February 13, 2007  ·  Lessig

“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.”

Study here.

(Thanks, M.David!)

  • http://www.gigatribe.com Jane

    I download a lot, but still buy lots of albums, so I agree!

    They’re going to be powerless to stop file-sharing though, as a new breed of encrypted file-sharing apps are already exploding across Europe; I use GigaTribe for instance ( http://www.gigatribe.com ) since no ISP can trace or see what I’m exchanging…once these types of apps catch on, it’s only a matter of weeks before the RIAA lawsuits are a thing of the past.

  • ACS

    I think the article is a little dubious, to say the least, for example

    “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”

    Now how does that mathematics work?? How does the study say whether an album was purchased or not purchased because of or not because of P2P. THe article doesn’t outline that crucial calculation nor any other qualitative standard that may have been imposed.

    The figures themselves are a little daunting – Could it be that 80 million albums were not sold because consumers just didnt like the product?? If so music mus be pretty terrible these days (compared to the days of Wham when music sales were still climbing). For instance, in Australia, the Australian Recording Industry Association released these figures:-

    1995 – 7.6 million sold
    1996 – 8.3 million
    1997 – 10.83
    1998 – 9.9
    1999 – 11.3
    2000 – 11.2
    2001 – 12.3
    2002 – 11.3
    2003 – 9.4
    2004 – 9.2
    2005 – 7.5

    ARIA Stats at http://www.aria.com.au/pages/statistics.htm

    There appears to be strong growth (with the exception of 1998) until 2002. Now as the home of Kazaa (which began in 2002) Australians took up file sharing and continue to file share with the best of them. The trend became so prevalent with the public computers at Queensland University of Technology that the IT Section had to develop specific software to prevent Kazaa, grokster, morpheus et al from being installed and operating.

    I have nothing against legal file sharing either under CC or by the owners of copyright – however – it is pretty clear from the statistics that the rise of this technology has had an impact on the sales of legitimate albums.

    Who does this hurt? I hear you say. Well not the record companies – they can afford to continue producing the teenie bopper albums that make money. Its tha albums that arent sure winners that get cut off. The people this hurts are the artists in a niche – specialists that only attract a small portion of the community – punks, goths, heavy metal fans – the unpopular stuff. A diverse mix of alternatives that allows our culture to evolve.

    So next time you are satisfied with half baked studies and justify the illegal obtaining of information just think to yourself – Am I a struggling artist, do I know anyone that is??? DO I want to live in a hegemenous society where Kelly Clarkson is Queen?????

  • David Fedoruk

    I am afraid that all studies of this phenomenon are “half baked” because the one statisitic that you desparately need but have no way of getting, is the actual number of downloads of recorded music. A downloiad from anyone of the P2P systems could be a legal download, a faked file or the real thing. This also pre-supposes that all illegal donloads and trading takes place within the confines of a P2P network.

    Since the dawn of the CD era several things have occured which directly accects CD sales. First, the initial flurry of purchasing in this new better format (scratch and pop free) was people replacing their old collections. I worked in music retail during that period and I know for a fact that’s what people were doing. Sales dropped as people replaced all their old recordings. They were also not happy about having to pay again for something they had already purchased once. Frankly, even then, consumers were questioning the value of re-purchaing these items.

    Then in the 1990′s the PC became a very common household appliance with the coming of the World Wide Web. Many people left their music players for oither pursuits. Computer games affected CD sales, so did the Internet itself. People found they could intereact with each other in a way they could not before.

    There is simply no way to factor in all these variables and come up with the statement that the sharing of digital files on the Internet either increases or decreases music sales.

    I know one thing for sure, there is a certain portion of the population who think music is free and will never play for music, they never were customers of brick and mortar music retailers and will not be online either. You cannot say how large tht protion of the population is.

    I stopped buying CD within the last five years, not because I’m downloading music, its simply that I no longer have the disposable income to pay for it. So I’m one customer that isn’t purchsing music anymore.

    I haven’t noted any complaints from concert promoters that people are no longer attending live events so musicans have nothing to fear from recorded music .. either paid for or otheriwise.

    Mostly these days, I make my own music. I sit at the piano (mechanical, not electronic) and actually play the notes Beethoven, Scarlatti and Schumann wrote myslef. So I’m one of the people not purchasing CD’s in the quantities I used to — so take me out fo the statistic that says the downturn in CD sales is the result of file sharing. In my case, its the result of ecconomics and my own abiliity to make my own music.

    Pointing fingers at people and blaming them for the lack of sales won’t help. Foir the niche market, likelly fans of those groups would rather pay for the album than download it. I can tell you one thing, I value the packaging almot as much as the musical contents. You cannot look at a file on your shelf and admire your collection of digital files, they’re hidden on a hard drive.

    Blaming “pirates” is a way of excusing the major label’s bad marketing and their recent failures, and not based in any reality except one in some alternate universe.

    Cheers,
    David