Digital music sales rising, but not fast enough

It's no secret that sales of music CDs are now in free-fall: In 2007 alone the market for physical CDs and music DVDs dropped a whopping 13 percent. Unfortunately for Hollywood types, while digital media is on the rise, it's not rising quickly enough: Digital song sales climbed 34 percent last year, but didn't make up the loss in sales of physical media.

All told, the music market dropped 8 percent in 2007 even after considering digital's rise. Don't feel too bad for the record labels—that's still nearly $20 billion in revenue—but production companies are in full on panic mode over the issue.

Is there a bright spot? Music sales have been falling for seven years running now, but USA Today notes that the drop-off may be coming to an end: The decline in 2008's numbers hasn't been nearly as bad as 2007's so far, and the economy is considerably worse off now than it was a year ago.

Naturally, piracy is taking the blame for the precipitous drop (one report says piracy cost the industry a whopping $5.3 billion in '07), but given the RIAA's utter lack of success in stemming piracy via lawsuits, the industry is starting to look to alternative sources of revenue to keep the turntables spinning. One idea, which is now being floated in Congress: Charge radio stations (or charge them more) for playing songs.

Who would've thought the long-suffering radio business would be seen as a cash cow and a savior for the music labels?

LINK: CD sales falling faster than digital music sales rise