The U.K. recorded music business held up reasonably well in 2008 with trade value down by 5.3% to £894 million ($1.368 billion) and retail value down by 6% to £1.308 billion ($2.002 billion), according to new figures from trade body the BPI. That compares to falls of 13% and 15% for, respectively, trade and retail value between 2006 and 2007.
In 2008 album sales were still on the decline by 3.2% by volume while at the same time digital album sales was up 65% from 2007. Digital albums by Coldplay, Duffy and Kings of Leon each moved more than 100,000 units last year.
The figures also show that 109.8 million single tracks were downloaded in 2008, a 41.6% year-on-year increase. Digital tracks now account for 95.3% of the singles market.
“The rapid growth of the digital market is clear evidence that British record companies have the business models in place to deliver music to fans online,” said BPI chief executive Geoff Taylor in a statement.
“The impressive fact that one pound in every ten is earned online shows that labels are leading the way in the entertainment world in developing digital services.”
He added: “BPI’s research also shows that U.K. record companies invest 21% of turnover on sales in A&R expenditure – identifying and developing new musical talent – over the last three years.”
Rock was still the dominant genre in the albums market, representing 35.7% of sales, while pop increased its share from 22.3% to 25.3%.
In the retail sector, specialists still dominate the albums market, with HMV the market leader with a 24.1% share by expenditure. Tesco is the biggest mass merchant with a 10.5% share, while iTunes has 5.7% total market share in the U.K. and dominates the digital album market. The Internet home delivery services, including Amazon and Play.com, account for 17.6% of the market.
For singles, iTunes’ share of expenditure is up to 65.7% of the market, while unit share is 71.8%.
Research also shows that 7.2 million MP3 players were sold in 2008, with a third of the U.K. population now owning one. Almost a third (28%) of 16 to 24 year olds listen to music at least weekly on a mobile phone, with one in 10 using services such as Spotify and Last.fm at least once a week.