Maybe the Music's Just Lousy? Reuters
Story location: http://www.wired.com/news/digiwood/0,1412,62871,00.html

10:28 AM Mar. 30, 2004 PT

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."

The Recording Industry Association of America, the trade group representing the music industry, was quick to denounce the report's conclusions.

"Countless, well-respected groups and analysts, including Edison Research, Forrester, the University of Texas, among others, have all determined that illegal file sharing has adversely impacted the sales of CDs," RIAA spokeswoman Amy Weiss said in a statement.

The music industry has blamed file sharing through services like the original Napster and Kazaa for a prolonged decline in CD sales. Last week the RIAA sued more than 500 people for online copyright infringement, adding to more than 1,000 similar such suits already filed this year.

The researchers sampled downloads in late 2002, using data from two OpenNap file-sharing servers that operated from early September through December.

They observed 1.75 million downloads in total, targeting the downloads by U.S. users, and used a complex series of measures to compare the songs downloaded to the albums on which they were released, while also looking at the weekly sales figures for those albums.

"While downloads occur on a vast scale, most users are likely individuals who would not have bought the album even in the absence of file sharing," they said.

The question of file sharing and its impact on music sales is one that has come up in academic circles in the past, especially as file sharing at universities is often cited by the music industry as a top culprit for lagging sales.

A study from University of Texas at Dallas professor Stan Liebowitz released last summer found some negative impact but said it was hard to quantify.

"My conclusions, in a nutshell, are that MP3 downloading does appear to be causing harm. No other explanations that have been put forward seem to be able to explain the decline in sales that have occurred since 1999," Liebowitz said, referring to songs downloaded to digital music players. "Still, it is not clear that the harm will be fatal."

The RIAA's own research found a 33 percent drop in music purchases by young adults who download music over a year earlier.



What personaly bothers me is when you listen to the news stories below it shows a totally different perspective. It says that in 2002 sales dropped by 7 % and in 2003 by 2% .....

News report from NPR
HERE ( realaudio ) HERE ( windows media )