The struggling music industry could be seeing the first signs of recovery with figures showing online downloads more than doubled in Britain in the last week of 2007 compared with 2006, analysts believe.

The industry, which has been hit by illegal piracy, is looking to online sales to offset falling CD sales, and last week's figures were likely to have been boosted by consumers going online after receiving digital music players such as Apple Inc's iPods and music vouchers for Christmas.

Online music sales reached 2.9 million tracks in the last week of 2007, more than double that of the corresponding week in 2006 and the largest one-week sales tally recorded to date in Britain, the Official Charts Company said.

The BPI, which represents the British recorded music business, said total music download sales for the year topped 77 million, a 50 per cent increase on 2006 - contrasting with a drop in sales of CDs.

"In the United States for the week ending December 23rd, 2007, recorded music album sales - including the counting of 10 downloaded singles as an album - fell 10 per cent year to date, with physical album sales down over 14 per cent," analysts at UBS said in a note. "Other markets such as the UK and in continental Europe have also seen tough conditions."

But UBS said the British Christmas sales figure should provide a boost. "While online album downloads have failed to pick up, the news should help induce optimism that the recorded music industry may be seeing the roots of recovery."

In other good news for the industry, eMusic, a retailer of online music from independent labels, said downloads of digital music and audiobooks had smashed its expectations, reaching an all-time peak on Christmas Day with nearly 500,000 downloads. It also pushed past the 400,000 paid subscriber mark, less than two months after the company announced it had reached 350,000 subscribers.

- (Reuters)