P2P doesn’t affect music sales, you bozos
Contrary to what RIAA would have you believe, an evolving study published on the Journal of Political Economy finds no correlation between music downloads and declining record sales, and actually concludes that “file sharing probably increases aggregate welfare for the music industry”!
Ars Technica reports on the study’s conclusions:
Using detailed records of transfers of digital music files, we find that file sharing has had no statistically significant effect on purchases of the average album in our sample,” the study reports. “Even our most negative point estimate implies that a one-standard-deviation increase in file sharing reduces an album’s weekly sales by a mere 368 copies, an effect that is too small to be statistically distinguishable from zero.
The study isn’t exactly new, as Ars claims. It’s been aired before, in March 2004 and June 2005, but was updated last December to reflect new data available. Previous versions produced much the same results, which were predictably dismissed by the music industry. It seems to be a fairly sophisticated study, too, so it can’t be contested without rigorous and lengthy research (translated: RIAA’s PR tricks can’t easily shoot it down):
what the researchers wanted was a way to test for effects on albums sales when file-sharing activity was increased on account of something other than US song popularity. Does the occasionally increased availability of music from Germany affect US sales?
The study looked at time periods when German students were on holiday after demonstrating that P2P use increases at these times. German users collectively are the #2 P2P suppliers, providing “about one out of every six U.S. downloads,” according to the study. Yet the effects on American sales were not large enough to be statistically significant.
A helpful Slashdot reader points out some interesting details to focus on:
For those of you interested in the data, pages 34 on contain some very interesting data whereby downloads are broken down by song, album, country & genre (in case everyone was trying to pin illegal downloads on those damned teeny boppers).
For those of you who wish to question the sample size, see Section B. “File Sharing Data and Album Sample” of the paper. You will also be interested in reading Appendix A in which they call into question their own sample sizes and weigh in on how accurate they might or might not be.
The authors also manage to catch RIAA on it’s baldfaced lies that enabled it to wrangle legal arguments all over the States and Europe for the past 4 years and strangle P2P networks one after another:
The study reports that 803 million CDs were sold in 2002, which was a decrease of about 80 million from the previous year. The RIAA has blamed the majority of the decrease on piracy, and has maintained that argument in recent years as music sales have faltered. Yet according to the study, the impact from file sharing could not have been more than 6 million albums total in 2002, leaving 74 million unsold CDs without an excuse for sitting on shelves.
Besides RIAA, who’s looking for excuses when the root causes are self-evident?
First, because the recording industry focuses on units shipped rather than sold, the decline can be attributed in part to reduced inventory. Gone are the days when Best Buy and others wanted a ton of unsold stock sitting around, so they order less CDs. The study also highlighted the growth in DVD sales during that same period as a possible explanation for why customers weren’t opening their wallets: they were busy buying DVDs.
As anyone who really paid attention to the music wars already knows, a slew of other causes have also contributed to the sales slump. Besides the fact that the audio CD has long fallen out of preference as the standard bit bucket to carry tunes around in, the music industry had steadfastly refused to heed calls for decreased CD prices from music lovers worldwide, and the Sony Rootkit debacle last year undermined consumer confidence even further. RIAA’s latest blunder -falling hand over feet over an imagined offer by Steve Jobs to license FairPlay- only serves to highlight how delusional the powermongering lobby really is. That’s probably why single-mindedly killing P2P -the goose that paints their eggs golden -has become their number one priority over the last few years: if they were capable of acknowledging reality, they’d be forced to admit that the music industry’s long-term sustainability depends on their earnest efforts to overcome pure greed and actually work for a living, keeping their artists creative and original -and thus their customers happy- and getting with the open (no DRM) mobile media transition program.
Now, if we could only convince Messrs Strumpf & Oberholzer-Gee to run a similar study for movie downloads, so we can begin to get the MPAA off our backs too…
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