Piracy not to blame for music sales drop - report

A new study appears to disprove claims by the record industry that file sharing is to blame for the industry's current woes. A paper published by the London School of Economics and picked up by tech website Ars Technica claims spending on CDs between 1999 and 2004 declined 40 percent - amongst households which did not even own a computer and therefore couldn't download anything. The music industry is performing better than is being claimed and declining sales can be explained by other factors in addition to illegal filesharing " the paper notes saying household entertainment expenditure has merely switched to other sources like games and live concerts. "Downward pressure on leisure expenditure is likely to continue to increase due to rising costs of living and unemployment and drastic rises in the costs of (public) services " says the report. In the UK for example in 2009 live music events surpassed record sales as musicians' primary form of income. Record companies traditionally have not benefitted directly from live events but in recent years have signed deals with major artists like Madonna and U2 in order to get a piece of the pie. The study suggests the best way of dealing with illegal downloading – which isn't going away despite the industry's best efforts – is to fund music with a levy on blank media or internet connections – "a kind of 'license to download". "