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

By EDRi · March 27, 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

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