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RIAA Cites Downloads As Factor In Declining Sales

The music industry attributed declining 2001 unit and dollar volume to the economy, terrorism, and consumers who download and copy music in violation of copyright law.

U.S. shipments to retailer channels fell for the second consecutive year in units and dollars, and the downward trend was accelerating, according to Recording Industry Association of America (RIAA) statistics.

Unit sales in 2001 fell 10.3% to 968.6 million on a 4.1% dollar-volume decline to $13.7 billion. That follows 2000′ 7% unit-sales decline and 1.8% dollar-sales decline.

Sales were up in 1999 and 1998 but down in 1997.

“There is no simple explanation for the decrease in sales,” said RIAA president Hilary Rosen. But, she claimed, “a large factor contributing to the decrease in overall shipments last year is online piracy and CD burning.”

Rosen cited the results of a consumer survey conducted for it by Peter Hart Research Associates.

In surveying 2,225 music consumers between the ages of 12 and 54, Hart found that 23% said “they did not buy more music in 2001 because they downloaded or copied most of their music for free.”

The survey also found that more than 50% of the people who downloaded music for free have copied it to a portable device or, via CD burner, to a CD.

Ownership of CD burners has increased, the survey also found. In 2001, 40% of music consumers owned a CD burner, compared with 14% in 1999.

In releasing sales statistics, the RIAA said unit sales of CDs and prerecorded cassettes fell, while sales of vinyl LPs and DVD music videos rose.

Full-length CD sales fell 6.4% in units and 2.3% in dollars to $12.9 billion. CD, nonetheless, increased its share of music shipments to 91% of all units shipped in 2001, compared with 87% in 2000. Cassette sales fell 40% in units and 41.9% in dollars to $363 million, while LP sales rose 3.7% to 2.3 million units, with dollar value reaching $27.4 million.

DVD music video sales rose 138% to 7.9 million units, with dollar volume rising 137% to $190 million.

5-Year Music Sales

(in millions)