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Digital music research firm The Leading Question found that they spent four and a half times more on paid-for music downloads than average fans.

Rather than taking legal action against downloaders, the music industry needs to entice them to use legal alternatives, the report said.

According to the music industry, legal downloads have tripled during 2005.

In the first half of 2005, some 10 million songs have been legally downloaded.

Music 'myth'

More needs to be done to capitalise on the power of the peer-to-peer networks that many music downloaders still use, said the report's authors.

There's a myth that all illegal downloaders are mercenaries hell-bent on breaking the law in pursuit of free music Paul Brindley, The Leading Question

This compares to just £1.27 spent by other music fans.

"The research clearly shows that music fans who break piracy laws are highly valuable customers," said Paul Brindley, director of The Leading Question.

"It also points out that they are eager to adopt legitimate music services in the future."

"There's a myth that all illegal downloaders are mercenaries hell-bent on breaking the law in pursuit of free music."

In reality hardcore fans "are extremely enthusiastic" about paid-for services, as long as they are suitably compelling, he said.

Carrot and stick

The BPI (British Phonographic Industry) welcomed the findings but added a note of caution.

"It's encouraging that many illegal file-sharers are starting to use legal services," said BPI spokesman Matt Philips.

"But our concern is that file-sharers' expenditure on music overall is down, a fact borne out by study after study.

"The consensus among independent research is that a third of illegal file-sharers may buy more music and around two thirds buy less.

"That two-thirds tends to include people who were the heaviest buyers which is why we need to continue our carrot and stick approach to the problem of illegal file-sharing," he said.

Music to go

The Leading Question survey also asked 600 music fans what devices they would be buying in the next year.

One of the challenges will be to develop the perception of the phone as a credible entertainment device Tim Walker, The Leading Question Q&A - Will I be sued for music swapping?

Reasons cited for not purchasing a music playing phone included worries about battery life and concerns about losing the handset, and potentially their music collection.

The fact that phones tend to be frequently replaced also meant people had a low emotional attachment to them.

"The phone is not ready to replace the iPod as a serious digital music player just yet," said Tim Walker, director of The Leading Question.

"One of the challenges will be to develop the perception of the phone as a credible entertainment device," he said.

Providers need to look at features such as dual download to mobile and PC, back-up facilities and improved interfaces between PC and mobile, he said.

There is a huge potential market for MP3 phones. The survey found that 38% were interested in downloading full tracks to their mobile phones.

And people are happy with the storage possibilities of phones with only 4% wanting to store more than 1,000 songs to take on holiday.