Study Says P2P Downloaders Buy More Music

An anonymous reader writes "Michael Geist posts to his site about a study commissioned by the Canadian government intended to look into the buying habits of music fans. What the study found is that 'there is a positive correlation between peer-to-peer downloading and CD purchasing.' The report is entitled The Impact of Music Downloads and P2P File-Sharing on the Purchase of Music: A Study For Industry Canada, and it was 'conducted collaboratively by two professors from the University of London, Industry Canada, and Decima Research, who surveyed over 2,000 Canadians on their music downloading and purchasing habits. The authors believe this is the first ever empirical study to employ representative microeconomic data.'"

Comments

Bias in the study?

[Guido del Confuso]

According to the study:

...among Canadians actually engaged in it, P2P file-sharing increases CD purchasing. We estimate that the effect of one additional P2P download per month is to increase music purchasing by 0.44 CDs per year. However, it is important to remember that correlation does not equal causation. It seems just as probable, if not more so, that people who buy more CDs are more likely to engage in file sharing.

I find it curious that they would phrase their results in such a manner. From the data gathered in the study, I believe it is impossible to determine causation. To me, this throws their entire credibility into question.

Re:Bias in the study?

[someone1234]

I agree that correlation does not equal causation.
But at least this study shows that people who download, will still buy CDs.
And people who don't buy CDs are less likely to use p2p too.
So, simply people who like music will get it, be it CD or P2P.

Re:Bias in the study?

[Guido del Confuso]

I see what you're saying, but I'm not even sure how you could pose a question like that. At least, not one that would give you reliable information upon which to base such a conclusion.

I think what they've shown here is that P2P sharing does not decrease CD sales. That is, there is not a negative correlation. In fact, there may even be a positive correlation. But claiming that one causes the other strikes me as a politically biased conclusion. In other words, they set out to prove a position, and interpreted the facts in order to support that conclusion.

In addition, I think part of their hypothesis is flawed:

H2b. People who engage in music downloading and P2P file-sharing do so partly because they wish to hear a soundtrack or an artist before buying. Thus, there is a positive relationship between P2P file-sharing and music purchasing. First, this is poorly worded. Are they asking whether everyone engages in P2P filesharing has a partial desire to preview music? Or rather that some P2P filesharers have such a desire? Second, the conclusion does not logically follow. Whether some people use P2P to preview music, it may or may not be enough to offset the number of potential people who use P2P in lieu of buying music. Therefore, proving that some people do use P2P to preview before buying does not prove that "there is a positive relationship between P2P file-sharing and music purchasing."

Again, I'm not disputing the statistical results of the study. I believe it is a reasonable conclusion that P2P file sharing does not have a significant negative impact on CD sales. What I am disputing is the conclusion that P2P sharing increases sales of CDs. It may or may not actually be true, but that fact simply does not appear to be supported by the evidence.

Re:Bias in the study?

[Dhalka226]

The thing is, this debate is not particularly relevant. It's latched onto by Slashdotters in part, I think, to assuage their guilt for pirating music and prove how the RIAA is composed of nothing but greedy, self-serving bastards.

They aren't wrong. The problem is that the people who are opposed to illegal P2P file sharing of copyrighted music don't care what happens in bulk. They care whether or not an artist is getting paid when you receive that artist's music. The fact that you download, three CDs worth of music and purchase five CDs, for example, doesn't matter to them unless three of those five purchased CDs are the ones you've downloaded.

I'm sure anybody who has pirated music can point to a situation where they did indeed buy the CD (or specific tracks in the days of iTunes and the like) after pirating some or all of the tracks from it. I'm sure, if they are being honest, that they can also admit times when they downloaded songs that they never ended up buying. I think that in most cases, the latter situation would be the more common one.

I'm not meaning to imply that the RIAA is the champion of artists; they're not. They are the champion of record labels who historically have done whatever they can to screw the artists. I'm saying that if somebody opposes illegal downloading, they care whether each artist is compensated for their music and not whether artists as a whole are compensated.

And thus why the debate is really useless. Those people are not going to be swayed by any of these reports, whether they are truly concerned about the artists or using them as distractions for their own financial gain.

The debate worth having, as always, is how "we" get the people who download music and don't pay for it to become paying customers. You'll never get everybody, of course--at least not without giving it away free--but various approaches have their own benefits. The lower the price point, the higher the demand is a fairly obvious one. That site that just popped up with prices that fluctuate based on demand is an interesting experiment, though I think it goes the wrong way (prices increase as demand increases). I think the best experiment was the group that allowed you to name your own price for the CD.

All of these ideas likely need to be refined, but that is the direction we should be focusing our intellectual efforts in. As a nice side effect for the Slashdot crowd, the likelihood is that as systems such as those become more and more successful, the RIAA dies a little more and more. Artists and consumers both stand to win.

I don't think it will be long now.

Re:Bias in the study?

[Nossie]

That is illegal too if you ask the RIAA, at least in their eyes.

Re:Bias in the study?

[Technician]

I agree that correlation does not equal causation.
If you want evidence, just take a look into my past. When I was in high school, I lived in the country. There were no FM stations. The local AM station carried Country and Western. I didn't buy much music. LP's and 8 tracks were popular along with brick size mono compact tape recorders with fidelity good enough for voice letters. I managed to collect a couple LP's and 8 track tapes to play with, but nothing serious.

After high school, I went into the Navy. Here I became exposed to lots of great music much like a typical middle schooler or high school kid does now. I invested in great equipment, bought the best blank tapes, had a good linear track turntable with moving coil cartridge, etc and a pair of quality solenoid operated cassette decks. I made mix tapes, traded tapes, and bought albums of my favorite artists to put on tape to play in my car. Artists included Pink Floyd, Styx, Queen, Tomita, etc. My peak piracy days was my peak purchasing days. Without the peer to peer dorm life, I would not have had the exposure and would not have bought nearly as much stuff.

Now I am married and have kids and grandkids. Any band that needs to curse or have a screamer is not my idea of music contrary to what my adopted kids like. Other than volume to the wall distorted by heavy compression junk, I don't have much exposure to new music anymore. Most of my exposure to great music is often called illegal. For example, I caught the fantastic light show last Christmas with the house with the synchronized lights. By any RIAA rulings, that publication and distribution of the the song Wizards in Winter was a violation of copyright. Trans Siberian Orchestra on the other hand made a hero out of the guy and gave him VIP treatment to one of their concerts. Was he a criminal guilty of massive online copyright infringement, or a creative artist using and promoting another artist? The only reason he wasn't prosecuted was because the backlash would have been severe and swift. The artist that doesn't understand this is the artist once known as prince. See what happened when someone put a short video of a toddler dancing? The artist didn't get it. TSO and the RIAA could have been in the same boat but much worse for that Christmas light show.

I went to buy the album, but with the current litigation, I am directly avoiding RIAA labels. Unfortunately that album is on an RIAA label. Sorry TSO.

http://www.riaaradar.com/search.asp Search for Trans-Siberian

Peer to Peer is how people find out about new great bands. It's advertising.

The band is coming to my local area this fall. Unless they drop their label, I am not going to the concert.
If my dorm tape recordings could have resulted in the same $222,000.00 settlement, than I want no part in the industry that is suing their best customers.

In a nutshell, I am not legally exposed to new good music. Stuff on the radio is payola and off limits RIAA, ASCAP, BMI on my reject list. I don't buy music I don't know about. I do know about the litigation. I am voting against it as much a possible. Anybody tainted by it is someone to not do business with. I don't pirate it. I simply don't accept it.

Correlation != Causation

[johndiii]

It's not possible to do a controlled experiment in this context - to see if an otherwise similar group of individuals will buy more or fewer CDs if they do not have P2P access to music. So one cannot say whether or not such access reduces or enhances CD sales. It's quite plausible that the latter would happen, as a result of increasing immersion in the music culture, but it would seem to be very difficult to produce direct evidence.

However, this does reinforce the fairly obvious conclusion that the recording industry has chosen to use strongarm tactics on its best customers. It does not seem like the best of business models.

Well of course!

[Erpo]

there is a positive correlation between peer-to-peer downloading and CD purchasing.

Well of course. This study makes it perfectly clear that P2P downloading leads to CD purchasing, so P2P is obviously helping the music industry.

Wait a minute. Before P2P some people liked to buy a lot of CDs and some people didn't like to buy CDs at all. Those people who liked to buy a lot of CDs are now buying fewer CDs and downloading music illegally instead. Those people who didn't care much about music before are not downloading musically illegally because they don't want it very much. So P2P is obviously hurting the music industry.

Oh wait. I can come to two different opinions based on the same evidence depending on what mood I'm in and the people I listen to. Maybe I should recognize that it's totally possible to make a convincing argument for a statement that isn't true. Maybe I should re-evaluate some of the things I'm dead certain about.

Statistician-speak

[joel.neely]

I believe that the language quoted is typical of statisticians talking about the data (think "graph") rather than the underlying observed system. In other words, I believe one should read it as short-hand for

The segment of the sample which downloads X + 1 times per month was observed to purchase 0.44 CDs per year more than the segment of the sample which downloads X times per month.

I believe that professional statisticians and researchers understand the difference between describing 'the effect" of moving around on the graph of results (correlation) versus claiming cause and effect in the underlying system.

However, quibbling over statistician-speak is irrelevant to the key point that people who were observed to download more music were also observed to buy more CDs. This result drives a stake in the heart of the RIAA argument that people download music instead of purchasing CDs.

Conclusion : Don't piss off your best customers.

[DrYak]

However, it is important to remember that correlation does not equal causation. It seems just as probable, if not more so, that people who buy more CDs are more likely to engage in file sharing.

The fact is : users who happen to download a lot, happen to buy a lot too.
No matter which causes which, there's an important conclusion to be drawn for media companies :

Stop harassing downloaders, because currently, you happen to be pissing off you best buyers.
Yes we know you **AA hate people who "illegaly steal" your stuff, but those people happen to be those who buy most of your CDs anyway, so be nice with them.

Does this mean...

[adsl]

Does this correlation finding mean that the RIAA should pursue and find reasons to sue people who don't use P2P, because thse are the very people NOT buying CDs?

CDs are obsolete. Who cares how many are bought?

[presidenteloco]

Miraculous as they seemed in the 80s,
they are outclassed on a number of fronts by simple digital files,
as far as a consumer is concerned.
1. The digital file isn't tied to any particular physical object,
or player, or location. It's simpler. If I know part of its name,
I can be playing it a few seconds later.
2. The digital files can be more flexibly arranged in groups to different
tastes and purposes.
3. They can be stored on the Internet and communities of people
can review them, collate them very flexibly.
4. They don't encourage the production of cruft to fill extra
tracks on a CD album.

So why are we talking about CDs at all. That was so 80s.

The discussion should be how music artists should be compensated
in the post CD world.

I think Radiohead demonstrated the way forward.

The traditional music industry, by fighting an inevitable change,
is driving a stake into its own heart by guaranteeing its irrelevance.