New market report cites deep record label woes.

In a period of lackluster sales, illegal downloading isn't the only factor affecting the depressed music industry. Disgruntled consumers have contributed significantly to the decline in retail music sales, according to market research conducted by Mintel. Retail music sales, valued at $12.5 billion in 2005, are predicted to fall to $10.5 billion by 2010. Mintel notes the major labels have been slow to listen to consumer needs. Justin De Santis, an analyst for Mintel, cites" lawsuits against individual consumers, payola practices, and restrictive use of digital rights management." Music labels have a negative stigma to overcome, brought on by battles against illegal downloaders, radio "pay-for-play" scandals, and homogeneous artist offerings on radio stations. The introduction of iTunes and similar sites has slowed the decay of music retail sales, but it has not stopped it. Even though technology is starting to work for the industry rather than against it, labels still face the challenge of meeting the demands of a diverse consumer marketplace.