The Latin Recording Academy

It should come as not surprise to anyone in the music business, but the news in the just released Recording Industry in Numbers 2010 report by the London-based International Federation of the Phonographic Industry(or IFPI), are, at best, mixed. 

Global music sales fell another 7.2% in 2009.

But in Latin America, the growth in digital music sales and performance rights nearly made up the losses in physical sales. Revenues in Latin America fell only 0.7 %.

IFPI Latin America’s Regional Director Raúl Vazquez notes that “in macro-economic terms, the global crisis affected Latin America less than what it affected the United States and Europe and that is reflected in the music market.”

Three Latin countries appearing in the top 20 markets:

Spain at number 10, Brazil at number 11 and Mexico at 18.  But while the United States remains the top market, this doesn’t necessarily translate into a strong US Latin market.

“If we were to consider the Latin market in the US separately, it probably wouldn’t make the Top 20,” says Vazquez. “The drop of the US Latin market the past four years has been dramatic.”

The IFPI report noted “some positive points” in the global music business, including growth in 13 markets -- one of them Brazil. Furthermore, digital music sales grew 9.2%, reaching a market value ten times greater than in 2004. There were double-digit growth rates in digital sales in more than 30 countries, including Argentina where it grew more than 40%.  

Digital sales represent now a 14% share of all music sales in Latin America, surpassing Europe, where 13% of sales are digital. One dramatic example of this growth is Mexico, where digital sales actually offset physical sales, a phenomenon IFPI calls the “Holy Grail.” (Mexico is one of only six countries where this happened. The others are the United Kingdom, India, South Korea, Thailandand Australia).

In the region, the most notable increase, however, is in performance rights, which grew 23.2%. According to IFPI’s report, in 2009, Mexico

“more than doubled” the 2008 numbers.

This, according to IFPI Latin America’s Vazquez, is due to the fact that “in recent years, producers’, authors’ and performers’ societies [in the region] have emphasized this area of the business. As a result, he says, “ in the past five years, the collection has grown four-fold.”

According to IFPI, piracy remains the biggest challenge to the industry. The report notes, for example that in Spain, “where illegal file-sharing is more than double the average rate in Europe,” the music market has dropped 60% since 1999.  Album sales by new artists in Spain fell by two thirds since 2004. Brazil, the report notes, is a similar case.

“Solving piracy,” says Vazquez, “a big part of the  problems in the industry would be solved.”

For more information visit www.ifpi.org