Global music sales continue to fall but revenues from streaming and subscription services have topped $1bn (£600m) for the first time.
According to the International Federation of the Phonographic Industry (Ifpi), figures for 2013 show digital streams were up 51% globally.
It said streaming service Spotify now boasts over 24m users, while established players such as Google and Apple have also launched their own offerings.
However, Ifpi's Digital Music Report 2014 continued the industry's calls for an overhaul of search engine results, which it said can aid online piracy.
"Search engines have pledged to do more to tackle online piracy, but there is still a long way to go," the group said as it released the report in London.
"In August 2012, Google announced that it was altering its algorithm to take account of notices received from rights holders to place infringing sites lower down in search results.
"Unfortunately, this seems to have had little impact.
Ifpi added: "A search for the name of any leading artist followed by the term 'mp3' in the leading search engines still returns a vast proportion of illegal links on the first page of results."
As an example, Ifpi listed the leading five performing artistes from the Billboard 100 and said that copyright infringement pages appeared on searches from Bing, Yahoo! and Google.
Ifpi said that by last January, the global recording industry had sent in total more than 100 million requests to Google to remove links to infringing content.
It said the number of requests would have been higher but Google caps the number of requests on rights groups.
Approached by Sky News, a Google spokesman was unavailable for comment.
Mainstream search engine insiders question the Ifpi methodology, say they have taken millions of pirated content links off their portals and insist independent evidence down not back-up the piracy-support claims.
Ifpi lambasted Russian social network vKontakte, which it said allowed its 55 million average daily users to upload and share music and video files.
It added that the City of London's Police Intellectual Property Crime Unit (Pipcu), funded by the Intellectual Property Office, has taken a key role in targeting infringement of rights holders.
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