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The illegal downloading market has undoubtedly adversely affected the physical music market, whilst constraining the growth of legal digital channels. We continue to plan for further declines in the physical music market, both as a result of piracy and the growth of legal digital channels, and to replace these sales with higher-growth entertainment products and by growing in live entertainment and ticketing.

HMV’s main retailing competitors entertainment are supermarkets, Amazon, Play.com and other generalist and mass merchant retailers. The largest single competitor in live entertainment is the combination of Live Nation and Ticketmaster.