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Online piracy is not to be blamed for the drop in music revenues

27 March, 2013

This article is also available in:
Deutsch: Online-Piraterie nicht schuld an rückläufigen Musikumsätzen

As continuously argued by different IT specialists, digital freedom activists and organisations during the last few years, online piracy does not affect music industry revenues, as it is shown by a new research performed by The Institute for Prospective Technological Studies which is part of European Commission’s Joint Research Centre.

After having examined the browsing habits of 16 000 Europeans, the researchers found there is actually a positive relationship between online piracy and visits to legal music stores.

“It seems that the majority of the music that is consumed illegally by the individuals in our sample would not have been purchased if illegal downloading websites were not available to them,” says the paper in published by the researchers which is entitled “Digital Music Consumption on the Internet: Evidence from Clickstream Data”.

The relationship between online piracy and music stores was established by comparing the users’ visits to allegedly illegal sites and to the legal music stores and the conclusion was that those visiting alleged illegal sites are likely to visit legal stores as well. Online streaming seems to have a stimulating effect on the sales of digital music.

“If this estimate is given a causal interpretation, it means that clicks on legal purchase websites would have been 2 percent lower in the absence of illegal downloading websites,” says the research. While admitting that other external factors might influence these effects, the researchers conclude that, in any case, there is no evidence that online piracy is damaging for the music industry sales. The paper also points out that “digital music piracy does not displace legal music purchases in digital format. This means that although there is trespassing of private property rights, there is unlikely to be much harm done on digital music revenues.”

This paper is very useful in the ongoing copyright enforcement debate in Europe representing good arguments against increased surveillance and policing of copyrighted content.

JRC report - Digital Music Consumption on the Internet: Evidence from Clickstream Data (2013)

Online Music Piracy Doesn’t Hurt Sales, European Commission Finds (18.03.2013)

Spotify Is Now Smearing That EU Study on Piracy... (21.03.2013)



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