Internet service providers (ISPs) could generate significant amounts of revenue through legal music downloads, it has been reported.

Research conducted by Ovum on behalf of the British Phonographic Industry (BPI) indicates that if all Tier One UK ISPs - those which own their own networks - launched bundled digital music services in 2010, the market would be worth at least £103 million by 2013.

This sum would be equivalent to 41 per cent of the total retail value of the UK digital music market in 2009, the firm reported.

Ovum also found that bundled music services would help reduce the cost of ISP subscriber attrition, lowering overall expenditure.

Geoff Taylor, BPI Chief Executive, said the report shows that the revenue potential of digital music services alone makes "sound economic sense" for ISPs.

"UK music companies want to innovate and develop exciting new digital offerings. ISPs have recognised that legal digital music services offer a more exciting and profitable future than continued widespread piracy," he added.

Virgin Media recently announced that its new music download and streaming service will be called MusicFish.