Study Contradicts Music
Industry's Piracy Claims

From The Washington Post

Two university researchers have released a study that indicates online music piracy has no negative effect on legitimate music sales, and in fact boosts sales in some cases.

"Consumption of music increases dramatically with the introduction of file sharing, but not everybody who likes to listen to music was a music customer before, so it's very important to separate the two," says Felix Oberholzer-Gee, an associate professor at Harvard Business School, who co-authored the study.

Oberholzer-Gee and his colleague, University of North Carolina professor Koleman Strumpf, say their "most pessimistic" statistical model indicates that only 2 million CD sales were lost due to illegal file-sharing in 2002, whereas CD sales declined by 139 million units between 2000 and 2002.

"From a statistical point of view, what this means is that there is no effect between downloading and sales," says Oberholzer-Gee.

The study's results contradict the recording industry's assertions that their financial decline is attributable in large part to music piracy, citing several studies that have supported that claim. However, some other research groups said the Harvard-UNC study conclusions appeared to mirror their own research findings. "While some people seemed to buy less after file sharing, more people seemed to buy more," says Jupiter Research analyst Aram Sinnreich, who conducted similar studies in 1999 and 2002.