This is a
printer friendly version of an article from www.heraldtribune.com
To
print this article open the file menu and choose Print.
Article published Apr 20,
2004
Online
bogeyman?
Study suggests record industry
exaggerates threat
Record companies like to blame declining
sales of CDs on Internet piracy. So many music listeners are downloading music
online and "burning" it on CDs to share with friends that fewer people are
buying CDs, the companies say.
But a new study raises doubts about how
much, if any, of the 30 percent decline in sales that the Recording Industry
Association of America says it's suffered since 1999 can be blamed on illegal
downloads.
The study by professors Felix Oberholzer of Harvard Business
School and Koleman Strumpf of the University of North Carolina found that
"Downloads have an effect on sales which is statistically indistinguishable from
zero."
The researchers tracked online downloads of music tracks for 17 weeks
in 2002 and compared those with weekly sales of the CDs that the tracks appeared
on.
Using complicated mathematical formulas, they determined that the
downloading had a negligible impact on sales. "Even in the most pessimistic
specification, five thousand downloads are needed to displace a single album
sale," they wrote.
The RIAA countered with a six-page statement saying
the study was flawed, "incomprehensible to the layman," and contradicted by
other academic studies.
The study's results suggest, however, that maybe the
recording industry should stop looking for scapegoats and consider that the
sales decline may have something to do with the overall quality of the product,
and the high price of compact discs.
Music piracy is theft, pure and
simple. But it's hardly responsible for all of the industry's
ills.