Filesharing is Not the Enemy

Contrary to the paranoid preaching of the Recording Industry
Association of America (RIAA), online filesharing may not be the
grisly monster that is eating up CD sales and single-handedly
destroying the recording industry. A new study conducted by Harvard
Business School in conjunction with the University of North
Carolina tracked 1.75 million downloads over a 17-week period in
2002 and compared those observations to the sales of 680 popular
albums, finding no link between filesharing and CD sales, Joy
Lanzendorfer writes for AlterNet. In fact, the truth may
be that downloading music actually boosts sales for the
most popular 25 percent of CDs.

Responses to the study have varied. The powerful RIAA
emphatically denies the evidence, calling it ‘inconsistent with
virtually every other study done’ on the subject; and University of
Texas Professor Stan Liebowitz ‘believes the study shows the result
of advertising on popular music, not necessarily the effect of
downloading on the entire music industry,’ writes Lanzendorfer.
Most agree on one thing though — we have a lot to learn about the
effect ‘pirating’ music has on sales. ‘The only thing we can
confidently say is that filesharing makes some people buy more
records and some other people buy fewer records,’ says Fred Von
Lohmann, Staff Attorney for the Electronic Freedom Foundation.

Other than the record companies — whose CD sales declined by
139 million copies from 2000 to 2002 — the big loser may be
independent musicians, as legendary indy artist Ani Difranco
suggests. Ironically, Lanzendorfer points out, even Difranco ‘got
her start by people copying and passing around her tapes.’ Koleman
Strumpf, co-author of the Harvard-UNC report, admits that,
according to the results, independent musicians are the one group
hurt by downloads.

But the differences between indy and mainstream media cloud the
picture, suggests Eric Garland, CEO of BigChampagne, a market
research firm focusing on online media. ‘Many independent musicians
are not in the business of selling you a plastic disc, but a
relationship,’ he says. ‘They want a loyal fan, the person who will
buy a t-shirt or a concert ticket when they come into town. That’s
a very different business from the kind of widgets and Coca-Cola
products the four major labels are into.’
Jacob Wheeler

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Filesharing
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