study: downloads don't hurt music sales
 

http://www.newscientist.com/news/news.jsp?id=ns99994831

Net music piracy 'does not harm record sales'

18:28 30 March 04

NewScientist.com news service


Internet music piracy is not responsible for declining CD sales, claim the researchers behind a major new statistical study.

Felix Oberholzer-Gee at Harvard Business School in Massachusetts and Koleman Strumpf at the University of North Carolina tracked millions of music files downloaded through the OpenNap file-trading network and compared them with CD sales of the same music.

The music industry frequently claims that illegal file-trading is responsible for reducing legitimate music sales. The industry says this argument is the reason for their legal campaign of suing individual file traders over the past year.

However, the researchers conclude: "At most, file sharing can explain a tiny fraction of this decline."


Automatic monitoring

Oberholzer-Gee and Strumpf monitored 680 albums, chosen from a range of musical genres, downloaded over 17 weeks in the second half of 2002. They used computer programs to automatically monitor downloads and compared this data to changes in album sales over the same period to see if a link could be established.

The most heavily downloaded songs showed no decrease in CD sales as a result of increasing downloads. In fact, albums that sold more than 600,000 copies during this period appeared to sell better when downloaded more heavily.

For these albums each increase of 150 downloads corresponded to another legitimate album sale. The study showed only a slight decline in sales as a result of online trading for the least popular music.

"From a statistical point of view, what this means is that there is no effect between downloading and sales," say Oberholzer-Gee and Strumpf.

Adverse impact

The Recording Industry Association of America (RIAA), which represents the world's largest record companies, point to a number of studies suggesting a between declining record sales and the growth of illegal file-trading.

For example, a series of surveys conducted by Houston-based company Voter Consumer Research have indicated that those who download more songs illegally are less likely to buy music from legitimate retailers.

"Countless well respected groups and analysts have all determined that illegal file sharing has adversely impacted the sales of CDs," says RIAA spokeswoman Amy Weiss.

But at least one other survey has already suggested precisely the opposite. And the new UNC study differs from previous work in its focus on individual album sales and its large scale. During the data gathering stage, the researchers tracked a total of 1.75 million downloads, or 10 per minute on average.

Dramatic Tactic

The RIAA has led recent efforts to crack down on illegal online music trading. The association's most dramatic tactic has been to track down hundreds of individual file sharers and sue them for copyright infringement.

The approach was adopted after a US court ruled that the companies providing file-trading networks could not be held responsible for the actions of their users.

Opponents of these legal tactics, including some consumer groups, musicians and academics, have accused music industry of failing recognise the potential of file-trading as a legitimate music distribution method.

In their paper, Oberholzer-Gee and Strumpf suggest that falling record sales may be partly explained by a weak US economy as well as increasing CD prices.

Evolution will bring music from Vinyl to digital. and it will stay there. And theres no way to control digital content.

The music business is fucked unless they find a way to
give illegal music the same status as CP.

never happen

my guess as well.. so big music corporations as we know it.. and big stars like britney is a thing of the past.

The future will be about real artists with real music making a living from performances and merchandise : theres no other option when fastfood music inst a multi billion industry anymore.

No offense to the lads at Harvard, but that summary isn't helpful at all.

I think you would need detailed demographic data on the file-sharers to draw any meaningful results.

It seems they made a rather large assumption that downloads today would affect today's sales.

That probably is NOT the case. A user downloads songs from an album today, rather than buying the album later. So, buying the album at a store is not a good substitute for having something right now.

That is to say downloading saves the user time and money, not just money.

My hypothesis is that music file-sharing impacts digital sales, but there are effects over time.

It would be interesting to do the same study with NEW albums, so the effect of the proliferation of files across sharing systems in conjunction with the release could be studied.

Nice to know this! :thumbsup

Do you really think ppl will read all that??

Come on.... I bet that I know what is written only reading the title.... :glugglug

The statistics seem to be based around album sales, which are obviously less affected than single sales.

Singles are being absolutely decimated by the ease by which people can obtain MP3's of the latest hits... hence the introduction of special features and additional tracks on them...

The RIAA is probably going to have to just keep doing as they are now, making P2P a bit of a legal minefield, suing people occasionally and flooding it with fake files, hopefully degrading its use to the average user and making it seem like an easier option to just buy the songs they want.

Just my :2 cents:

putting the power of distribution into the hands of the consumer and artists is going to help bring music back to an art form

and here's the proof

Australian recording industry tries to conceal record breaking sales and in the UK to.

damn I always knew it...thx 4 the information guys...

This was proven a long time ago. But the RIAA still blames music downloads for the declining in record sales. Damn RIAA the reason why noone buys music now-a-days is because they are so damn expensive. Who the hell would pay $25 for a damn CD. CD's should cost no more than $15.00

You poor guys. Thanks to A&B Sound, Vancouver has the lowest CD prices in the world. $8 USD for a new release :)

Music doesnt mean much to me, if I couldnt download it from a friend, I wouldnt be listening to it. Simple as that.

The internet allows people who normally wouldnt listen to music, to listen to it. And this obviously would convert some people to buying the CDs.

Go look at TGPs and paysites.

For every 150 people that dont pay, there is always one that does.

If I could get new releases under $10 I would buy a ton more music. Who has the time to download shit these days anyway.

the price of a cd should reflect the lowered cost of production that has resulted from advancing technology, the market is merely forcing this to happen