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Global digital-music sales nearly doubled in 2006

Digital sales are about 10 percent of total, but haven't yet offset drop in CD sales, says trade group.

Global digital-music sales almost doubled in 2006 to around $2 billion, or 10 percent of all sales, but have not reached the industry's "holy grail" of offsetting the fall in CD sales, a trade organization said.

In its 2007 Digital Music Report, the International Federation of the Phonographic Industry (IFPI) said on Wednesday it expected digital sales to account for a quarter of all sales worldwide by 2010.

"The pace of transformation in our industry is breathtaking, but at the moment the holy grail is evading us," IFPI Chairman and Chief Executive John Kennedy said in the report.

"I would like to be announcing that a fall in CD sales is being compensated for by an equal or greater increase in online and mobile revenues. But that is not yet happening on a global basis."

Overall music sales were down 4 percent in the first half of 2006 due to piracy and competition for consumer spending.

The report said consumers last year downloaded 795 million tracks legally, up 89 percent on 2005, from almost 500 online music services available in 40 countries.

The number of tracks available online doubled to reach over 4 million on leading services, it said.

The music industry has been damaged by illegal downloading since the late 1990s, but in recent years it has fought back by targeting file-trading and offering and supporting legal alternatives such as Apple's iTunes.

The IFPI, which has taken some 30,000 actions against illegal file-sharers globally, said illegal file-sharing in Europe was contained last year despite a 30 percent increase in broadband penetration of households.