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Copyright News: File Sharing and Sales Figures

Posted by: , 17:00 AEST, Wed March 31, 2004
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Recent studies and figures may prove once and for all that online file sharing has no effect on lost record sales ...
The decline in CD sales due to file sharing is an idea that the Record Industry of America (RIAA) and similar organizations around the world have been trying to promote. Large "lost sales" figures are quoted, and often, based not on actual lost sales but "potential" lost sales (that is, the number of sales if everyone that pirated a song on the Internet bought the original CD. However, a few pieces of news release today cast a shadow on the RIAA's claims.

First up, we have a study jointly by researchers from Harvard Business School and the University of North Carolina, Chapel Hill, has found that music sales in 2002 were not affected by file sharing. The academics concluded that, "file sharing had no effect on the sale of popular CDs in the second half of 2002. While downloads occurred on a vast scale during this period - three million simultaneous users shared 500 million files on the popular network FastTrack/KaZaA alone - most people who shared files appear to be individuals who would not have bought the albums that they downloaded."

The second piece of news has record sales actually improving despite online file sharing. The news article in The Register provides an analysis of why music sales are down, and suggests online file sharing have no or very little effect on sales, which seems to back up the above study.

Perhaps the best and closest example is the sale of DVDs, which have been growing at an extraordinary rate (up to 90% in some areas), despite the availability of "DVD-Rips" from online file sharing sources. The same may also apply to movie ticket sales, which doesn't look like dropping despite the fact that pirated versions are available only hours after the first screening. And could the increased sales in DVDs have an effect on record sales? Not that the RIAA would admit it ...



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