Thursday, April 01, 2004

Is file-sharing destroying the music industry?

By now we've all heard the rhetoric of digital "piracy", according to which an mp3 shared is equal to a single sale lost by the industry. There are all kind of logical problems with this - for example, is it necessarily true that if a person downloads a track out of curiosity or to explore a new genre, they are getting something for free that they would have otherwise gone out and bought?

Well, it seems the mainstream media is now listening to academic research that questions this "downloading is destroying record sales" rhetoric - a rhetoric which up until now has been successfully deployed by the RIAA in their lawsuits and PR campaigns.

From pro-technology magazine Wired:
Researchers at two leading universities have issued a study countering the music industry's central theme in its war on digital piracy, saying file sharing has little impact on CD sales.

"We find that file sharing has only had a limited effect on record sales," Felix Oberholzer-Gee of Harvard Business School and Koleman Strumpf of University of North Carolina-Chapel Hill said in their report. "The economic effect is also small. Even in the most pessimistic specification, five thousand downloads are needed to displace a single album sale."
Read the full article here.