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December 16, 2010

Piracy cost the UK music industry £1bn this year

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by Darren Allan

The BPI’s latest report on the theatre of digital music, as compiled by Harris Interactive, has highlighted a big – albeit unrealistically inflated – number at the centre of the piracy debate.

The report estimates that pirated tracks accounted for three-quarters of all music downloads this year, and that this cost the industry close to £1 billion.

But as the Register, who wrote an article on the report points out, illegal downloads don’t necessarily equate to lost sales. Apparently, the BPI employs a substitution ratio of about 4.5:1, which means in real terms, the fiscal loss is more to the order of approximately £220 million (that’s according to separate figures from Jupiter Research).

On a more positive note, sales of digital singles are looking to crest over the £160 million mark for 2010, which is up around 7% on last year’s £150 million.

The BPI took the opportunity to urge Ofcom to push on with implementing the anti-piracy measures contained in the rushed-through Digital Economy Act. That’s the three-strikes-and-you’re-out malarkey for alleged illegal downloaders…

Story link: Piracy cost the UK music industry £1bn this year

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  1. And the BPI ratio is high, reality I think from a much more considered US report was 10:1… so all of a sudden £1Bn is £100m AT BEST. But this does not stop the lazy media trotting out the £1bn as if it was true.

    Presumably Ofcom have twigged the DEA is a dog, liable to be dragged through the courts and cost a fortune to achieve.. nothing.

    That the BPI still think DEA is a panacea is no surprise. A group that treated digital online like cassettes and CDs… they are the Canutes of industry.

    Comment by David M — December 16, 2010 @ 5:44 pm

  2. And how much do the UK industry make in the UK? How exactly can they know how much piracy costs when it is an underground thing?

    Simply because a person downloads doesn’t necessarily mean they would have bought it in the store if they didn’t have another option. They would probably just record off the radio or whatever is needed to get it for free.

    Comment by Shadow — December 16, 2010 @ 10:21 pm

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