8 ms·

BitTorrent Piracy Boosts Music Sales, Study Finds

71 points by mrsebastian 14y ago

jstanley 14y ago
I find it more likely that good songs are both pirated more and bought more, rather than that the piracy increases the sales. Correlation, not causation.
- mistercow 14y ago
  From the paper, which apparently nobody here actually bothered to skim: > To study this phenomenon, I must overcome the fact that ﬁle sharing is endogenous in its determination of an album’s sales because an album that is popular in ﬁle-sharing networks will also be popular in retail markets. This occurs because ﬁle-sharing and retail demand are both driven by unobserved album quality. To address this endogeneity, I exploit exogenous variation inhow widely available an album was prior to its oﬃcial release date. An album’s ease of availability in ﬁle-sharing networks is positively correlated with the number of times that it is downloaded because availability determines the supply of the album in ﬁle-sharing networks. Availability is not independently correlated with an album’s popularity in retail markets because pre-release ﬁlesharing is driven by leaks, which are “crimes of opportunity” that occur at some stage of the production or album marketing process (Williams, 2009).
Mahh 14y ago
This reads like a post that exists just so that people pirating music can give themselves an excuse to keep doing so. I'd be interested in seeing the process that Hammond took to establish this relationship between pre release piracy and album sales. It says causal, but it seems like you can't truly control for all of the variables when you're dealing with phenomena in society. One thing that sort of makes me itch is that the reported benefit of a one month in advance leak is a value rather than a ratio. It seems like a figure like that lets weight ruin the measure -- an album that was popular anyway will weight heavily when it comes down to the expected value.
- teamonkey 14y ago
  Two problems I see with this are that he only uses one source for pirate figures - a private tracker specializing in sharing music - and focuses on pre-release leaks. These would both imply a link with music fans and not the piracy market as a whole.
- mohsen 14y ago
  I'm not sure about this study, but there are cases where 'illegal' downloads have actually helped the producer of the product have better sales. When Radiohead came out Kid A the reviews considered the album "Just Awful"[1]. And I think that they never had any music videos or singles for the album, but a leak before the official release of the album gave people a chance to give the album a real shot. They liked it and they bought it. Kid A was Radioheads first release that became number one in the US and it also went platinum in the UK. [1] http://www.guardian.co.uk/friday_review/story/0,,371289,00.html http://www.guardian.co.uk/friday_review/story/0,,371289,00.h...
  - res0nat0r 14y ago
    The reason it went number one is because it was a new album from Radiohead. Also people wouldn't have given it a real shot after the official release date?
    - mohsen 14y ago
      Actually Kid A was the first album that made almost a genre change, which is why people considered it 'awful' in the first place: they were expecting the same old Radiohead and they got something completely different. So yes, had they released an album similar to the previous three, I would agree with you, but what they did was quiet risky and the free downloads allowed people to give it a chance.
Rudism 14y ago
I sometimes wonder if this whole thing isn't sort of a catch-22 for the record labels. It seems somewhat intuitive that greater piracy/sharing would lead to more exposure and more sales, but how many of those sales are driven by people who use file sharing as a means of music discovery, then purchase their favorites out of guilt? If the record labels acquiesce and begin to embrace file sharing as another method of exposure, that guilt-factor would evaporate because now torrenting isn't "wrong" anymore, thus eliminating those increased sales.
- DanBC 14y ago
  I don't buy things after torrenting because I feel guilty for torrenting. I buy things after torrenting because I like those things. If I dislike those things I delete them and don't buy them.
  - tripzilch 14y ago
    Additionally I make sure that the money I pay goes as directly as possible to the record label and/or artist. Usually the music I find worth buying is from smaller labels or independent artists, and I really wonder how any money I could pay to, say, Spotify would hypothetically find its way to them.
    - DanBC 14y ago
      Yes. Sometimes music isn't easily available, and in those cases I'd try to buy modern versions or merch.
  - res0nat0r 14y ago
    And you also just screwed the artists you didn't like out of cash. Note: before you say you wouldn't have bought them anyway...that's how it works. You either listen to it on the radio / youtube etc for free. Then get to own the whole pristine mp3 version of it after you pay for it, not before.
    - DanBC 14y ago
runn1ng 14y ago
It is on torrentfreak. Expecting this site to be fair and balanced is like expecting the same from RIAA website.
- cnbeuiwx 14y ago
  Nothing is fair and balanced. Isnt that a Fox News expression by the way? They are mocking the viewers but they dont even understand it. :)
  - runn1ng 14y ago
    yeah, but a news on riaa website won't get to the frontpage of hackernews.
    - beagle3 14y ago
      but it does get on the every mainstream media outlet. And on the lawmakers' desk.
      - cobrausn 14y ago
        We should be combating spin with facts, not more spin. Otherwise you are part of the problem.
        beagle3 14y ago
        I used to believe that too. But my experience over the last twenty years it that anyone without specific interest in the problem tends to average everything they here and assume that's where the truth lies. So the product of (amount of editorializing)*(how much noise you make) should balance the other side. There are non-linear effects - e.g., you lose listeners if you editorialize too much, ("RIAA is killing babies", which might be plausible with some chain of reasoning that includes far fetched assumptions and highly improbable assumptions, but not entirely invalid deductions). But basically everywhere, and especially in American politics, being calm and factual is a guaranteed way to lose the vote, regardless of how right you are.
paulhauggis 14y ago
You also can't discount the fact that when Napster came out, music sales as a whole dropped like a rock. I don't think I knew anyone that bought music after this. Anything digital (like movies, music, or software) is only as valuable as what people are willing to pay. Look at the iPhone apps market. Because most apps are under $10, you will have a hard time selling an app above this price point. The same thing will happen if the record industry embraces piracy. People will just expect to get it for free from then on. It will be very difficult to convince them otherwise. It's difficult for me to respect a community that feels entitled to someone else's hard work (and without their permission). If they really want to make a difference, compete with the record labels. Create a record label with signed artists that gives their music out for free on the torrent networks. I know this will never happen because it takes too much discipline and hard work. The community also doesn't really care about the artist. If they did, they would have come up with some sort of solution for artists to make a living in the past 12 years (Napster launched in '99). Until They can show me otherwise, I feel that the entire point of the community is so they can get things for free.
- icebraining 14y ago
  You also can't discount the fact that when Napster came out, music sales as a whole dropped like a rock. By "dropping like a rock", you mean the 5% and 6.9% in 2000 and 2001, respectively? If they really want to make a difference, compete with the record labels. Create a record label with signed artists that gives their music out for free on the torrent networks. I know this will never happen because it takes too much discipline and hard work. Yes, record labels that give music out for free "will never happen": http://creativecommons.org/record-labels http://creativecommons.org/record-labels The community also doesn't really care about the artist. If they did, they would have come up with some sort of solution for artists to make a living in the past 12 years (Napster launched in '99). It already exists. In the UK, for example, artists revenue has been rising steadily: http://3.bp.blogspot.com/-1PEuVy75dqs/Txt6vy4ZlmI/AAAAAAAAAD4/EEejctW0bW4/s1600/screenshot-11.png http://3.bp.blogspot.com/-1PEuVy75dqs/Txt6vy4ZlmI/AAAAAAAAAD... Album sales are not the only way they make money.
  - masklinn 14y ago
J3L2404 14y ago
I would like to thank pg for inviting the barrage of these stories and the type of users it brings to HN. Kill Hollywood? You might as well have Henry Ford saying 'Kill Horses'. When a viable alternative exists it will gradually replace the labels. Just like every other industry.
jiggy2011 14y ago
I'm not quite sure I understand the statistics here, seems to me that they are basically saying "stuff that is popular with pirates pre-release is also popular for purchase post-release" which is not exactly a revelation. It also doesn't seem to account for total revenue rather than just total sales.
Tycho 14y ago
Hmm, but did they get bigger sales because they were leaked? Or did they get leaked because they were in more demand in the first place? Also it doesn't really matter because the core of the argument will always be individual rights and control of intellectual property.
- mistercow 14y ago
  >Also it doesn't really matter because the core of the argument will always be individual rights and control of intellectual property. Not really. That may be the core of the argument for the idealists, but the core of the argument for the pragmatic is "harm to the economy", and the core of the argument for the politicians is "appeasing those wealthy campaign donors". Individual rights have very little to do with modern American government.
taylorlb 14y ago
The headline is a bit misleading for what is actually a somewhat interesting study on the effect of leaks on album sales (rather than post-release piracy on music sales in general). I've long believed that a leak of a great album can help generate buzz and ultimately sales for a new record since the people who would be most likely to evangelize the record would also be the same people who would be most excited to download it pre-release. It goes both ways though, a leak that exposes a record as being sub-par pre-release can have a devastating effect.

71 points by mrsebastian 14y ago

I find it more likely that good songs are both pirated more and bought more, rather than that the piracy increases the sales. Correlation, not causation.

mistercow 14y ago
From the paper, which apparently nobody here actually bothered to skim: > To study this phenomenon, I must overcome the fact that ﬁle sharing is endogenous in its determination of an album’s sales because an album that is popular in ﬁle-sharing networks will also be popular in retail markets. This occurs because ﬁle-sharing and retail demand are both driven by unobserved album quality. To address this endogeneity, I exploit exogenous variation inhow widely available an album was prior to its oﬃcial release date. An album’s ease of availability in ﬁle-sharing networks is positively correlated with the number of times that it is downloaded because availability determines the supply of the album in ﬁle-sharing networks. Availability is not independently correlated with an album’s popularity in retail markets because pre-release ﬁlesharing is driven by leaks, which are “crimes of opportunity” that occur at some stage of the production or album marketing process (Williams, 2009).

Mahh 14y ago

This reads like a post that exists just so that people pirating music can give themselves an excuse to keep doing so. I'd be interested in seeing the process that Hammond took to establish this relationship between pre release piracy and album sales. It says causal, but it seems like you can't truly control for all of the variables when you're dealing with phenomena in society. One thing that sort of makes me itch is that the reported benefit of a one month in advance leak is a value rather than a ratio. It seems like a figure like that lets weight ruin the measure -- an album that was popular anyway will weight heavily when it comes down to the expected value.

teamonkey 14y ago
Two problems I see with this are that he only uses one source for pirate figures - a private tracker specializing in sharing music - and focuses on pre-release leaks. These would both imply a link with music fans and not the piracy market as a whole.
mohsen 14y ago
I'm not sure about this study, but there are cases where 'illegal' downloads have actually helped the producer of the product have better sales. When Radiohead came out Kid A the reviews considered the album "Just Awful"[1]. And I think that they never had any music videos or singles for the album, but a leak before the official release of the album gave people a chance to give the album a real shot. They liked it and they bought it. Kid A was Radioheads first release that became number one in the US and it also went platinum in the UK. [1] http://www.guardian.co.uk/friday_review/story/0,,371289,00.html http://www.guardian.co.uk/friday_review/story/0,,371289,00.h...
- res0nat0r 14y ago
  The reason it went number one is because it was a new album from Radiohead. Also people wouldn't have given it a real shot after the official release date?
  - mohsen 14y ago
    Actually Kid A was the first album that made almost a genre change, which is why people considered it 'awful' in the first place: they were expecting the same old Radiohead and they got something completely different. So yes, had they released an album similar to the previous three, I would agree with you, but what they did was quiet risky and the free downloads allowed people to give it a chance.

Rudism 14y ago

I sometimes wonder if this whole thing isn't sort of a catch-22 for the record labels. It seems somewhat intuitive that greater piracy/sharing would lead to more exposure and more sales, but how many of those sales are driven by people who use file sharing as a means of music discovery, then purchase their favorites out of guilt? If the record labels acquiesce and begin to embrace file sharing as another method of exposure, that guilt-factor would evaporate because now torrenting isn't "wrong" anymore, thus eliminating those increased sales.

DanBC 14y ago
I don't buy things after torrenting because I feel guilty for torrenting. I buy things after torrenting because I like those things. If I dislike those things I delete them and don't buy them.
- tripzilch 14y ago
  Additionally I make sure that the money I pay goes as directly as possible to the record label and/or artist. Usually the music I find worth buying is from smaller labels or independent artists, and I really wonder how any money I could pay to, say, Spotify would hypothetically find its way to them.
  - DanBC 14y ago
    Yes. Sometimes music isn't easily available, and in those cases I'd try to buy modern versions or merch.
- res0nat0r 14y ago
  And you also just screwed the artists you didn't like out of cash. Note: before you say you wouldn't have bought them anyway...that's how it works. You either listen to it on the radio / youtube etc for free. Then get to own the whole pristine mp3 version of it after you pay for it, not before.
  - DanBC 14y ago

runn1ng 14y ago

It is on torrentfreak. Expecting this site to be fair and balanced is like expecting the same from RIAA website.

cnbeuiwx 14y ago
Nothing is fair and balanced. Isnt that a Fox News expression by the way? They are mocking the viewers but they dont even understand it. :)
- runn1ng 14y ago
  yeah, but a news on riaa website won't get to the frontpage of hackernews.
  - beagle3 14y ago
    but it does get on the every mainstream media outlet. And on the lawmakers' desk.
    - cobrausn 14y ago
      We should be combating spin with facts, not more spin. Otherwise you are part of the problem.
      - beagle3 14y ago
        I used to believe that too. But my experience over the last twenty years it that anyone without specific interest in the problem tends to average everything they here and assume that's where the truth lies. So the product of (amount of editorializing)*(how much noise you make) should balance the other side. There are non-linear effects - e.g., you lose listeners if you editorialize too much, ("RIAA is killing babies", which might be plausible with some chain of reasoning that includes far fetched assumptions and highly improbable assumptions, but not entirely invalid deductions). But basically everywhere, and especially in American politics, being calm and factual is a guaranteed way to lose the vote, regardless of how right you are.

paulhauggis 14y ago

You also can't discount the fact that when Napster came out, music sales as a whole dropped like a rock. I don't think I knew anyone that bought music after this. Anything digital (like movies, music, or software) is only as valuable as what people are willing to pay. Look at the iPhone apps market. Because most apps are under $10, you will have a hard time selling an app above this price point. The same thing will happen if the record industry embraces piracy. People will just expect to get it for free from then on. It will be very difficult to convince them otherwise. It's difficult for me to respect a community that feels entitled to someone else's hard work (and without their permission). If they really want to make a difference, compete with the record labels. Create a record label with signed artists that gives their music out for free on the torrent networks. I know this will never happen because it takes too much discipline and hard work. The community also doesn't really care about the artist. If they did, they would have come up with some sort of solution for artists to make a living in the past 12 years (Napster launched in '99). Until They can show me otherwise, I feel that the entire point of the community is so they can get things for free.

icebraining 14y ago
You also can't discount the fact that when Napster came out, music sales as a whole dropped like a rock. By "dropping like a rock", you mean the 5% and 6.9% in 2000 and 2001, respectively? If they really want to make a difference, compete with the record labels. Create a record label with signed artists that gives their music out for free on the torrent networks. I know this will never happen because it takes too much discipline and hard work. Yes, record labels that give music out for free "will never happen": http://creativecommons.org/record-labels http://creativecommons.org/record-labels The community also doesn't really care about the artist. If they did, they would have come up with some sort of solution for artists to make a living in the past 12 years (Napster launched in '99). It already exists. In the UK, for example, artists revenue has been rising steadily: http://3.bp.blogspot.com/-1PEuVy75dqs/Txt6vy4ZlmI/AAAAAAAAAD4/EEejctW0bW4/s1600/screenshot-11.png http://3.bp.blogspot.com/-1PEuVy75dqs/Txt6vy4ZlmI/AAAAAAAAAD... Album sales are not the only way they make money.
- masklinn 14y ago

J3L2404 14y ago

I would like to thank pg for inviting the barrage of these stories and the type of users it brings to HN. Kill Hollywood? You might as well have Henry Ford saying 'Kill Horses'. When a viable alternative exists it will gradually replace the labels. Just like every other industry.

jiggy2011 14y ago

I'm not quite sure I understand the statistics here, seems to me that they are basically saying "stuff that is popular with pirates pre-release is also popular for purchase post-release" which is not exactly a revelation. It also doesn't seem to account for total revenue rather than just total sales.

Tycho 14y ago

Hmm, but did they get bigger sales because they were leaked? Or did they get leaked because they were in more demand in the first place? Also it doesn't really matter because the core of the argument will always be individual rights and control of intellectual property.

mistercow 14y ago
>Also it doesn't really matter because the core of the argument will always be individual rights and control of intellectual property. Not really. That may be the core of the argument for the idealists, but the core of the argument for the pragmatic is "harm to the economy", and the core of the argument for the politicians is "appeasing those wealthy campaign donors". Individual rights have very little to do with modern American government.

taylorlb 14y ago

The headline is a bit misleading for what is actually a somewhat interesting study on the effect of leaks on album sales (rather than post-release piracy on music sales in general). I've long believed that a leak of a great album can help generate buzz and ultimately sales for a new record since the people who would be most likely to evangelize the record would also be the same people who would be most excited to download it pre-release. It goes both ways though, a leak that exposes a record as being sub-par pre-release can have a devastating effect.