Don't Blame File-Sharing For Slumping CD Sales, Study Says Exhaustive Harvard analysis says music industry's claims don't add up. by Joe D'Angelo While file-sharing continues to be blamed by the recording industry for slumping music sales, a new study conducted by the Harvard Business School shows that downloading has only a negligible effect on CD sales. "Downloads have an effect on sales which is statistically indistinguishable from zero," concludes the report, conducted with the University of North Carolina Chapel Hill. "Moreover, [the effect of file-sharing] is of moderate economic significance and is inconsistent with claims that file-sharing is the primary reason for the recent decline in music sales." Unlike many reports that have popped up on both sides of the file-sharing debate, Harvard's study is not a survey. Surveys may inaccurately reflect real behavior, especially when they require a participant to admit to an illegal activity, such as copyright infringement. Harvard's statistical analysis is based on observing 1.75 million downloads from 160 popular albums during 17 weeks in the fall of 2002 and determining whether sales of an album decline more sharply when that album is downloaded more often. So thorough was the research that minute factors, such as network congestion, song length and international school holidays, were taken into consideration. According to the worst-case scenario of the researchers' findings, it takes 5,000 downloads to reduce sales of an album by one copy. Using those estimates, CD sales would have decreased by 2 million copies from 2000 to 2002, when actually they dipped by 139 million copies. Meanwhile, for the top 25 percent of best-selling albums (with more than 600,000 copies sold), downloading went hand-in-hand with increased album sales. The Recording Industry Association of America, which claims the number of CDs sold in the U.S. fell from 940 million in 2000 to 800 million in 2002, uses different statistics to support its longstanding claim that downloading is a detriment. No one argues that the best-selling albums are also the most downloaded, or that the best-selling albums aren't selling as well as they used to. Sales of the top 10 best-selling albums of 2000 totaled 60 million copies. A year later, they fell to 40 million. In 2002, the sum was 3302, the sum was 33 million. If file-sharing had a negative effect on sales, the Harvard study postulates, the motion picture, software and video game industries — whose files are also heavily traded, albeit not as much as music files — would also be suffering. But sales in those arenas have been increasing. The Motion Picture Association of America reported U.S. box offices took in $9.5 billion, the second largest total in its history. DVD sales continue to increase, and the recording industry announced that CD sales are actually up 14 percent in 2004 compared with the same period last year. The report doesn't say that file-sharing is good for music sales. However, it points out that while some people may download albums instead of buying them, widespread use of file-sharing networks may foster discussions about new music in online chat rooms, which could then promote sales. Some downloaders may also use file-sharing to sample new music, making purchases depending on whether they like what they hear. The report also speculates on why the recording industry is in such dire straits, citing a decreasing number of album releases, competition from other media (movies, video games), a reduction in the variety of music on the radio, and a possible consumer backlash against the RIAA's ongoing litigation campaign. A similar sales slump was recorded in the late 1970s and early 1980s, while sales figures in the 1990s may be abnormally high since many music consumers replaced their vinyl and cassette collections with CDs. http://www.vh1.com/news/articles/1486060/2...equestid=604956
I didn't read it, because I can't be assed to, but I saw alittle section about downloaders sampling music, and then they go out and buy the CD(s). Uh yeah. I don't know about them, but I download the whole album. I mean, I was looking for some good Pink Floyd CD's to buy at Hastings today, and the one I wanted was $30. Granted it was a studio/live album, but still. It shouldn't be that much. No CD should be over $16. No music is worth $30, Pink Floyd or not. I don't give a #### if it's rare, it's not really that important. Oh, and as for the artists loosing money...who the #### cares?! The ones that we 'rip off' are VERY, VERY well-set for the future. I mean, do you think the average downloader is going to make Metallica go bankrupt? No. Every artist has their hardcore fans that will ALWAYS buy their CD's, no matter how ####. Artists are losing money, yeah. But it's not like they're losing millions a day.
I agree to you, in an extent. I have burned copies of Green Day, White Stripes and Pink CDs, and I don't feel guilty at all because these are all multi-platinum artists. But for bands like All Bets Off that are just barely above being "local" bands, I'm not gonna burn their CD, I'll buy it. That said, I refuse to pay more then $15 for a CD. But with the likes of Interpunk, Best Buy, and even Ebay that's not hard. Edit... I think that record labels need to adjust so they stop spending so much on recording and production. Yeah, good sound quality is great, but that doesn't mean you need to hire The Matrix.
in the case of extremely underground bands like you mentioned, I think downloading is good, because if MTV won't support them, there is always a free file-sharing program out there that will. the fans come for the CD's either way, multi-platinum or mutli-aluminum.
I agree that downloading is good, and in the case of ABO I wouldn't have found out about them if it weren't for downloading, since they rarely leave Cali. But, like I said, I guess I'm one of "the fans" who will always buy CDs
Yeah, CDs cost too much, burning them is way cheaper. Thanks to that article I no longer feel like I'm doing something bad by downloading.
Due to the fact that I have 56K, I can definately see where they're coming from on that one. Theres no way I'm gonna download a whole ####### album, each song takes me 25-40 minutes. And if I try out a couple songs from a CD that I'm interested in buying and like it, it definately increases my chance of heading out to the store and paying for it.
I don't know why people are all the sudden starting to feel guilty. Is it because the little millionare artists are losing alittle bit of money? File-Sharing has been going on for the better part of the 90s, and then it goes back to the 80s also. Of course, it was just called underground tape transfer or something, but it's always been going on. I don't know, I've never felt guilty about it. I think of it this way: Without us, the artists would be poor. So I say they, along with the RIAA, should piss off and let us download. We don't have to spend every single penny we get. Without us, they'd be nothing. They need us. They can't just keep issuing lawsuits. They WILL lose fans. They already are.
who cares if it's illegal? I don't think people care that it's illegal, it's the fact that entire families are losing their life savings. If the RIAA wasn't handing out lawsuits like they were candy, no one would feel guilty, I bet.
That's probably a big part of it, but I think a lot of it also has to do with the fact that the record industry plays it up to be this big thing, talking about how people are losing jobs, etc etc.
Ok so if everyone started downloading albums and didnt buy them because they dont want to pay the money, the Bands would make almost no money, they wouldnt be able to make music, therefore no bands exist. As for them being poor without us, downloading the albums instead of buying the CD's is making them just as poor except they paid to be poor.