P2P users buy more music -- Canadian govt study

A economic study funded by the Canadian government has concluded that heavy P2P users buy more music.
* When assessing the P2P downloading population, there was "a strong positive relationship between P2P file sharing and CD purchasing. That is, among Canadians actually engaged in it, P2P file sharing increases CD purchases." The study estimates that one additional P2P download per month increases music purchasing by 0.44 CDs per year.

* When viewed in the aggreggate (ie. the entire Canadian population), there is no direct relationship between P2P file sharing and CD purchases in Canada. According to the study authors, "the analysis of the entire Canadian population does not uncover either a positive or negative relationship between the number of files downloaded from P2P networks and CDs purchased. That is, we find no direct evidence to suggest that the net effect of P2P file sharing on CD purchasing is either positive or negative for Canada as a whole."

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  1. thats defintely not true for me. at least for music.

    but i download tv shows and movies all the time, usually just to hold me over until the dvds are out, because with dvds i care about having the physical object. not so much with music.

    my tv show/movie ratio of pirated vs eventually bought is probably in the 90% range.

  2. It’s certainly true for me. I can think of several artists who I never would have bought if I had not first downloaded their music. Two in particular come to mind that I discovered via p2p and now legally own everything they have released (Johnny Dowd & Kaito). I had a couple of Tom Waits later records, but after downloading some of his earlier stuff, I now own nearly his entire catalog (I own at least 12 of his records, up from 3 prior to downloading his stuff). There are probably numerous other examples, but those are probably the most dramatic.

    Even more interesting, during periods when I download more, I also buy more. I haven’t downloaded music for probably a year or more, and I’ve hardly bought any CD’s recently– probably two CDs in the last 6 months. When I am actively downloading stuff, I listen to more music, so I end up buying more music. That’s certainly not true of everyone, but I’m willing to bet that it is true of the majority of p2p users, and this is not the first study that I’ve seen that suggests that I’m right.

  3. I don’t think the headline matches the content. The study doesn’t find that P2P downloaders buy more music. The study finds “no direct evidence to suggest that the net effect of P2P file sharing on CD purchasing is either positive or negative for Canada as a whole.”

    It would be more accurate to say that more active P2P dowloaders buy more music (than less active dowloaders).

  4. I’ve started to care for music once I had the option to listen to the bands I’ve read about on Wikipedia or All Music Guide. When most radios (don’t get me started on MTV and the like) around here are pretty much dedicated to either Modern or past Top40 stuff, downloading was pretty much the only way to listen to bands like Chameleons, Sound, Cocteau Twins, Psychocandy-era Jesus and Mary Chain, My Bloody Valentine and like. All these I’ve discovered through downloads.

    Now there’s Last.fm and YouTube, which provide a somewhat legit way to listen the bugger hits (I still don’t get why labels are so fast on taking them down – free advertising, and nobody will stop getting their DVDs because of YouTube’s shoddy quality videos), but downloading is still the best way to go. I’ve doubled my record collection in the past 9 months once I was certain that *this* is the music I’d still be listening in some years’ time instead of random “flavours of the month”.

    My usual theory is that more than piracy, MP3 distribution affect the record companies’ strategy by allowing people to have much less focused musical preferences, so by locking out all freely available alternatives, they force most people to follow the path of the Nelly Furtados, U2s and the like that gets played every hour on your radio station.

  5. What about the fact that those who buy lots of cds are likely to be those who are heavy on the p2p.

    I have absolutely no doubt that p2p has some good effects on the industry – especially for really good small time artists, for whom the exposure is invaluable, and for generating fanbases, and so on – but the question is whether or not the net effect is good or bad. and i don’t think we’ll ever know, because it’s not just p2p that has changed, but the music industry’s response to it, and the way people approach music now – esp at live festivals and so on – and all manner of other things.

    What I want to know, and anyone who has a sensible answer to this please let me know, why don’t labels / artists have a donation box on their websites or whatever allowing people to express appreciation for music they may have enjoyed illegally? is it just because it’s seen as admission of defeat?

  6. well it’s not entirely true for me.. with p2p i started to listen to many more artists and bands but i’ve bought fewer CDs since then.. on the other hand I started to buy a lot of alternative music at iTunes Store (almost U$80.00/month) because I just don’t care about the booklet. which in some cases iTS provides, and the case. I just wanna sit on my bed with my laptop and buy comfortably…

    so you can say that my active use of p2p did not affect music sales at all!!

  7. If it’s good I’ll buy it–simple as that. I just download to make sure it’s actually worth paying for before going out and wasting my money and time on something that I’ll later find out wasn’t as good as I thought it would be.

    I have a collection of literally about ten thousand dollars worth of video games, anime and movies that I’ve slowly acquired over the years. About 95% of it I wouldn’t have even KNOWN about were it not for P2P and Bit Torrent downloading.

    I recently wrote a post about ‘piracy’ on my blog if anyone wants to read my 4:30 AM rantings about the media industries’ opinions on downloading. :P

    http://www.nerdculture.org/2007/10/30/why-does-piracy-exist/

  8. Yeah, this squares absolutely with research way back in the 70s when the UK record industry was campaigning against audio cassettes under the slogan “hometaping is killing music”. Somewhat embarrasing then that properly-conducted research showed that those who copied vinyl albums on to cassettes were also the biggest buyers of vinyl albums, more likely to buy new music etc etc. it’s exactly the same as today – the technology may have moved on, but the big business record companies haven’t changed one little bit.

  9. In my particular case, downloading is the previous step to buy a CD. I mean, when I don´t know if I´m gonna like some album, I download it and then if I like it, I buy it. I like to have the Albums I like on CD or Vinyl.

  10. “a strong positive relationship between P2P file sharing and CD purchasing. That is, among Canadians actually engaged in it, P2P file sharing increases CD purchases.”

    Interesting analysis. I wonder whether the authors of the study, however, considered that they might have the relationship between the two factors the wrong way around, i.e. those who make more CD purchases are more likely to be involved in P2P file sharing? This would explain the “no net effect” of the second paragraph.

  11. For me this is reminiscent of the notion of “mavens” in Malcolm Gladwell’s book The Tipping Point: individuals who produce home mix tapes or make (selected) tracks available on P2P networks can fill the role of experts on what’s good to buy but less easily found than heavily-marketed goods.

    There’s probably also an effect from free sample distribution, which enhances the ability of every individual to survey more artists and more recordings with the same limited economic resources in the form of money — don’t have to buy whole collections to evaluate an artist, spending can be focused on collections and artists likely to be interesting. But the real bottom-line of economics is the finite amount of time we have in our lives, and as we find Mavens with whom we frequently agree through the P2P or home-tape network, we take advantage of the time they’ve already spent on the discovery and selection process.

    P2P networks can be particularly good for this because they can reduce or eliminate the need for human Connectors to hook them up with Mavens — I found artists and music through the home-tape network because I knew people who connected me to Mavens. With P2P I have an opportunity to search for Mavens based on music we already agree about, then look for work the Maven knows about but which I haven’t yet found.

    Unless I find Mavens who like the material being pushed by the record labels, this process could lead to me spending the same amount of money and time on commercial music (e.g. no net effect on CD sales, since I spend as much as I can comfortably afford in any case), just buying less of the material the record labels have spent the most promoting.

    Advertising and marketing are a kind of frictional force in the free market, a distortion of the relative availability of information about products which allows vendors to manipulate the underlying realities which give rise to the laws of supply and demand. Any mechanism that removes the burden of frictional forces from the free market is harmful to those whose livelihood is fed by that friction.

    Activities like paying radio stations to distort their selection process in favour of the record labels’ preferences interfered with a mechanism through which Mavens could make their knowledge available, and restored some of the friction that label executives use to warm their cold and stony treasure hoards.

  12. Its all about consumer freedom and how threatening it is to corporations.

    I just picked up Saul Williams’ latest album last week. I voluntarily paid $5 for a legal download.

    This is an artist that I found out about through a friend, and who was also supported by a band I’ve liked for years (Nine Inch Nails) and who I saw on tour with them in 2006.

    He ‘leaked’ two of his own tracks via P2P, then offered the album for either free download at 192kps or a paid download at a choice of 192kps, 356kps, or lossless FLAC. All DRM-free, even the free version. It included cover art and a 33-page PDF booklet.

    The point is, here is an artist with no local radio support, no corporate support, who I found out through a friend (who found out through the net) and is currently heavily supported by a major ‘band’ who has just gone label-free. He offered his album for free, or for a cost that offered CD-quality DRM-free music for a respectable cost of only $5.

    If I was a suit, I’d be scared of that becoming the norm too.

  13. serotonin said:

    “He offered his album for free, or for a cost that offered CD-quality DRM-free music for a respectable cost of only $5.”

    The thing that’s always baffled me is that Saul Williams almost certainly made more money off of his album selling it this way then if he had gone the traditional label route. If he had been with a major label, he would have probably made pennies per CD sold at best. Here, he made $5 per CD with none of the headaches of dealing with the label. Granted, he probably sold fewer records, but at 20+ times the profit per copy, that seems a reasonable trade off considering he retains complete artistic & legal control of his music by self-releasing. So all of that considered, why in gods name don’t more artists do things this way?!?!

  14. So all of that considered, why in gods name don’t more artists do things this way?!?!

    Because very few have the existing financial (studio time, production services, etc) and promotional support of already famous people like Trent Renzor. Self releases are not in any way the gateway to fame and riches (or even recouping costs) that some folk might have you believe.

  15. Downpressor, have you changed your meds, or is there some other reason you’re going back through old arguments to rant at Cory?

  16. Teresa,

    The comment in this page wasnt addressed to Cory at all. I found something I missed from awhile ago and replied. If theres a time limit on replies, why not have the server close the feature after X amount of days? Aside from that, your comment is about as worthwhile as someone asking if you are on the rag for replying out of context.

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