Music sales took nose-dive in past decade

People didn't seem willing to pay for music until Apple's iTunes entered the scene in 2003. But that gap did irreparable damage to the industry, according to Sonal Gandhi, Forester music analyst told CNN Money.

"That four-year lag is where the music industry lost the battle," Gandhi said. "They lost an opportunity to take consumers' new behavior and really monetize it in a way that nipped the free music expectation in the bud."

Forrester says just 44 percent of U.S. Internet users and 64 percent of Americans who buy digital music think they should have to pay for music.

Illegal downloads represent about 90 percent of the digital music market, according to BigChampagne Media Measurement. 

The music industry has long struggled to find ways to deter unauthorized downloading and file-sharing. The latest proposal would suspend a consumer's Internet access if they are caught violating copyright laws a certain number of times.