Monday, 17 October 2011

More than 100% of the fall in music sales is because of file sharing?

Interesting paper by Stan J Liebowitz on SSRN: "The Metric is the Message: How Much of the Decline in Sound Recording Sales is Due to File-Sharing?" click here.

He has consolidated the estimates in a series of research and other papers, corrected them for the same metric, and used this to produce a range of estimates for how much of the fall in sales was caused by file sharing.

His conclusion, which is pretty dramatic, is that over 100% of the fall is due to file sharing. The number is over 100% because he suggests that sales would otherwise have grown, so that the fall from previous year's figures is less than the "actual" fall (if you see what I mean).

This paper needs re-reading, by me at least, to see whether the conclusions are fully justified. Forexample, I'm not certain that the papers he analyses, and thus his conclusions, make the causal link strongly. But if he is right, it suggests that if only people wouldn't keep breaching copyright law, the music industry wouldn't be in its current parlous state.

It's that "if" where the crunch comes. I don't think users ever did obey copyright law (I was a teenager in the 70s when the audiocassette arrived), and the reasons are allto do with the fact that (a) copyright law is not accepted by users as addressed to them, plus (b) online you can't not copy, so the law seemseven more meaningless than it did in the analogue age.

More about this in "Making Laws for Cyberspace" (OUP, April 2012)


  1. Correlation is not causation. It is also possible that the failure of the content industry to provide a compelling online offering has caused both the fall in music sales and the level of file sharing.

  2. I agree Pete - and all the underlying papers are estimates based on ... precisely what is not clear, but in many cases just gut feeling.

    If the failure to provide an online offering is part of the cause, then one might expect to see a rise in lawful downloads and uptake of licensed streaming services - and we are seeing such a rise, though to a far lesser extent than the fall in CD sales. There is clearly a substitution in the market, of digital form for hard copy product, as evidenced by the fact that for some years almost none of my students have bought or been given CDs.

    How to factor in this market change I have no idea, but I thought the paper was worth alerting people to.