AfterDawn: News

Sharing doesn't kill CD sales, says study

A study made by researchers Harvard University and the University of North Carolina has shown that illegal music downloading doesn't translate to reduced CD sales. The study tracked music downloads over a period of 17 weeks in 2002, and even high levels of swapping appeared to have noeffect on album sales.

"We find that file sharing has only had a limited effect on record sales," the study's authors wrote. "While downloads occur on a vast scale, most users are likely individuals who would not have bought the album even in the absence of file sharing."



The study is the first ever to combine statistical data from a P2P network and actual record sales figures. Harvard Business School associate professor Felix Oberholzer and University of North Carolina, Chapel Hill associate professor Koleman Strumpf used statistics logs from two OpenNap servers in late 2002. The logs included about 1.75 million downloads over the 17 week period.

The music industry has been persistant in accusing P2P file sharing for the declining CD sales, while the fact remains that people are spending more money on, for instance, games and DVD-movies, as well as other types of entertainment.

Source: News.com

Written by: Jari Ketola @ 30 Mar 2004 7:42

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• 22 comments

• DrdigitaL

  please foreword to the RIAA, MPAA

  30.3.2004 09:17 #1

• brian100

  I am not surpised by this news at all. Perhaps the RIAA will now take a look at the quantiy of crap that is being peddled as music these days. After all better music means larger sales, but these smucks are too dumb, naive, greedy & stupid to realise that plain and simple fact.
  
  Ps I never download music of any kind, illegally or legally !!

  30.3.2004 09:54 #2

• sly_61019

  This study will have no effect on the RIAA.

  30.3.2004 11:12 #3

• bloke2000

  Sometime I do download music, however I don't think I have ever downloaded something I would actually buy, If there is something I really like I will buy it.
  
  Therefore there must be come substance to this study.

  30.3.2004 11:30 #4

• bloke2000

  Above should read 'some substance' not 'come substance', that was a genuine mistake.

  30.3.2004 11:32 #5

• Nephilim

  It's amazing to me that they have to conduct a study to arrive at the very same conclusion that common sense dictates - the more music people have easy access to, the more they will find and likely purchase. I thought that was the whole point of radio.
  
  Unfortunatley this will have absolutely no effect on RIAA as sly_61019 pointed out. They are so greedily single-minded that they won't accept anything suggesting that their business model truly is obsolete.
  Quote:take a look at the quantiy of crap that is being peddled as music these days.It takes too much time and dedication to foster true talent for RIAA. It's much easier to have a few writers who specialize in making bubble-gum crap music for an endless supply of air-headed tits and ass willing to be "the next big thing". There's a whole world of mouth-breathing morons out there ready to lap it up because they have no idea what truly good music is. It's really a pity.

  30.3.2004 11:32 #6

• brian100

  Nephilim Quote:It takes too much time and dedication to foster true talent for RIAA. It's much easier to have a few writers who specialize in making bubble-gum crap music for an endless supply of air-headed tits and ass willing to be "the next big thing". There's a whole world of mouth-breathing morons out there ready to lap it up because they have no idea what truly good music is. It's really a pity. I couldnt have put that better myself...nice one...sums it all up for me
  

  30.3.2004 12:22 #7

• Toiletman

  Finally a piece of news that is polite, true, and is not filled with bullshit. You see? There's no "RIAA" in it!

  30.3.2004 13:50 #8

• Dela

  Quote:The music industry has been persistant in accusing P2P file sharing for the declining CD sales, while the fact remains that people are spending more money on, for instance, games and DVD-movies, as well as other types of entertainment.Of course they have been persistant in blaming p2p file-sharing, its because p2p is like a whole new music industry, a technology that could make their labels unneeded for new artists, thats why they say all this stuff like, p2p is linked with childporn, operators of p2p networkls ruin a conspiracy to bring pornography to kids etc etc, they want to blacken p2p till its illegal, if they really gave a fuck about online music piracy, where were they when it really began? because it certainly didnt begin with p2p!

  30.3.2004 16:12 #9

• vurbal

  Honestly the RIAAs numbers already said the same thing. I'm not talking the numbers they like to publicize which have no direct relationship to sales, but the actual sales figures. I don't have anything from last year, but as of the 2002 figures (http://www.azoz.com/forms/2002yrendshipments.pdf) it's easy to see that CD sales were slowing before file sharing was even an issue.
  
  If you look at the top line of the chart you'll see the numbers that the RIAA likes to throw around in public, but those aren't sales numbers, they're units shipped. In other words if retailers order 50% less than the year before the number will be 50% of the previous year's figure even if the same amount of units are sold. If you look at the bottom line you'll see the actual sales. Unfortunately this document doesn't go as far back as I'd like (to make it easier to demonstrate the actual numbers), but it's very clear that in the 2 years before P2P took off sales were already slowing.
  
  And of course you'd expect that to happen for a number of reasons. By the late 90's most people who were switching from vinyl or tapes to CDs were pretty much done replacing whatever they were going to replace. Besides that, DVD sales were starting to take off and people went from replacing old music to replacing old movies. More importantly, the initial slowdown happened when the economy, particularly in the US, was booming. Should we be amazed that sales drop a little when people don't have jobs? Most business would have killed for the minor loss of revenue that the recording industry experienced.
  
  Another, and possibly most important, fact that the RIAA doesn't ever mention is that in the span of a couple of years they dropped the number of new releases in the US by 2/3 (sorry - can't find the link I had for that one). I believe the number was 30,000 and went to 10,000. Wow - what a revelation. Nobody bought all that music they weren't making. Who'd have guessed? Of course during that same time, in Japan, where not only did they not decrease the number of new releases, but copying music is legal, they haven't seen the sales fallout they've experienced in the US. Yup, must be people sharing music who are at fault because otherwise they might have to think they did it to themselves.
  
  What really scares me about the whole mess is that I think, for the most part, they really believe what they're saying. Sure it's common sense to most people that if you have less money (bad economy) to spend on more things (DVDs and console games) and there's fewer of the things they used to buy (CDs) that sales numbers for the things they used to buy will drop, but I really think that most recording industry execs look at it like this:
  
  1) People are sharing music.
  2) Because of digital copying every copy is potentially identical to the original.
  3) Therefore it must be costing us money.
  
  If they look at it that way there's no incentive to actually analyze their own numbers, independent studies, or anything else that disagrees with their opinions.

  30.3.2004 17:14 #10

• Dela

  Excellent reply :-) *Applauds*
  
  I have often wondered myself too if they really believe that its p2p done the damage. They must know that it's not. However, I still stand by a theory that they see p2p as a threat to their future at the top of the recording industry. I mean, how can u get a song all the way around the woprld in a few minutes? p2p can do it! So for artists who are interested in having their music heard, p2p is an amazing tool they can use and free. So this is unacceptable for the RIAA because now you dont need to run to their billions of dollars and sell your copyright to them to get your music around the world! That might even explain why the RIAA would try legal "number fixing", in other words, just look at the sales difference but dont actually look at any other facts!
  
  Also, there is a severe lack of good music these days in my opinion! A lot of music now is to make a fast buck, lets be honest. And once again I believe its not just the artists at it, but I think musicians with true talent are being turned down by mainstream labels because their music wont have an affect on teenagers who apparently are the biggest buyers on music CD's!
  
  So the fact that RIAA exists has made music these days worse IMO and life very hard for musicians!

  30.3.2004 17:25 #11

• vurbal

  Oops. I believe I mistated the numbers of new releases. I meant 3,000 and 1,000 not 30,000 and 10,000.
  
  Dela,
  
  No question about it there are control issues. I'm sure that's also what's driving the recent changes to US copyright law that are gradually changing copyright terms from a reasonable number of years to allow the creator of a work to make money from it to an indefinite period to be extended whenever it runs out. Lawmakers are missing out on the whole point of intellectual property which is to encourage new works. Instead, copyright laws are increasingly moving towards a model that does just the opposite. After all, why should I pay more for new works when I already own valuable properties that no one else will ever have the ability to sell copies of legally.
  
  And of course the good musicians you're talking about are mostly in 2/3 that aren't getting released now. And of course they don't care as much about those of us who will actually discriminate between what's good and what's just on the radio, preferring to focus instead on consumers who buy whatever their local radio station plays. And that group is, as you correctly point out, mostly teenagers.
  
  The real burning question now is what do we do about it. Obviously most of the lawmakers who haven't already been bought and paid for by the industry just plain don't get it, so there doesn't appear to be any serious chance of legal reform, so what we really need to do is to give as much financial support to those people who are making and selling quality music. Whenever I hear a good band with no major label support I try to go out of my way to buy a CD or a T-shirt or whatever I can to help them. When I find a independent label release with some potential I'm more than happy to pay for it. My interests may not matter to the lawmakers, but I can still vote with my wallet, and in the final analysis that's the best way to give the old one finger salute to the RIAA.

  30.3.2004 18:31 #12

• Dela

  The only real thing that can be done is a boycott of Music from Major labels. Of course that has some serious flaws like, how many people may lose their business/job because of a boycott or it may force the major labels into a corner where they take severely rediculous legal action and use their money to win. It's an ugly situation really but I am already boycotting and I would still suggest others do! How could one sue their own customer and then expect that he will buy a cd from them in the future? It makes no sense! All it really does is prove another point i made on my own thread - The RIAA are making business out of lawsuits. People settling for $5,000 probably would never have spent $5,000 on CD's in 10 manybe 20 years, so they are profiting on every single person they take action against! Once again proving their main goal as head of the recording industry is money and not music! So it's all completely backwards.
  
  It would seem like a defeat but another approach would be for p2p united to completely stop p2p activity and challange some of these laws and accusations in court, that way, with p2p offline, courts/governments may decide not to criminalise p2p till they've heard what p2p united have to say! The RIAA are seriously outside the law with even just the accusations they make about the "operators of p2p" and their "conspiracy to lure kids to pornography". These absolute lie's also prove my point that p2p is their main goal, they want to kill it no matter what it takes, i'd doubt the pirated music is anywhere near the no.1 priority!
  
  Anyways, enuff of that, its 05:42am here, i gotta grab some sleep :-)

  30.3.2004 18:43 #13

• seamonkey

  can i get an amen to dela! amen! they are just trying to kill p2p..
  agreed..
  
  i say... if the d@mn industry would have a lil forsight and a marketing scheme geared up for the digital age not the 80s.. they'd be sitting pretty phat.. if they would have ever offered any song from their whole library/group for $1, hell they would have boosted sales like a mofo; i'd do it..
  
  yea, i know itunes, but i want an unrestricted mp3 that i should be able to play anywhere on any medium...
  just this geeks .02...
  peace
  seamonkey420

  30.3.2004 19:59 #14

• Dela

  iTunes is just the same man, mostly mainstream music or am I wrong?

  31.3.2004 13:08 #15

• GrayArea

  There's one point that has been lightly touched upon in this thread that I feel is very important. Before the RIAA decided to get all $hitty about it, P2P was a risk free way for people to try out an hear music they would have never been exposed to in any other way given the sad state of radio these days (in the USA anyway). It is a no-brainer to conclude that this exposure would lead to CD sales. So, one could say that P2P may actually stimulate music sales. If the RIAA knows P2P is not a real threat to gross CD sales numbers then it leads me to believe that what is such a problem for them and what they are loosing is control of the market. The cabal between the big broadcast media outlets and the big 5 music labels had a pretty cozy deal going before P2P came along. They had their little stable of superstar acts to market and sell and unless you were willing to work at it you never even knew any other music existed (for practical purposes). They make way more money off one act that sells 10 million units than 20 that sell a half a million a piece. Now the cat is out of the bag. GREED & CONTROL. IMHO that’s all it's about.

  1.4.2004 09:42 #16

• Dela

  True! In fact, isnt it true apparently that for some emnem album some songs leaked a while before the album itsaelf came along, and it made record sales, if that's true (seen it on a documentary, i think it was attack of the cyberpirates!) eminem should be thanking p2p, not dissing the people who put it on the net in the first place!
  
  You also have th same view as me, the big 5 have had it easy till now, they are afraid of the internet becoming a massive music business for everyone and not just them anymore! In fact, i believe they see the average person as dumb and they probably think that most ppl will think that if p2p ends that damn, music just cant be got from the net anymore! then artsists will believe the big 5 are their only way!

  1.4.2004 16:38 #17

• ookami

  Since when has the RIAA let FACTS get in the way of their "vision"? Hmmm... much like Bush... =)

  2.4.2004 12:07 #18

• Oriphus

  On personal experience if i find a good song ive dowloaded, chances are ill download a few more and if i like it ill go get the album from HMV
  

  For your DVD needs http://www.dvd-and-media.com
  http://www.dvd-backup.tk
  For User Guides/Downloads: http://www.chrismccann.co.uk/user_guides.htm
  

  2.4.2004 12:32 #19

• Dela

  Ye I used to do that too, now i dont download music at all because I aint gonna buy the cd's anymore, ill buy from independent artsists instead and try to support them anyway they can :-) Mad waiting now for Bill to complete his next album, in which myself and darthnip will once again be listed in the thank you notes :-) lol

  3.4.2004 04:25 #20

• Oriphus

  lol - good old Bill Loreno
  

  For your DVD needs http://www.dvd-and-media.com
  http://www.dvd-backup.tk
  For User Guides/Downloads: http://www.chrismccann.co.uk/user_guides.htm
  

  3.4.2004 12:22 #21

• Chiwi

  I have over 600 CDs in my collection, about 95% of which are originals. I've just recently started downloading music for 2 simple reasons:
  
  1. - I may like a certain song, but not the artist in general, so why am I going to fork out 20+ euros for a CD which will just sit on the shelf unplayed? I will copy the song onto a personal compilation and the original will sit gathering dust forever and a day. I may as well download the song and spend the 20+ euros on something I WILL play over and over again.
  
  2. - Take a look at some of the compilation albums available - 80s for instance. If you've got one, you've got them all! Yes, I do like 'Tainted Love' by Soft Cell (av. on ALL 80s compilations), but I also like 'Bedsitter', which got to number 4 in the UK charts, yet NEVER appears on an 80s compilation. I like 'The Killing Moon' by The Bunnymen (another over-used track) but I also like 'The Cutter' which, incidentally, reached a higher position than 'Moon' in the charts. And those are just two examples of many. Is it any wonder we're downloading and making our own 'alternative' compilations? The music industry ought to be a little more creative and a little less repetitive IMHO.
  
  All this in addition to what has been stated by other posters.
  
  Whinge over :)

  29.4.2004 01:46 #22