There's a new study out (via
Michael Geist) about the relationship between peer-to-peer downloading and CD purchases
in Canada. The authors found a positive relationship between downloading and CD purchasing. That is, those who downloaded more music also tended to purchase more CDs. It's important to keep in mind that correlation does not prove causation. In particular, I suspect that much of what we're observing here is simply the fact that people have varying levels of interest in music, and those who are more interested in music are likely to both download more songs and purchase more CDs. So these results by no means prove that peer-to-peer file-sharing isn't hurting the recording industry. On the other hand, it certainly belies the recording industry's simplistic claim that no one will buy their music if it's available for free on peer-to-peer sites. Clearly, there are a lot of music fans in Canada who have access to peer-to-peer networks and choose to pay money for CDs anyway. That might be because they want the extras that come with the physical CD, because they feel good about supporting their favorite band, or because they expect the audio files on the CD to be higher quality than the music they find online. Whatever the reasons, the recording industry should be figuring out how to capitalize on them, by coming up with new products that offer perks
you can't get from a peer-to-peer network.