Transfer Pricing Associates

Music Industry blames Google for losses.

post Monday March 31, 2014

Tags: downloading, ifpi, illegal, music, spotify


Even though the revenues from music streaming services surpassed the $1 billion mark, a growth of 51 percent for the first time in history, the music industry is not satisfied. Overall there was a decrease of 3.9 percent in global music sales, according to the International Federation of the Phonographic Industry (IFPI). The music industry is accusing Google for inadequate actions against the illegal downloading of music and internet piracy. Due to Google’s lack of actions, the industry lost $600 million in sales in 2013.

It became obvious that internet piracy has been the cause of the declining revenues of music sales in the past few years. Especially when you consider that there was a 3.9% decrease in global sales, while the music streaming business is booming.

The CEO of IFPI said that the music industry has sent more than 100 million complaints and notes to Google about removing the hyperlinks to illegal music download sites in its search results. Unfortunately, there was no evidence of their efforts and actions against the piracy.

However, the music industry has found alternatives to fight the illegal downloading of music. Some internet providers are blocking certain websites in order to prevent people from visiting those sites. Furthermore, Google is now launching its own online music service and hopefully they will realize that it is beneficial for the music industry and Google itself to prevent the illegal music downloading. They still have a long way to go though, according to IFPI  a quarter of the internet users is still downloading music illegally.

2012 seemed promising for the industry, because of the first growth in sales since 1999. In several parts of the world, the revenues were slightly increasing. These numbers were, however, not representative. The sales of physical CD’s have decreased by 11.7% in 2012 and these sales are accountable for more than half of the music revenues. Furthermore, the revenues of the  iTunes store of Apple have also decreased for the first time in history. This had to do with the fact that consumers in developed countries are switching to streaming services, such as Spotify or SoundCloud.

However,  the music industry is fighting back and does not want to totally depend on Google. Apple is persuading artists to release their music only on  iTunes itself. The new album of singer Beyoncé was only available on  iTunes and was the fastest selling album last year.

The streaming services are the best performing section of the industry. The IFPI said that there were 28 million people paying for the services in 2013, while that was only 8 million in 2010. Also, the performance rights for bars and clubs grew by 19%. Overall, recorded music sales decreased from $15.7bn in 2012 to $15bn last year.

Source: telegraph

Image courtesy of Renjith Krishnan  / 

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