Record labels finding fresh sources of cash

THE amount of money made by British record labels outside of traditional music sales has increased for a third successive year, offering hope that it will overcome the threat of illegal downloading.

Secondary revenues - those which do not include CD sales or digital music services - brought in 193.5 million in 2009, an increase of 6.6 per cent on 2008.

The sector includes income received for music played on radio, television and in pubs and clubs, as well as merchandising and the labels' share from concerts and touring. It accounted for just over a fifth of total industry revenue.

Geoff Taylor, from trade association the BPI, which released the figures, said it shows the record industry could transform itself in the face of the "enormous challenge from illegal downloading".

He said: "UK record companies have responded to tough market conditions by innovating in the digital world and developing new revenue streams from recorded music, beyond their traditional base of CD sales and the encouraging growth in digital la carte, subscription and streaming services.

"Music companies continue to face an enormous challenge from illegal downloading, but are responding positively by transforming themselves for the future."