Internet piracy has cost the British music industry more than £1 billion since 2003 and is continuing to rise as hard-core downloaders show little interest in giving up their track-sharing habits, according to industry figures.

A report from the British Phonographic Industry suggests those people who would otherwise spend the most money on music have now become used to illegally downloading tracks for free.

The trade body said that, despite the growing popularity of legitimate online music stores, more than three-quarters of downloaders are still willing to risk large fines to use illegal services.

The BPI data came as its global counterpart, the International Federation of the Phonographic Industry, launched almost 2,000 cases of legal action in 10 countries across Europe and in Hong Kong.

But despite a string of similar crackdowns - against both individuals and file-sharing sites such as Napster and KaZaA - comitted pirates are increasing their activity, posing a dilemma for music executives who are relying on digital music to bolster a worldwide fall in overall sales.

The BPI said that the amount of money lost to piracy increased to an estimated £414 million last year, from £376 million in 2004. Combined with a £278 million loss in 2003, the industry had now lost £1.1 billion in the past 36 months, it said.

While the percentage of downloaders using only legal services has doubled from 11 per cent in 2004 to 23 per cent in 2005, 46 per cent of downloaders do so only illegally.

Peter Jamieson, the BPI chairman, said: "Too often people believe that when they take music illegally over the internet it is a victimless crime. But when people share music files illegally, they are stealing the future of British musicians and the people who invest in them.

"The battle against illegal file-sharing is a battle for the future of British music."

However, the BPI added that the prospects for Britain's online music business remain promising. The UK's digital music business was worth around £39 million in 2005, according to international comparisons released by the IFPI last week. This is bigger than Germany and France combined.

Underscoring the growing popularity of legal downloads, they are now included in the UK Top 10 singles charts. On Sunday Gnarls Barkley's "Crazy" became the first song to reach No1 solely on sales of computer downloads.

The BPI has settled more than 100 of the 138 cases it has brought against alleged UK file-sharers, with several cases resulting in fines totalling thousands of pounds each. Four cases have gone to court

BPI general counsel Roz Groome said: "All the cases that have made it to court have ruled in our favour. Litigation will continue to be an important part of our campaign against illegal file-sharing."

Why do otherwise law-abiding people think it's fine to steal music? Have your say here.

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