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Piracy EU Your Rights Online

Study: Piracy Doesn't Harm Digital Media Sales 173

Posted by Soulskill from the millions-of-internet-goers-suddenly-feel-justified dept.
r5r5 writes "European Commission's Institute for Prospective Technological Studies has published a study which concludes that the impact of piracy on the legal sale of music is virtually nonexistent or even slightly positive. The study's results suggest that Internet users do not view illegal downloading as a substitute for legal digital music and that a 10% increase in clicks on illegal downloading websites leads to a 0.2% increase in clicks on legal purchase websites. Online music streaming services are found to have a somewhat larger (but still small) effect on the purchases of digital sound recordings, suggesting a complementary relationship between these two modes of music consumption. According to the results, a 10% increase in clicks on legal streaming websites leads to up to a 0.7% increase in clicks on legal digital purchase websites." It's worth noting that this study only measured the effect of piracy on online purchases, not on revenue from physical formats.
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Study: Piracy Doesn't Harm Digital Media Sales More

Study: Piracy Doesn't Harm Digital Media Sales

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    • Re:This was proven years ago... (Score:4, Insightful)

      by 2.7182 ( 819680 ) on Tuesday March 19, 2013 @03:18PM (#43217009)
      For example, just because some people steal cars doesn't mean that I am not going to buy a car. It's all very deep.

      • a 10% increase in clicks on illegal downloading websites leads to a 0.2% increase in clicks on legal purchase websites

        uh oh, cue the correlation/causation nazis. ok, i'll go first. just cuz thy measured a 10% increase in pirate clicks and an 0.2% increase in legal purchase clicks doesn't mean there is a connection. Heck, perhaps if there had been fewer pirate clicks then there would have been more legal clicks! Also, what the heck is a click? shouldnt the metric be downloads or purchases?

        • Re: (Score:2)

          by jaymz666 ( 34050 )

          By click do they mean click or download?

        • Interesting data, but doesn't support conclusion (Score:4, Insightful)

          by Geoffrey.landis ( 926948 ) on Tuesday March 19, 2013 @04:23PM (#43217865) Homepage

          Yeah. Their data does not support their conclusions.

          First, note that their conclusion was that there is "essentially zero" correlation between illegal downloads and legal downloads. The correlation they found (for every 100 people who illegally download, 2 of them will go on to legally download the music) is insignificant (and "essentially zero" is their phrase, not mine.)

          What they don't measure, though, is what would have been purchased if pirate downloads had not been available. They do say, however, that 20% of the people who clicked on pirate download sites never went to legal download sites, not ever once. If even one in ten of these people would have bought a legal download if they couldn't get the illegal one, that would wash out their 0.2 percent positive correlation entirely, not even thinking about the remaining 80% who sometimes looked at legal sites but ended up downloading from pirate sites. What fraction would have bought music legally if pirate downloads weren't available? I don't know-- but neither do they.

          • If even one in ten of these people would have bought a legal download if they couldn't get the illegal one, that would wash out their 0.2 percent positive correlation entirely

            Right. It's all a wash.

            So now can we please just stop all the nonsense and have the RIAA leave people alone?

          • you know why people don't even bother anymore to try buying stuff anymore?

            Because the "pirate" download is easier, sometimes faster, and, especially in the case of videos, earlier and better (meaning without all these traillers, fbi screens on the beginning etc).

            Besides, the industry only moved their slow butts for two reasons: this piracy they speak of and apple. If they could, they would be selling nicki minaj crap por 30 dollars each song.

        • just cuz thy measured a 10% increase in pirate clicks and an 0.2% increase in legal purchase clicks doesn't mean there is a connection.

          I agree. There is no connection between piracy and music industry profits.

          So now can we just stop the nonsense?

          • "I agree. There is no connection between piracy and music industry profits.

            So now can we just stop the nonsense?"

            The thing is, though, it doesn't matter if there is a cause-effect relationship, as long as the correlation holds. And we know that it has, for at least 13 years (because the first study I read about that showed this same correlation was in 2000).

            We know that the correlation has held, despite changes in the laws, despite highly publicized (and abusive) lawsuits... despite everything. Study after study after study have shown that the biggest downloaders of shared files (not "pirates", which is something v

      • Re: (Score:2, Funny)

        by Synerg1y ( 2169962 )

        What? People steal cars? I better DRM mine.

        • Re: (Score:3, Funny)

          by Anonymous Coward

          Digital Ride Management?

          • Car moves too far from your home without you in it - it goes BOOM!
            You don't need to worry about police or insurance either.
            Mine's packaging is covered in Arabic so it all looks like a terrorist car bomb gone bad.

            • I think you'll enjoy this, [youtube.com] assuming you haven't seen it already.

              Don't worry, it's SFW, assuming your employer doesn't have a grudge against Volkswagen.

          • Dog with Rockets and Machineguns

          • Re: (Score:2)

            by sjames ( 1099 )

            I've seen it attempted. Some teens were walking through the parking lot minding their own business when a car said (in that deep monster truck announcer voice) something about 'the viper' and standing too close (they were not really THAT close). One of the kids (apparently intoxicated) yelled "OH YEAH! Well FUCK YOU!" and began smashing the headlights and windshield while yelling "fuck you" repeatedly.

            Yeah, I guess Digital Ride Management works about the same as the other DRM then.

    • Re:This was proven years ago... (Score:4, Insightful)

      by SpaceMonkies ( 2868125 ) on Tuesday March 19, 2013 @03:33PM (#43217205)
      Piracy's real effect on music sales is difficult to accurately assess. In classical economics prices are determined by the combination of the forces of supply and demand, but the participators in the digital market do not always follow the usual motives and behaviors of the supply and demand system. First, the cost of digital distribution has decreased significantly from the costs of distribution by former methods. Furthermore, the majority of the filesharing community will distribute copies of music for a zero price in monetary terms, and there are some consumers who are willing to pay a certain price for legitimate copies even when they could just as easily obtain pirated copies, such as with pay what you want vendors.
      Another issue is that because some people, like many in China, illegally download music because they cannot afford to purchase legitimate copies, not every illegal download necessarily equates to a lost sale. This has some effect on music sales, but as Lawrence Lessig points out, there is wide asymmetry between the estimated volume of illegal downloading and the projected loss of sales:
      “In 2002, the RIAA reported that CD sales had fallen by 8.9 percent, from 882 million to 803 million units; revenues fell 6.7 percent. This confirms a trend over the past few years. The RIAA blames Internet piracy for the trend, though there are many other causes that could account for this drop. SoundScan, for example, reports a more than 20 percent drop in the number of CDs released since 1999. That no doubt accounts for some of the decrease in sales... But let’s assume the RIAA is right, and all of the decline in CD sales is because of Internet sharing. Here’s the rub: In the same period that the RIAA estimates that 803 million CDs were sold, the RIAA estimates that 2.1 billion CDs were downloaded for free. Thus, although 2.6 times the total number of CDs sold were downloaded for free, sales revenue fell by just 6.7 percent... So there is a huge difference between downloading a song and stealing a CD."

      • Re: (Score:3, Insightful)

        by PopeRatzo ( 965947 )

        In classical economics prices are determined by the combination of the forces of supply and demand

        Let me know if you run into any of those classical economies. The one we're in is anything but.

        "Supply and demand" are relics of the Industrial Revolution. Few of the really big industries (and especially ones that have to do with virtual property) show any "supply and demand" effect any more. And what constitutes "supply" when you're talking about digital information? I assure you, there has never been a

        • Supply and demand are still useful for gauging economic reactions. The problem is that Supply and demand are like Newtonian Physics: Very useful in the simplified case, but there's more going on there. In physics it's relativity. In economics, there are various other forces at work (e.g. lobbying, government action, and, yes, even piracy). Those other forces have an effect on price, though each case varies (and can even vary from purchase to purchase within the same market). Still, supply and demand ar

    • Re:This was proven years ago... (Score:5, Insightful)

      by rudy_wayne ( 414635 ) on Tuesday March 19, 2013 @04:08PM (#43217645)

      ... as I recall.

      A few years ago I found a magazine article about music "piracy" from 1981. Back in those days most of the technology we use today didn't exist. Almost no one had a computer, there was no Internet (as we know it today), etc.

      The villain back then, according to the RIAA was cassette tape recorders -- people were making tapes of their friends albums rather than buying them. So the RIAA commissioned a study that they hoped to take to Congress to convince them that they needed new laws to combat this terrible problem. But the report was shelved and never widely publicized because it showed that people who owned high end cassette decks, on average, bought 75% more albums than people who didn't.

      The more things change, the more they stay the same.

    • Repeatedly.

      But, just like with the hundreds of studies that disprove the lies about marijuana use, the people who buy our government simply don't care, and will continue to reject reality and substitute their own.

    • And it's just as irrelevant to me now as it was then. I believe people should approach this issue from the freedom angle, not the "Well, it doesn't really hurt sales..." angle; anything else misses the point, in my opinion.

  • Too bad EA didn't get the memo in time.

    • Re:A bit late (Score:5, Insightful)

      by i kan reed ( 749298 ) on Tuesday March 19, 2013 @03:24PM (#43217079) Homepage Journal

      Yes, but they also want to make sure you can't sell it later, and keep you from getting refunded by retaining the power to remove your license at any time.

      EA wasn't out to stop pirates, they were out to manipulate and screw over the customers.

      • As far as used game sales, they already had that. No one sells used PC games, gamestop doesn't take physical copies used, they haven't for years, there's as of yet no way to transfer purchases on Steam or Origin.

        Perhaps they were planning on shutting down the servers when the next sim city came out, forcing you to buy the new version. That I could see.

      • Or ban you from completely unrelated services.

        Apparently EA threatens to ban you from Origin if you try to dispute a purchase of simcity

  • and (Score:5, Insightful)

    by Master Moose ( 1243274 ) on Tuesday March 19, 2013 @03:17PM (#43216993) Homepage

    the recording industries will simply stick their fingers in their ears whilst singing "nanananananana"

  • I'm not defending MAFIAA in any way, but just want to point out, that the study was conducted under circumstances when file sharing is illegal.

    If it becomes legal, it may very well impact the sales in a negative way. Bottom line: interesting study, no practical applications.

    • Re:Only when file sharing is illegal. (Score:5, Insightful)

      by Shagg ( 99693 ) on Tuesday March 19, 2013 @03:25PM (#43217107)

      Don't spread the MAFIAA's FUD for them. File sharing is already legal. "File sharing" and "copyright infringement" are not the same thing.

      • how, exactly, is shagg's comment "insightful?"

        1. the idea that "file sharing is already legal" is a meaningless statement. it's like saying that "driving a car is legal." yes, it's legal on roads for licensed drivers. it is not legal to drive through a busy shopping mall a la blues brothers.

        2. 'file sharing' and 'copyright infringment' are not the same thing. who said they are? however, in the USA, "sharing" of copyrighted music and film, for example, for all but a very limited set of exceptions as

        • Re:Only when file sharing is illegal. (Score:4, Insightful)

          by jxander ( 2605655 ) on Tuesday March 19, 2013 @04:12PM (#43217699)

          Shagg's comment is valid because the MPAA and RIAA don't seem able to make the distinction.

          If I rip a DVD that I purchased to a computer I own, that could be considered file sharing. The DVD has shared the file with the computer, but I have not infringed a copyright. If I transfer that digital copy to my tablet or smartphone so that I can watch it during a flight, also file sharing, still not infringing.

          If I use the copy on my computer to burn physical DVDs and begin selling them, THAT is a copyright infringement

          The powers that be, via DMCA, seek to outlaw all of these practices, and many more.

          • I usually don't consider making copies that only you are accessing to be file sharing. An example of legal file sharing would be if a musician released a song for free under a license that encouraged people to share it. Then, if you e-mailed that song to a friend (or put it on a file sharing network), it would be both file sharing AND legal.

            Of course, ripping a DVD for your personal use isn't copyright infringement but it is against the DMCA's DRM anti-circumvention laws. So ripping a CD for your use is

        • Re: (Score:2)

          by AK Marc ( 707885 )
          If you see the industry propoganda, downloading *anything* you didn't pay for is illegal. And even then, if you didn't pay enough, it's probably still illegal. So the distinction does have meaning.

      • Legal to share (Score:5, Informative)

        by AliasMarlowe ( 1042386 ) on Tuesday March 19, 2013 @03:44PM (#43217303) Journal

        Don't spread the MAFIAA's FUD for them. File sharing is already legal. "File sharing" and "copyright infringement" are not the same thing.

        Indeed. And there is a lot of music available which is either in the Public Domain, or under one of the Creative Commons licenses. For instance, excellent recent recordings of classical music were released as 320kbps MP3 [archive.org] and as lossless tracks [archive.org], and these are explicitly in the Public Domain. Lots more (typically electronic & rock & metal & house, etc.) can be found at the Netlabels [archive.org] collections. MusOpen [musopen.org] typically has classical music, and also has some PD or CC sheet music.

        Share away, with these files. Upload, download, give away, stream, sell, whatever. And quite legally. Just about the only thing you can't do with Public Domain stuff is claim that you own the copyright, or that you act on behalf of the copyright owner. Either copyright has expired, or it was never copyrighted to begin with.

    • Re:Only when file sharing is illegal. (Score:5, Insightful)

      by BradleyUffner ( 103496 ) on Tuesday March 19, 2013 @03:25PM (#43217113) Homepage

      I'm not defending MAFIAA in any way, but just want to point out, that the study was conducted under circumstances when file sharing is illegal.

      If it becomes legal, it may very well impact the sales in a negative way. Bottom line: interesting study, no practical applications.

      This doesn't necessarily mean that sharing music should become legal, it just means that it shouldn't be life-ruiningly-illegal. Speeding is illegal, but if you get caught you just get a small fine and life goes on. They don't fine you more than 10x your yearly income and stick you with legal fees that could bankrupt CEOs.

      • I agree, and I can't understand why the media industries haven't pushed for this sort of thing.

        If Jammie Thomas had been fined $100 then she would have had no sympathy. It would deter a lot of people. A lot of people would take the risk, but the same happens with illegal parking. We only need to keep the problem manageable. There would be issues in that we'd need some sort of appeals mechanism and wouldn't want to cause too much hassle for the false positives, or make it too easy for a media company to ch

        • We only need to keep the problem manageable.

          It will never be manageable to go to court for such petty things. There are simply too many people that ignore copyright law, and the nature of the Internet makes it too difficult to find many of them.

          There would be issues in that we'd need some sort of appeals mechanism and wouldn't want to cause too much hassle for the false positives, or make it too easy for a media company to churn out notices like they do with the DMCA.

          Given the industry's track record, the end result would very likely be that the burden of proof would be placed on the accused and everything would be made more convenient for the companies trying to extort money out of the supposed infringers.

          • There are simply too many people that ignore copyright law

            And here lies a fundamental problem. A very large proportion of society (I don't know how large) don't want that law to apply to them.

            So either they need to be better educated about the existence of copyright law and the (moral) reasons for respecting copyright law, or the law should be changed to what the people can accept and obey.

            • So either they need to be better educated about the existence of copyright law and the (moral) reasons for respecting copyright law

              There's no guarantee that they'll agree with the laws even if one tries to 'educate' (in this case, it would probably amount to brainwashing) them.

              or the law should be changed to what the people can accept and obey.

              But hey, people in the US accept and obey the TSA, so I don't exactly have high hopes for them.

      • Only commercial piracy should be illegal (Score:2, Insightful)

        by Anonymous Coward

        Everyone understands that it's wrong when a commercial outfit pirates and sells music or films for their own profit. Only they themselves would object to it being illegal.

        But non-commercial media sharing is in a very different category to that. The sharing that kids do on the Internet is just today's counterpart to what we used to do as kids back in the day, copy our records onto cassette tape for our friends, and it's certainly not criminal activity.

        It was free promotion back then, and it's free promotio

        • Everyone understands that it's wrong when a commercial outfit pirates and sells music or films for their own profit. Only they themselves would object to it being illegal.

          But non-commercial media sharing is in a very different category to that. The sharing that kids do on the Internet is just today's counterpart to what we used to do as kids back in the day, copy our records onto cassette tape for our friends, and it's certainly not criminal activity.

          Except that if those kids put up a torrent, it's not usually just some copying between the friends on the block, but to thousands of people all around the world, with short delay. It can be much more powerful distributor than a commercial piracy outfit.

        • Only commercial piracy should be illegal

          I disagree. I believe that copyright in general should just vanish entirely.

          Everyone understands that it's wrong when a commercial outfit pirates and sells music or films for their own profit.

          I don't understand that, so your statement that "everyone" understands it's wrong is false.

          Only they themselves would object to it being illegal.

          Ah, so anyone who disagrees is on the Bad Guy Team.

    • Although I don't care whether or not it 'hurts' sales, I do find it interesting that we don't even know what the result would be without copyright law and yet we have them in effect.

  • ...a 10% increase in clicks on illegal downloading websites leads to a 0.2% increase in clicks on legal purchase websites

    That illegal activities outnumber legal ones by about a factor of 500 to 1?

  • This study has been done 100 times and it always reaches the same conclusion. These prosecutions are just serving as a minor revenue stream and a means to legitimize a set of rules that benefit the record companies far more than the consumers [dailykos.com] or the artists [afterdawn.com] they are purporting to protect [slashdot.org].

  • How Does "Piracy" Help Digital Sales? (Score:4, Interesting)

    by assertation ( 1255714 ) on Tuesday March 19, 2013 @03:58PM (#43217495)

    I can see "piracy" helping CD sales. Basically, it becomes a "try, before you buy" situation and someone wanting the information stored in a nicer way.

    I don't see how it helps legal digital sales. If someone pirated X, they already have X, so why would they buy it?

    Is it the case that once having pirated X, they buy X+1, not being able to find X+1 on the pirate sites?

    • Is it the case that once having pirated X, they buy X+1, not being able to find X+1 on the pirate sites?

      This seems likely to be the case, at least to me. Baen Books released a bunch of free ebooks and found that sales of the next book in the series increased. A different type of file, and this was before e-readers were so pervasive, so their results may be different now.

    • I don't see how it helps legal digital sales. If someone pirated X, they already have X, so why would they buy it?

      Is it the case that once having pirated X, they buy X+1, not being able to find X+1 on the pirate sites?

      People tend to expect others to act the way they themselves do.

      The "everyone is a money-grubbing cheat and scoundrel like we are" RIAA view: Someone pirates X, likes it, so they go pirate X+1.

      The "I just want what's fair for me and you" view: I heard a nice snippet of your music X i

    • Maybe they only pirated one album from an artist and they want the rest of their discography.

      Or maybe just they *gasp* actually want to support the artist so more music will be made.

    • Re: (Score:2)

      by AmiMoJo ( 196126 ) *

      If you like X you look them up on Google and see links to buy more of their stuff. There are some people who just wont pay, but they are not lost sales anyway. The rest will buy given the opportunity to purchase DRM free MP3s or FLAC at a reasonable price.

    • Lossless with high res scans of the booklet, with perfect tags and the ability to redownload if all my hard drives and backups die at once? Definitely worth a few bucks imo.

      Pirated versions are a bit hit and miss in these regards... I tend to use them for a first listen before purchasing the real deal, although Spotify has pretty much taken over for that.

  • A bit off-topic, but I was watching Star Trek: The Next Generation during my lunch break, and I caught the Samaritan Snare [memory-alpha.org] episode, in which some aliens capture a Federation phaser and then proceed to replicate copies of it. Seeing that, I was immediately reminded of all this stuff regarding intellectual property, and it made me wonder: how in the world could a culture like ours survive in a world where even physical goods can be replicated without harm to the original creator of the product? When it's poss

  • It started off with a copyright disclaimer saying "Piracy is not a victimless crime".

    It got me thinking, yes I feel for the 1% affected by piracy because instead of making $1.4 billion they will only make $1.2 billion this year.

    Most of us just cannot relate to the impact losing $200 million has on your life and so we should do more to prevent online piracy and not steal content ourselves.

    I for one will no longer steal content because I am such an asshole for taking profit away from the 1%. They have mouths

  • If a 10% increase in piracy activity correlates with a 0.2% increase in legal activity then we can estimate that a dollar of stolen media corresponds to $0.02 in lost revenue. If the RIAA came after me for 100 pirated songs, I'd be happy to settle the lawsuit for $2.

  • This has been proven over and over and over again in all manner of ways and all manner of areas.

    People believe, for example, that homosexuality is somehow learned and that homosexual parents will make gay children. Provably false all over the place. People continue to believe that being cold gives you a cold. This is also provably false and no one ever questions how one gets a cold in the summer time. It's like apples can hit them on the head all day long and they'll NEVER get that apple come from trees

    • I still think that the best thing the RIAA could have done to hurt piracy back in the Napster days would have been to 1) buy Napster, 2) put a limit on the quality of shared MP3s (e.g. at most radio quality), 3) offer high quality, non-DRMed MP3s for purchase at reasonable prices through the same system. They would have created the first major online music shop and would have a built-in way for music to spread from person to person while still giving people an incentive to pay for their music.

      Instead they

  • Who cares about physical formats except for half a dozen music nerds who wants the "experience" of a physical object? It's pretty obvious that the younger generations just want to hear their music, not accumulate dust.

  • The sociopaths in suits are too brazen, too stubborn, too consumed with power, wealth and political connections to care what it says in "some study" that they'll snidely dismiss.

    It doesn't matter if they're factually proven wrong, these sociopaths have continually demonstrated that they are beyond reason.

    When they start losing money because artists are sick of their bullshit? Must be piracy.

    Funding through Kick Starter? Yup, piracy.

    Alternative distribution methods that earnestly attempt to legitimatize? Pir

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