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Hamburg (pte019/27.02.2003/12:34) - The German music market is struggling after turnover plummeted in the second year in a row.
In 2002 music CD turnover fell by 11.3 per cent to 1.97 billion euros and the number of albums sold dropped 7.6 per cent to 223.7m. This comes on the heels of a significant decline in 2001.
The German Phonographic Association (IFPI) http://www.ifpi.de reports that Germany has been especially hard hit by the crisis in the international music business. IFPI head Gerd Gebhardt attributes the industry's difficulties to online piracy and private CD burning devices. Gebhardt told the Financial Times Deutschland (FTD): "Compared to other countries there are many more CD burners in use here."
Gebhardt suggested that stricter copyright laws might provide a way out of the dilemma. The IFPI is also demanding that value added tax be reduced from 16 to 7 per cent for CDs. This would help the music industry to lower its prices.
At the same time Gebhardt dismissed general criticism of CD prices. He said one could not compare CDs with slightly more expensive DVDs, as DVDs were a by-product of the film industry while CDs comprised the core business of the music industry.
According to FTD statistics, turnover in CD compilations and singles has been most affected by online piracy, falling by 18.5 and over 20 per cent respectively.
The IFPI is further demanding that radio stations adhere to a "quota for more musical diversity". In this scheme radio stations would devote half of their airtime to newcomers and the other half to German artists.
Germany has fallen from third to fifth place on the ranking of international music markets.
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