This was report-card week for the global recording industry as they issued reports on music sales for 2006. Lost among the various headlines (Howard points to 10% growth in Canada; press reports talked about the IFPI targeting ISPs) is a far more significant development. Canada was among the fastest growing digital download markets in the world, outpacing the United States and Europe. Last week, CRIA President Graham Henderson was telling the media that the Canadian digital market was not taking off and that "people are simply abandoning the marketplace altogether, and they've made the decision they'll just download the music and worry about how the artist gets paid later."
Not so. Canadian digital download sales grew by 122 percent last year, increasing from 6.7 million to 14.9 million (digital albums increased by a similar percentage). By comparison, the U.S. grew 65 percent and Europe by 80 percent. These are the industry's own numbers – far from abandoning the digital market, the Canadian market is growing faster on a percentage basis than the United States and Europe. CRIA would no doubt respond that the Canadian market is starting from a much smaller base and thus has more room to grow. That may be true, yet the data suggests that the Canadian market is showing similar growth traits as those experienced in the U.S. iTunes debuted in the U.S. in April 2003 and sales were relatively modest in that first year with 19.2 million tracks sold in the last six months of that year. The big growth occurred in iTunes third and fourth year as the numbers jump from 143 million in 2004 to 582 million last year. The Canadian market is nearly two years behind the U.S. as iTunes debuted in December 2004 in Canada. The first year sales were also relatively modest, followed by dramatic jump last year. Considering the more limited selection and the absence of television downloads, the only credible conclusion is that the Canadian market is performing very well.