April 10th, 2005

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Music
3 Comments »

Debunking Peer-to-Peer Myths

Via Slashdot, here’s a great article about the Canadian music industry and its apparent losses due to illegal downloading. It’s written by Canadian law professor Michael Geist. He wins you over with a detailed analysis of the CRIA’s statistical house of cards:

Assuming artists receive the full 12 percent royalty, the annual royalty loss attributable to music downloading in Canada is about C$655,000 (12 percent of C$5.5 million). For those that claim that the full industry loss should be counted, the annual lost royalty for Canadian artists stands at C$2 million.

Numbers can lie, but I don’t think they’re doing so here.

Comments: 3 Responses so far

Olaf
April 11th, 2005
7:09 am

What’s not accounted for is the percentage of sales that would never have occured anyway. Just because people download music for free doesn’t mean that they’d otherwise have purchased it.

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Derek
April 12th, 2005
12:54 am

Especially if it turns out to suck.

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Nick
April 12th, 2005
11:11 am

You could also turn this argument on it’s head. Say you assume that every single CD produced for sale in Canada was purchased then this would be the sum total of all possible dollars which the record industry could garner (I’m not even accounting for all the possible CD’s that could be manufactured by pressing plants running 24 hours a day at full capacity).

Obviously not all CD’s pressed are purchased. Consumers make choices every day.Shall I pay rent or purchase a CD?
How many possible royalty dollars are lost when consumers make a choice to spend their discretionary income on something other than a CD?

Behind all this nonsense about downloading is an assumption that record companies are entitled to the maximum possible dollars for their product.

Well I apologise for plunking down that $25 for that last restaurant meal instead of buying a CD.

Perhaps I should aplogise to all the restaurants that didn’t get my patronage because of all the thousands od CD’s I’ve purchased over the years.

Provide a good product at a good price and generally you’ll have a thriving industry.

As an aside an eye-opening article in the New York Times about a record company spending close on $13 million US on Axl’s CD(still not recorded) doesn’t seem to get people all riled up. Now there’s a ton of money down the drain!

[Reply]

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