Sort it out...
This article is just a stream of incomparable numbers until we do something with them.
So why don't we turn those global figures into something useful, eh?
A) You state that [Global physical revenue for 2008] = $13.83bn = a 15% fall.
Therefore [Global physical revenue for 2007] = [(13.83/85) * 100] = $16.27bn.
Therefore [Global Physical revenue] decline = [16.27 - 13.83] = $2.44bn.
B) You state that [Global online revenue for 2008] = $3.78bn = a 24% increase.
Therefore [Global online revenue for 2007] = [(3.78/124) * 100] = $3.05bn.
Therefore [Global online revenue] increase = [3.78 - 3.05] = $0.73bn.
C) Therefore [Total global revenue for 2008] decrease = [2.44 - 0.73] = $1.71bn.
This decrease as a percentage of [Total global revenue for 2007] = [1.71 / (16.27+3.05)] = the 8.85% decrease in revenue from music sales that they're claiming.
D) Moving on...
The International Federation of the Phonographic Industry (IFPI) is the organisation that represents the interests of the recording industry worldwide. Their own January 2009 Music Report {@ http://www.ifpi.org/content/section_resources/dmr2009.html} makes the headline claim that "95 per cent of music downloads are unauthorised, with no payment to artists and producers". So what they're claiming is that the $3.78bn [Global online revenue for 2008] represents only 5% of music that is downloaded. Ok...
E) Let's ask ourselves two questions:
"Has the amount of music listened to in the past year decreased by an 8.85%, equivalent to the decrease in revenue?" Very doubtful. In fact, with the proliferation of personal music player use (iPods, phones, etc...) music listening is almost certainly up. "But By how much?" We don't know exactly. But we can do some more sums.
F) So let's do some more sums...
And lets come back to that 95% the IFPI have referred to. If the 3.05bn [Global online revenue for 2008] represents 5%, then [(3.05/5) * 95] = $57.95bn = the potential revenue if those 95% of unauthorised were authorised an monetised in the same way as the 5%. A $57.95bn income monetised overnight would mean that [Total global revenue for 2008] increase compared to 2007 = [57.95 - 1.71] = $56.24bn.
As a percentage figure, $57.95bn monetised overnight would represent a more than threefold increase (329%) in total revenue. (Or a 1533% increase in online revenue!)
G) So, to sum up...
Q1: Has listening to acquired recorded music, as an activity, increased by more than threefold?
A1: Of course not. There's an almost insatiable demand and supply of music, but only a limited number of hours in the day.
Q2: So how come there are so many unauthorised downloads?
A2: Now that there's an alternative, people are less willing to pay £10 up front for twelve songs (10 of which they've never heard before).
Q3: Would the music industry income increase by more than three times what it currently stands at if it could (by some miracle) suddenly stop unauthorised downloads tomorrow?
A3: Of course not. But there's an almost insatiable demand and supply of music.
Q4: So is it morally right to distribute or acquire a recording of an artists musical efforts if it goes against their wishes?
A4: Of course not.
Q5: Will the number of unauthorised downloads decrease if current arrangements persist?
A5: Of course not.
Q6: So where does the music industry go from here?
A6: Broadly speaking, stop p!ssing around. And do the following:
Solution (i), for downloads: Set up a legit version of Allofmp3. It had the range, the ability to select a favoured quality setting and was priced accordingly. Most importantly, it was priced attractively at around £3 to 4 for an album of mp3s at satisfactory quality. On top of that, offer decent discounts to frequent purchasers. Selling Mp3s for the same price as CDs (as is the case at present) is plain ridiculous.
Solution (ii), for streaming/previewing: Set up a comprehensive version of Spotify: It's excellent. Most importantly, it just works. Beef up the subscription offering so that it combines with, or offers last.fm style functionality & more.
Solution (iii), for download customers & streaming subscribers: Offer incentives. Give out prizes (festival/concert tix, signed merch, a VIP meet the artist day, etc) to your paying customers a a reason to convert from CDs and give up the .
NB: I don't do the "unauthorised downloads" thing, I just buy from Amazon Marketplace.