Peter Jenner, a former manager of Pink Floyd and the Clash who is now secretary-general of the International Music Managers’ Forum, believes the growth of Apple’s iTunes and other online music stores does not make up for the loss of CD sales .

In a submission to the European Union, Jenner has called for a wide-ranging reform of music rights to reflect changing market realities.

“Consumers feel that music delivered online is more like radio than buying a record, and prices need to reflect that,” he said. “Like radio, music consumption online should feel free. If not, illegal or semi-legal music services will grow exponentially and there will be no income for the creators.”

Jenner proposes a move away from the current royalty system, and the introduction of a monthly charge on broadband and mobile-phone companies that facilitate music downloading. He said charges should be sufficiently low “so that no-one really notices”. He suggested a level of €4 (£2.67) a month.

The forum argues that a move to this kind of collective licensing is “inevitable”. Organisations such as the Performing Right Society already collect royalties based on estimates of what music is broadcast or played in clubs and theatres.

Ged Doherty, chairman of Sony BMG UK, said he expected CD sales to halve in value over the next three years. Digital sales were growing at an annual 25%, but this would not be enough to replace lost CD sales, he said.

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