Worldwide music sales have tumbled to their lowest level since 1985, the year that Jennifer Rush topped the singles charts in Britain with The Power of Love and Dire Straits released Money for Nothing.

The equivalent of 1.86 billion albums were sold last year, counting ten sales of individual songs as the equivalent of one album, according to figures published yesterday by the IFPI, which represents music companies worldwide.

Album sales were down 11 per cent, from 2.09 billion, in figures that include paid-for downloads. In 1985, unit sales were 1.8 billion, as the CD began to increase in popularity, a run of growth that peaked in 1996 with sales of 3.4 billion.

The main cause of the decline continues to be collapsing CD sales, hurt by illegal copying, that are not being offset by growth in download sales. Record company revenues tumbled 8 per cent last year to $19.4 billion, after CD sales fell 13 per cent – more than offsetting the 34 per cent growth in the smaller digital business.

In Britain alone, revenues tumbled 13 per cent to £1.02 billion, with Amy Winehouse’s Back to Black as the top-selling album. Industry revenues from CD sales plunged 16 per cent to £871 million, while digital sales in the world’s third-biggest music market increased 28 per cent to £132.2 million.

Presenting the statistics, the IFPI called for internet providers to work with the music business to stop illegal copying. John Kennedy, its chief executive, said that between 50 per cent and 80 per cent of internet service provider traffic was accounted for by illegally swapped content.

The IFPI wants internet providers to reveal details of their customers who illegally share music and possibly cut off any subscriber who breaches copyright three times. Mr Kennedy said that providers should engage constructively, before the tools of legislation or litigation were invoked to require them to act.

Governments are beginning to look hard at copyright enforcement. Ministers have considered legislating for a “three-strikes” policy that could punish internet users with disconnection, but they want music companies to try to reach voluntary agreements with internet suppliers first.

Andy Burnham, the Culture Secretary, said that while regulation was not the first preference, he did not feel that he could stand by and ignore wholesale breaches of copyright. “British music is one of our biggest success stories. I don’t want to see it wasted away,” Mr Burnham told the Broadcasting Press Guild yesterday.

Music companies and lobbyists are trying to reach agreement with internet providers. This month Virgin Media agreed that it would write to consumers who were engaged in large amount of music copying, based on information supplied to it by the BPI, Britain’s record company trade body.

However, industry executives said that the gloomy data was nothing new. A spokesman for Vivendi’s Universal Music, the market leader, said: “This must be the tenth consecutive year we’ve read the obituary for the music business, but we are still here.”

We hummed

Top five songs in 1985

We Are The World — USA for Africa

Take On Me — Aha

I Want to Know What Love Is — Foreigner

Shout — Tears for Fears

Into The Groove — Madonna (based on worldwide chart positions)

Bestselling UK single: The Power of Love — Jennifer Rush (it did not chart in the US)

For the record

Top ten global bestselling albums of 2007

1 High School Musical 2 — High School Musical 2 (Walt Disney Records/Universal/EMI)

2 Back to Black — Amy Winehouse (Universal)

3 Noel — Josh Groban (Warner)

4 The Best Damn Thing — Avril Lavigne (Sony BMG)

5 Long Road Out of Eden — Eagles (Eagles Recording Co/Universal)

6 Minutes to Midnight — Linkin Park (Warner)

7 As I Am — Alicia Keys (Sony BMG)

8 Call me Irresponsible — Michael Bublé (Warner)

9 Life in Cartoon Motion — Mika (Universal)

10 Not Too Late — Nora Jones (EMI)

Source: IFPI (includes physical and digital formats)

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