U.K. Music Piracy is Eroding Digital Revenue Growth, BPI Says

The value of illegally downloaded music in the U.K. will be worth 1 billion pounds ($1.56 billion) this year, as the practice proliferates and slows growth of the digital music market.

An estimated 7.7 million U.K. Internet users illegally download music on a regular basis, meaning musicians, songwriters and music companies receive no payments, according to the Digital Music Nation 2010 report from the British Recorded Music Industry trade organization.

Though the U.K. boasts 67 legal online music services, more than any other country, there is no effective deterrent to obtaining music illegally, BPI said. The music industry is lobbying government to implement the Digital Economy Act, passed earlier this year and designed to curb illegal file sharing by requiring Internet service providers to block some users.

Digital music growth in the U.K. “is a fraction of what it ought to be,” BPI Chief Executive Officer Geoff Taylor said in a statement.

Illegal downloading “is a parasite that threatens to deprive a generation of talented young people of their chance to make a career in music and is holding back investment in the fledgling digital entertainment sector,” he said.

Digital services now account for 24.5 percent of U.K. record industry revenue, BPI said, from 19.2 percent a year ago.