Music Sales Could Have Been Worse

With the UK teetering on the edge of a double-dip recession, the record companies are likely to shrug off a 3.4 percent drop in music sales and be thankful it wasn’t any worse.

British Phonographic Industry figures show total sales were £795.4 million ($1.26 billion), with digital sales worth about one-third of it – up from 27.4 percent in 2010.

That’s down by £28.4 million but not as bad as the £105 million it dropped between 2009 and 2010.

“It is highly encouraging for the long-term prospects of the industry that the pace of digital growth continues to accelerate,” said BPI chief exec Geoff Taylor. “British labels are supporting a wide range of innovative music services and music fans are embracing digital like never before.”

Once again the problem is that the fans aren’t embracing digital as fast as they’re deserting physical, where CD sales were down by 14 percent.

Total trade income from physical formats – albums, singles and music videos – dropped for the eighth year in a row to £513.8 million from 2010’s total of £598 million.

The 2011 market for physical albums dropped 14.4 percent to £484.7 million, compared with £566.4 million the year before.

The British music industry remains one of the UK’s strongest cultural assets and one of only three countries in the world – along with the U.S. and Sweden – with a positive “music royalty balance.”

Foreign countries pay more to hear UK music than Britain pays to hear theirs.