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Illegal Music Downloads Not Hurting Industry, Study Claims

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It’s common sense: taking a thing that you used to pay for is not good for the people who created that thing. But when it comes to entertainment piracy, lots of folks—whether motivated by statistical curiosity, forward-thinking vision or a desire to rationalize their own law-breaking—have argued that things aren’t quite so simple. Now, with the release of a new analysis of 16,000 European music consumers, those on the side of piracy have evidence to back them up.

A few findings of the study — conducted by Luis Aguiar and Bertin Martins using Nielsen “clickstream” data, and released by the European Commission Joint Research Centre — confirmed assummptions: attitudes differed by country, and piracy definitely affects off-line music sales.

But one was startling: illegal music downloads, they discovered, had essentially no effect on the number of legal music downloads:

Perhaps surprisingly, our results present no evidence of digital music sales displacement. While we find important cross country differences in the effects of downloading on music purchases, our findings suggest a rather small complementarity between these two music consumption channels. It seems that the majority of the music that is consumed illegally by the individuals in our sample would not have been purchased if illegal downloading websites were not available to them. The complementarity effect of online streaming is found to be somewhat larger, suggesting a stimulating effect of this activity on the sales of digital music.

Specifically, the study found that legal purchases would be about 2 percent lower without illegal downloading available—meaning, yes, illegal downloads boost legal downloads. Their conclusion: people who download pirated music mostly do so for tunes they wouldn’t have ever spent money on. The positive effect of streaming was even larger.

(MORERevenue Up, Piracy Down: Has the Music Industry Finally Turned a Corner?)

One interesting finding from the study is the observation that illegal downloaders were active in music consumption during more than twice as much of the year as legal-only consumers—including being more active on legal sites. In other words, people who like to listen to a lot of music are more likely to listen to music from multiple sources, while people who don’t really care for music are more likely to download only legally but not very much overall.

This complicates the evidence, because there’s no way to know whether those music lovers would consume the same amount total—or like music just as much—if illegal downloads weren’t an option (though the authors tried to track how many music-related sites the participants visited while not actually purchasing or listening to music).

Other findings include:

  • Women and men stream music about equally but men download more.
  • People with higher education levels stream more music, but income does not affect streaming levels.
  • Spanish people click on illegal downloading sites 230% more than Germans, with Italians coming next at 134% more than their neighbors to the north. The study’s authors speculate that these differences could be due to cultural differences and/or economic situations in the countries involved.

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Not everyone is ready to take these study results at face value. The International Federation of the Phonographic Industry released a response on Mar. 20…and they are not happy:

IFPI believes the [Joint Research Centre] study is flaws and misleading. The findings seem disconnected from commercial reality, are based on a limited view of the market and are contradicted by a large volume of alternative third party research that confirms the negative impact of piracy on the legitimate music business.

The IFPI notes that clicking on a legal download website does not equal buying music, that past studies have found that the “some people buy and steal a lot of music because they love music” argument is counterbalanced by the many people who consume a huge amount of money purely illegally, and that the study ignores other music-consumption options like subscription services.

And of course, as the study’s authors do acknowledge, sales data are not the only reason music-industry professionals don’t like piracy. Even if the IFPI’s criticisms were unfounded, the copyright and ethical implications remain unchanged: if you went into a store to steal a candy bar and, in the process, found lots of other stuff you were willing to pay for, would that make it okay to steal the candy? And what does it mean if you don’t really care?

Source: Times.com