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The loss of LimeWire has P2P pirates on the run.  (Source: Walt Disney)
But are pirates turning to YouTube and elsewhere

The NPD Group, a top market analytics research firm has released a new study [press release] that might surprise some.  It claims that in 2010 the rate of users who pirate content on peer-to-peer (P2P) networks dropped to 9 percent, down drastically from 16 percent reported in 2007.  This marks a dramatic reversal of the trend of increasing piracy rates in recent years.

The report argues that piracy is not a "fundamental" problem for the media industry, given the relatively low levels.  This stands in stark contrast to statements in the Digital Media Report 2010 [PDF] by the International Federation of the Phonographic Industry (IFPI), the parent organization of America's RIAA.  The IFPI stated in the report, "[The industry will] struggle to survive unless we address the fundamental problem of piracy."

Warner Music, a RIAA member takes a bit more conservative approach.  In a recent presentation to the U.S. Federal Communications Commission, Warner suggested that only 13 percent of Americans pirate.  The Warner report also offers some disclaimers about the harmful impact of pirates, stating that most pirates do spend money on content and that they "tend to drive high discovery for others".

The numbers from the NPD Group are admittedly slanted, though, due to a significant event in the industry.  They were taken from the final quarter of 2010, when the RIAA scored a major lawsuit win that forced the U.S.'s most popular P2P client, LimeWire, to cease distribution.  Thus the dip in P2P filesharing may be only temporary, due to the loss of one of the highest profile clients.

States Russ Crupnick, entertainment industry analyst for NPD, "Limewire was so popular for music file trading, and for so long, that its closure has had a powerful and immediate effect on the number of people downloading music files from peer-to-peer services and curtailed the amount being swapped. In the past, we've noted that hard-core peer-to-peer users would quickly move to other Web sites that offered illegal music file sharing. It will be interesting to see if services like Frostwire and Bittorrent take up the slack left by Limewire, or if peer-to-peer music downloaders instead move on to other modes of acquiring or listening to music."

Today, many of the most used clients are unofficial community releases of past P2P clients that were banned by lawsuits.  Examples include Kazaa Lite and WireShare (formerly LimeWire Pirate Edition), etc.  According to the NPD Group's data, FrostWire (traditional P2P) and uTorrent (Torrent P2P) increased in use, as well, in the wake of the Limewire shutdown.

While the study did consider BitTorrent traffic (a specialized P2P protocol), it did not consider new forms of illegal content distribution, such as one-click downloads, illegally streamed content, such as unauthorized posts to video sharing sites like YouTube.  The latter seems particularly prevalent, as you can go to YouTube and find virtually any song you can imagine -- mostly from unofficial user-submitted uploads (though the major label industry does maintain an official presence on the site via channels like Vevo).

Media organizations have tried unsuccessfully to sue YouTube's owner Google over such posts.  The television industry championed the biggest such case, when Viacom sued Google, demanding $1B USD in damages for pirated content hosted on YouTube.  The media giant's case fell apart, though, after it came out that Viacom employees uploaded content under fake screennames to make it look like infringed content.

The study also only surveyed those 13 and up.



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RE: Forget being a "fundamental" problem...
By kmmatney on 3/24/2011 11:11:43 AM , Rating: 2
I'm really wondering how old you are. In the 80's and 90's (before downloading of music, and ripping CDs) we actually bought music. It was expensive too. I often had to decide between buying an album, or eating. And I'd usually buy the album and then have to borrow spaghetti from a room mate. It sucked to get burned on an album with only a few good songs, but you had to live with that.

Now, I don't pay for a lot of music that I probably would have. Its as simple as that. Good for me, but not good for the music industry.

Just look at music sales before and after piracy. Top selling albums routinely hit 20 million sales in the 80's and 90's. Now they never even come close to that.

I'm not a fan of the music industry, and they killed themselves but raising prices on CDs when sales started to fall. But there is no doubt Napster, and everything that came after really killed them.


RE: Forget being a "fundamental" problem...
By Motoman on 3/24/2011 11:27:35 AM , Rating: 4
Close to 40, for the record.

I have a CD collection of a few hundred albums.

Of those, maybe 10 were bought in the last 10 years.

I don't get pirated music, and I don't buy downloads - if I want something, I'll buy the physical CD. I don't really have much interest in having much of the music that's been produced recently. And I'm really put-off by the fact that some recent CDs I did buy had such crappy DRM on them that I couldn't easily rip them to .mp3. The solution is simple - the industry doesn't get my money.

You can pretend that the downfall of CD sales is piracy all you want. But the real reason is a combination the success of online music sales, in which CDs don't move out of the stores, and a general disinterest by the buying public, high CD prices, and a distaste for DRM.


By wordsworm on 3/25/2011 10:43:26 AM , Rating: 2
That's the right way to protest something. Don't steal it. Don't buy it. I think your method of protest is commendable.

I'm 35. That makes me just young enough to have caught the vinyl dump craze: so many great albums for 25 cents... it's kind of sad that that will never happen again. I'm not a big fan of what's hip and haven't been for a long time. I really enjoy modern music: Sia, Zero 7, Emelie Simon, and even some commercially successful groups like The White Stripes, are really quite good.


By Iaiken on 3/24/2011 1:56:37 PM , Rating: 2
quote:
Top selling albums routinely hit 20 million sales in the 80's and 90's. Now they never even come close to that.


This was a bogus comparison before you even got to the second sentence.

On a per year basis, there were between 0-4 albums that would sell over 20 million copies. These albums made up for around 0.005% of the total number of albums each year, but accounted for anywhere up to 20% of the total album sales.

What's more, the sales were of entire albums for ~$20 usually to get 1-3 good songs. Today you can get those three songs for $1-2 each and save yourself the other $14-17. In reality, sales of entire albums have suffered more because discerning buyers will purchase only those songs they want and pan the rest of the album.

This is no longer the case and the chances that an individual artist seizes as much of the market as artists in the past are slim. This is largely because consumers are now faced with a greater and more varied selection to choose from. In the past, people would mostly buy what they heard on the radio and the record companies where the gatekeepers of what ultimately made it on the radio. Today, the gate is gone and people are swamped with choices.

I still budget around $200 a year for music and that's about what I've spent every year since 1995 when I entered high school. Back then, that would get me 8-9 albums with 16-36 songs that I actually wanted to listen to. These days, I get anywhere from 100-200 songs for the same price. None of these are counted towards albums sales despite representing 60-100 different albums.

I'm sorry, but just because consumers have been given greater choice doesn't mean we will make greater sales. Instead, those sales will be made in a more discerning fashion and dispersed across a greater number of albums, artists and ages.


By bigboxes on 3/24/2011 8:00:12 PM , Rating: 2
In reality, we often shared our music with others. Instead of downloading off of the internet we would tape a record or copy a tape for a friend. Remember mixed tapes? Yeah, no sharing went on before Napster. :eyeroll: And it was all legal! As long as your weren't selling for profit. A friend of mine told me when he was younger that he and his buddies pooled their money to purchase an import album at their local record shop and then made copies on to tape for everyone. I don't support scum that sell others people's work. To me that is theft. But if you copy and give it away for free it should be legal.

As for the "Would you steal a car?" analogy, of course I would steal a car... if I could get away with it! Duh! But I'm not a criminal and don't like prison.


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