WORLDWIDE MUSIC SALES DROP 5%

Despite strong worldwide showings by such artists as NSYNC, Janet Jackson and Destiny’s Child, global music sales for the first half of the year slid 5% in value and 6.7% in units.

In its report released Friday (9/28), the International Federation of the Phonographic Industry cited a slowing economy and illegal CD copying as prime reasons for the decline.

World CD sales fell 4.6% while cassettes and singles continued their long-term decline to drop 16.3% and 14.4% respectively, according to the report.

"The availability of unauthorized music and extensive copying has been exacerbated in the economic slowdown," said Chairman/CEO Jay Berman. "We've always had the problem of copying and piracy, but in an expanding economy it has less of a commercial impact."

Berman’s summation was met with some disagreement by the U.S.-based music retailers association, NARM. While NARM agrees with Berman’s assessment that consumers are engaging in CD-burning and file sharing on a massive scale, it has a problem with where the blame for soft-sales actually lies.

"We don’t choose to characterize our own customers as the problem," said NARM President Pamela Horowitz. "We think the problem lies with the record companies. Instead of offering either singles or downloads through legitimate retailers, they offer neither, and simply increase the price on CDs. Retailers could have been competing with CD-burning and file sharing if they had been given the chance."

IFPI’s report says music sales fell in all but two of the top 10 markets in the first six months of the year.

In Britain, a strong release schedule led by Gorillaz and Travis lifted sales 10.5%, while a surge in local artists boosted French sales 7.9%.

However, sales in the world's biggest market, the United States, saw a 5.3% drop to $5.8 billion while the second biggest, Japan, saw sales slide 7.2% to $2.7 billion.

CD "burning" or copying on to blank discs has overtaken sales of legitimate CDs in some countries including Germany where music sales fell 11.3% to $935 million.

Worldwide sales of blank recordable CDs, meanwhile, are expected to rise 40% this year.

Sales in Latin America fell 20%, sales in Asia dropped 8.1% and Europe remained flat overall.