paying for the digital alternatives (downloading it for free is faster and easier!), the music industry is looking for new allies, including Internet service providers, lawmakers — even karaoke bars.

First, the good news: The International Federation of the Phonographic Industry said last week that worldwide digital music sales rose to $2.9 billion last year, from $2.1 billion a year earlier. That was about 15 percent of overall sales, up from 11 percent a year earlier and less than 1 percent in 2003.

But digital sales have yet to make up for the shortfall in sales of compact discs, and overall sales of recorded music fell about 10 percent last year, to $17.6 billion, the federation estimated. A recovery in the music industry remains at least a year away, the federation’s chief executive, John Kennedy, said.

And as we’ve seen, the recording industry is broadening its search for revenue. Plans are in the works to hold Internet providers responsible for stopping piracy over their networks, Mr. Kennedy said. It is lobbying the United States government to recognize a European form of copyright that has provided musicians with a steady royalty stream. Mr. Kennedy praised a deal brokered last year by French officials, in which Internet service providers agreed to shut down the accounts of persistent copyright violators. Industry representatives are pushing for similar measures in countries like Britain and Sweden. In China, where piracy is rampant, the music industry is considering a lawsuit against, the largest Internet provider, Mr. Kennedy said.

Some developments favored the music industry in China. Under a recent agreement, karaoke bars now recognize audiovisual rights to music videos and would collect fees. That ought to get the recording industry back in the red….

Source: The New York TImes