Study: 1.2 billion illegal UK song downloads in 2010

At least 1.2 billion songs will have been illegally downloaded by the end of 2010 in Britain, a study for the recording industry lobby group the BPI said on Thursday.

The estimate, which the study describes as "conservative", dwarfs the total of 370 million tracks across singles and albums expected to be bought legally this year.

Music industry executives said the figures underlined the scale of the problem facing record labels and other investors who are reluctant to spend on new talent when revenues are being undercut.

"Illegal downloading continues to rise in the UK," said Geoff Taylor, BPI chief executive.

"It 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."

Paul Bedford, investment director at asset management group Ingenious, added: "Our experience of investing directly in recorded music artists has shown us that it remains incredibly risky against a landscape dominated by illegal downloading."

The BPI's "Digital Music Nation 2010" report said UK digital singles sales could top 160 million in 2010 versus 150 million last year, while digital album sales would total around 21 million, compared with 16.1 million in 2009.

The total digital market works out as the equivalent of 370 million separate tracks.

This year saw the first single track download to sell more than a million copies (Black Eyed Peas' "I Gotta Feeling") and more than 19 albums sold more than 100,000 digital copies, including two (Kings of Leon's "Only By the Night" and Lady Gaga's "The Fame") that surpassed 250,000 sales each, according to Official Charts Company data.

BPI figures for the 12 months ending in September, 2010 show digital services now account for 24.5 percent of UK record industry revenue from 19.2 percent a year earlier.

Rising levels of income from digital music are not offsetting declining revenues from falling CD sales, however.

The study calculates that the total number of people in the UK illegally downloading music on a regular basis is 7.7 million.

(Reporting by Mike Collett-White, editing by Paul Casciato)