The battle to stem pirate music appears to be failing as the total number of illegal CDs sold worldwide topped the one billion mark for the first time in 2002.
CDs can be bought openly on the streets worldwide
A report published by the International Federation of the Phonographic Industry (IFPI) shows that the illegal music market is now worth $4.6bn (£2.8bn) globally.
It believes two out of every five CDs or cassettes sold are illegal.
The IFPI said much of this money is going to support organised criminal gangs, dispelling the myth that it is a "victimless crime".
Jay Berman, chairman of the IFPI, said: "This is a major, major commercial activity, involving huge amounts of pirated CDs.
"What we have faced in the last three years is an explosion worldwide in the number of unlicensed optical disc plants."
The 10 priority countries
Peter Jamieson, executive director of the British Phonographic Industry (BPI), said that that one in three CDs sold in Britain was a pirated copy.
"If you factor in unlicensed downloads then only one in three music products in the UK is authorised."
Despite the increase in the amount of CDs illegally produced and sold around the world, up 14% on 2001, there has also been a rise in the amount of CDs and recording equipment seized.
The number of discs seized on their way for public sale was more than 50 million, a four-fold rise on the previous year.
For the first time the IFPI has published a list of the top 10 countries where it wants a crackdown on piracy.
There are two types of products that worry the industry, which tend to be concentrated in different regions.
Of the estimated total number of illegal music copies sold, 40% originate from factory production lines which produce professional-looking products but without paying any money back to the industry or artists.
Asia and Russia have been identified as hot spots for this.
There is also the growing problem of CD-R piracy, where albums are created using CD-burning computer software which can allow mass production relatively cheaply and discreetly.
Action was taken against Ukraine, including US trade sanctions which are still in place, because of its failure to bring an end to rampant piracy, but the problem has now moved across the border to Russia.
The IFPI predicts 32% of illegal products on the market are produced this way with Latin America and southern Europe identified as the biggest offenders.
Copied cassettes account for 20% of the total market but this is in decline as the demand for the format slides.
There was a global rise in the number of CD copying machines seized in 2002 from 4,000 to 7,000, with a capacity to produce 250,000 illegal discs.
The IFPI is now calling on governments worldwide to aid the fight against piracy by enforcing copyright laws and regulate optical disc manufacturing.
It also wants countries to aggressively prosecute offenders, seize their equipment and to seek compensation for copyright holders as a deterrent.