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The agency responsible for handling France's "three-strikes" regime, Hadopi, has released a new report that claims web piracy has been dramatically slashed in the country following the introduction of the controversial law. However, statistics released by the country's music industry shows not only did revenue not grow as a result, it actually shrank compared to a year ago.

The report, written in English, showed that French web visitors visited pirated websites 29% less in 2011 than compared to 2010. With two sets of independent metrics being referred to in the report, one study found a whopping 66% drop in illegal file-sharing traffic, while the other set of statistics showed a smaller, but equally significant 43% decline in piracy related P2P traffic.

And with the closure of popular music sharing tool LimeWire in late 2010, along with these stats, it all points to a significant victory in the war against piracy for the music and movie industries in France.

But that victory may very well be hollow, as both industries reported that revenue in 2011 actually declined compared to 2010. Recorded music revenue fell 3.9%, while the movie industry saw a 2.7% decline in the same period. The drop in revenue for France's music industry actually exceeded the global average of 3%, according to stats released by IFPI back in January.

Ironically, the introduction of free, legal alternatives to piracy, such as Spotify, seems to be helping with the growth of digital music revenue, as well as concert attendance. Previously highly profitable CD sales continued to decline as the digital shift continues, and this accounted for most, if not all, of the industry's losses. 

The same trend is occurring for the movie industry as well, with physical disc sales on the decline, and purely digital streaming on the rise - VOD revenue increased by 50%, according to the latest statistics.

It appears then that piracy plays a very little role when it comes to revenue, at least according to these sets of figures, and that losses are largely down to the "disc to digital" phenomenon that's happening all around the developed world, including France.