UK Study: Downloaders Buy More Music

A belated Tuneful Tuesday post. A recent UK study confirms what we’ve known all along:

"Computer-literate music fans who
illegally share tracks over the internet also spend four and a half times as
much on digital music as those who do not, according to research published
today.

The survey confirms what many music fans have informally insisted for some
time: that downloading tracks illegally has also led them to become more
enthusiastic buyers of singles and albums online.

Unlikely to be music to the ears of record companies, who have previously
argued the opposite, the results will raise a question mark over the companies’
recent drive to pursue individual file sharers through the courts."

According to the study, music fans who regularly share and download music illegally — active P2P users — typically
spend over 400% more on legal music downloads
than other music fans.

Speaking from personal experience, I have never discovered or purchased more music than I did during the heyday of Napster.

Paul Brindley, one of the authors of the study, noted "There’s a myth that all illegal downloaders are mercenaries hell-bent on breaking the law in pursuit of free music. In reality, they are often hardcore fans who are extremely enthusiastic about adopting paid-for services as long as they are suitably compelling."

>

Sources:
The Leading Question
http://www.theleadingquestion.com/

Music pirates spend four-and-a-half times more on legitimate music downloads than average fans
http://www.musically.com/theleadingquestion/files/theleadingquestion_piracy.doc

Radio is still the number one source for finding out about new music
http://www.musically.com/theleadingquestion/files/theleadingquestion_radio.doc

Downloading ‘myths’ challenged
BBC
NEWS,Published:
2005/07/27 08:10:56 GMT
http://news.bbc.co.uk/1/hi/technology/4718249.stm

Online file sharers ‘buy more music’
Owen Gibson, media correspondent
The Guardian , Wednesday July 27, 2005
http://media.guardian.co.uk/city/story/0,7497,1536889,00.html

File sharers ‘spend more on music downloads’
By Tony Smith (tony.smith at theregister.co.uk)
Published Wednesday 27th July 2005
http://www.theregister.co.uk/2005/07/27/p2p_users_legal_downloads

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Give It Away

I get some interesting questions about my interest in music/film. (You may have noticed that commentary on this subject tends to run on Tuesdays). In particular, I find the intersection between technology and entertainment to be fascinating. Clearly, its been a huge driver of so many new innovations and products, from iPods to plasma screens to TiVos.   

Understand where my criticisms of the recording industry come from: While I am interested in music and film as a fan, my issues with some of the poor decision making of the labels and studios comes from a business/investment perspective.

As an investor, I want to know how the Labels have managed their key assets, how they have strategized, what their  business model is for the future, how they incorporated new technology, what their responses are to changing consumer tastes. 

In short, they have done a horrible job. Not just recently, but historically. The recording industry has failed to recognize several key ideas:   

- all business models are temporary;
- change is ever present;
- adapt or die.

On that note, I would like to share a terrific commentary/rant from music industry insider Bob Lefsetz. His take on the Music Industry’s failure to adapt to P2P and other new tech is fascinating:

Give It Away
"Call it the Metallica Rule.  When you can’t get arrested, give it
away.  When you’re a star, arrest people for stealing your music.

Radio’s over.  The model is done.  Unless iPods start coming with
commercials  and every Internet radio station has to have twenty
minutes of ads, terrestrial radio is done.  Oh, it will survive in a
fashion.  As a place for news and talk.  But for music it’s history.

OH NO, you say. It’s in all those cars!

Don’t be a fucking idiot.  Of course radio counts today. But if
you’re thinking about today, you’re just as dumb as the major labels.
Because really, it’s what’s gonna happen TOMORROW!

Look at major label release schedules.  It’s not like the seventies
anymore.  If something doesn’t have hit potential, it doesn’t come
out.  Furthermore, that which DOES come out is tweaked endlessly,
making it palatable for sporting events and fashion shows, but it lacks
that one essential ingredient of TRUE hit music…it doesn’t touch your
soul.

It’s all about the bottom line . . . 

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