IP Outreach Research > IP Crime
Reference
| Title: | Whatever happened to payola? An empirical analysis of online music sharing |
| Author: | Sudip Bhattacharjee, Ram D Gopal and James R Marsden [University of Connecticut], Kaveepan Lertwachara [California Polytechnic State University] |
| Source: | Decision Support Systems 42, no. 1: 104-120 |
| Year: | 2006 |
Details
| Subject/Type: | Piracy |
| Focus: | Music |
| Country/Territory: | United States of America |
| Objective: | To investigate whether online music sharing amounts to "lost sales piracy" or "pre-purchase sampling piracy". |
| Sample: | 196 Billboard Top 100 albums tracked on WinMX |
| Methodology: | Passive online tracking |
Main Findings
The study observed significant piracy opportunity and activity on the peer-to-peer (P2P) network tracked. Levels of file sharing opportunities were related to the albums’ relative Billboard chart positions: the higher the chart ranking, the greater its availability.
Sharing activity levels provided leading indicators of the direction of movement of albums on the Billboard charts: with a two-week delay, chart rankings reflected prior file-sharing activity.
These results let the authors conclude that P2P file sharing consists of both “lost-sales piracy” and “pre-purchase sampling piracy”: while users certainly download and subsequently share popular music instead of purchasing the album legally, music sharing also allows “trial listening”, providing positive sampling (advertising) opportunities to the music industry, leading to album purchases.
In view of the fact that P2P file sharing is more than “pure piracy”, the authors recommend that record companies look further into this sampling that costs them nothing and reaches a very wide audience: with a zero or near-zero marginal cost product, are the suppliers better off with higher sales combined with piracy than with lower sales and no piracy? Strategies should aim at fostering pre-purchase sampling/advertising aspects of online sharing while minimising the lost-sales effects.
They also encourage leveraging file-sharing activity as an indicator of consumer interest and subsequent sales of music albums, permitting companies to make better marketing decisions.
[Date Added: Oct 22, 2008 ]