New Study Says Leaked Albums From Popular Artists Lead To More Sales

from the interesting-findings dept

TorrentFreak alerts us to an interesting new research paper from Robert Hammond, an assistant professor at North Carolina State University, looking at the direct impact on sales when albums are leaked early online. The study is pretty thorough in trying to separate other factors and isolate the actual causal impact. It's a bit of an extrapolation to claim that the study says "file sharing boosts music sales," as I don't think the paper actually goes that far. It seems to suggest, however, that for popular artists, having an album leaked appears to lead to a small, but significant, increase in sales. The impact is not seen for newer or less-well-known artists.
To put this result into context, consider the effect of leaking one month earlier on the sales of an album; that is, predict the effect of leaking one month earlier on the number of additional seeders per leecher, then predict the effect of these additional seeders on the number of additional downloads, then finally predict the effect of these additional downloads on the number of additional sales. This exercise predicts that an album that leaked one month earlier will receive 59.6 additional sales.
The report is interesting in that it uses a different, and perhaps much more revealing, data set. Hammond got the data from a popular private tracker that is well known for pre-release works. He claims, quite reasonably, that this means his results are much more useful than other studies that rely on proxies that may not be as accurate.

That said, the report notes that other that other sources of marketing seem to have a larger impact than file sharing. The study is interesting in that it at least challenges a few other reports that have argued that file sharing leads to fewer sales (and even a report that claims that the entirety of the decline in recorded music sales is due to file sharing). While Hammond mentions this particular study, by economist Stan Liebowitz (a vocal supporter of the entertainment industry's position on file sharing), he notes that the two were studying different things -- one macro and one micro. It's also worth noting that Hammond appears to have had Liebowitz review his study before publishing it (though who knows what he said about it).

I think the results here are interesting, but it still does seem like an area of research that needs a lot more focus, as I would bet there are many additional variables at work here, as we've discussed. We've seen that artists that do a good job connecting with their fans, and giving them a reason to buy, seem to see an increase in sales -- and that's independent of how the content is leaked or released (mostly, since you could argue that having the content available is one way of connecting).

Filed Under: file sharing, leak, robert hammond

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  1. identicon
    Anonymous Coward, 19 May 2012 @ 8:29am

    Re: Re: Re:

    Only to you is it pretty obvious.

    A current hot release is naturally going to sell way less than they use to. Why? Unbundling. I and the rest of the people on the planet no longer have to buy an entire album just for the one song we want off it. We can go to Amazon or iTunes and get it by itself for $.99 as opposed to paying $15 for an album we don't want.

    In fact, that's basically why recorded music sales are way off. People are no longer forced to buy stuff they don't want. That and you know... economic recession, competition from movies, television, the internet, video games, etc. There is at this point in time more entertainment readily available both free and paid than at any other point in history. It's only natural that there will be some casualties. Hmm. Pay $15 for an album or buy a few books? Or rent a couple of games? Or use that money to go bowling? Or have an online video chat with a friend while we play Tetrinet?

    But it's much easier to blame piracy than actual competition, right?

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