I really wanted to get a some definitive statistics on Music piracy and it's impact on music sales loss and after trawling through so many pages all I could find was a conspicuous gap between the facts provided by pirates and anti pirates.On one side you have the International Federation of the Phonographic Industry and the Recording Industry Association of America teaming up with the republican party to draft policy to chase lost sales through digital piracy.On the other side there are plenty of consumers arguing that these lost sales are only hypothetical, since a pirate may buy digitally later.
To argue for the anti pirates:
-record sales have dramatically fallen, jobs have been lost due to piracy
-signing new artists is dramatically declining due to costs
-music stores are closing in freakish numbers
-musicians must supplement their incomes with other commercial ventures(touring,merchandise).
To argue for the pirates:
-while physical record sales,cd's etc have fallen off, digital music sales have increased, therefore the market loss is just a shift of sales from old format to digital
-it is impossible to measure the probable income of an artist since success is so variable,sales are not steady year to year
-a download does not constitute a lost sale since the pirate may buy later

The most I could establish was that while overall physical product sales have fallen 40%, digital sales are only growing at a 10% rate.So there could be a 30% loss at stake.
But this is only an observation of market growth, it is not a static comparison to constitute the gap in sales.Since so many variables influence sales; actual talent, distribution over time, there needs to be a control in the study; i.e. releasing encrypted music and downloadable music by the same artist in similar markets to measure a difference.
Further compounding the issue is that since the record companies have been so conservative in signing new artists in the last decade,purportedly due to losses, musiv has become homogenised and formulaic, and this could also explain a fall off in sales, a chicken or egg syndrome.


Even though the overall music market has fallen by around 30% since 2004 with sales down 12% in the first half of 2009, Digital sales have grown 940% since 2004[11]. Download sales of single tracks increased by an estimated 10% in 2009 to more than 1.5 billion units and digital albums grew more strongly, up by an estimated 20%[12]. The best selling track of 2009 was Poker Face by Lady Gaga, selling a total of 9.8 million units. By comparison, the best-selling single track in 2008, Lil Wayne’s Lollipop, sold 9.1 million units and in 2007 Avril Lavigne’s Girlfriend sold 7.3 million units[13].

There are four specific types of music piracy. The first type is pirate recordings, which are the unauthorized duplications of just the sound of legal recordings. This does not include the duplication of the original artwork, label, title, sequencing or the combination of titles. The second type is bootleg recordings/underground recordings, which are the unauthorized recordings of a musical broadcast on radio, television or of a live concert. Counterfeit recordings are unauthorized recordings of the pre-recorded music as well as the unauthorized duplication of original artwork, label, trademark and packaging. Online piracy refers to the unauthorized download of sound recordings from Internet sites[3].

http://indaltsound.wordpress.com/2010/04/05/in-depth-explanation-of-music-piracy/


A recent research study on the economic impact of music piracy (Institute for Policy Innovation, August 2007) paints a grim picture. The impact of music piracy to the U.S. economy is estimated at U.S. $12.5 billion annually. It is estimated that 71,060 jobs are lost or at risk due to the economic impact of piracy and the lost growth opportunities account for 26,860 jobs that would have otherwise been created in the recording industry. Even the U.S. government is affected by piracy with an estimated loss of $422 million in tax revenues from lost personal and corporate income due to piracy.
Of course, these figures are based upon the assumption that sales of recorded music on CD would have held constant, or increased, from year to year. The truth is, however, that CD sales are on the decline as MP3 players and other digital technology make the need for music on physical media obsolete.
In addition to falling CD sales, half of America’s independent record stores closed between 2003 and 2005. (NY Post). One of the largest international chains of recorded music sellers, Tower Records, closed its doors forever on December 22, 2006.

http://articlesss.com/music-piracy-and-the-new-musician/


Every year, RIAA’s global partner IFPI publishes a digital music report, which can be best described as a one sided view of the state of digital music consumption. For several years in a row the report has shown that the sales figures of digital music have gone up, but still, the industry continues to blame piracy for a loss in overall revenue.
One of the key statistics that is hyped every year, is the piracy ratio of downloaded music. Just as last year, IFPI estimates that 95% of all downloads are illegal, without giving a proper source for this figure. Interestingly, those who take a closer look at the full report (pdf), will see that only 10% of the claimed illegal downloads are seen as a loss in sales.

http://cyberlaw.org.uk/2009/01/18/music-piracy-not-that-bad-industry-says/