Playlistmag.com has this to say about downloading music and CD sales:

Digital music sales doubled in 2006 thanks to better distribution, but the rise hasn't made up for the decline in CD sales, the International Federation of the Phonographic Industry (IFPI) said on Wednesday.

Revenue is expected to come in at US$2 billion for the year, accounting for about 10 percent of the total music market, the IFPI said in its Digital Music Report 2007.

So we've got a few things to wonder about. My first reaction was that the ability to select individual songs is in large part responsible for the dive, and that albums had a bit too much crap on 'em, which would also suggest the price for newly released money tracks is probably a bit too low on iTunes.

This, of course, is overly simplistic and hardly explains what's going on. Later in the article, they say, "Overall, however, [International Federation of the Phonographic Industry] said a relatively low level of music stored on [mp3/etc players] devices had been purchased."

The basic issue seems to be this -- record companies' choice to move from cassette to the CD made for easily digitized, and therefore now very easily tradeable music. The cat is out of the bag.

Now does something like the iTunes Music Store, for whatever reason -- for the availability of music, for the appearance of legality/legitimacy it provides for the players and iTunes, probably the most common way of ripping those files, whatever -- sell so many more players that the online distribution is [via its introduction/sale of more nodes to hold these ostensibly largely pirated goods] contributing to piracy more quickly than the income it makes back up? If so, perhaps it's time to try to close digital distribution systems down [from the point of view of record labels]. You know, if it weren't for car players, perhaps record co's would have a better time of it chunking the CD and going back to vinyl.[1] And don't give me the "Microsoft's renting system is better." After it was cracked, users could grab and keep as many songs as they liked. With iTunes, it's one 99 cent song at a time, in a sense. I believe we've covered that before.

If revenue is 10% of the total, I'm guessing that digital online music distribution, still in its relative infancy, is likely putting more money in their pockets. Squeaky wheel still gets the grease, however, so I wouldn't expect the whining to stop.

What might be the most interesting experiment suggested by this jive would be to get on Limewire, etc, and start reading ID3 tags. If my guess that iTunes is the preferred ripper for pirates is on the money, well, Apple might have a harder time keeping the easy road from CD to iPod open, and may very well see themselves paying a tax per unit similar to what's paid for blank cassettes.

By the way, isn't it about time that tax went away? Seriously, who is using cassettes to pirate music anymore? Really?

[1] This is, you may have guessed, something of a modest proposal.