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document
CD Sales Versus p2p Downloading
By The Space Cowboys and a Cowgirl
Cory Richford, Elle Winchester, Andrew LaPlante, and Micah Curtis

    RIAA has been spreading rumors that p2p was killing CD sales, while in fact the statistics for 2004 show that CD sales are up by 10.2 percent in 2004 as said by the RIAA. Is it that the RIAA is trying to blame the p2p communities for everything and just donít want to admit that they are helping with sales growth?
    In 2005 CD sales were down by 3.4% in terms of CD units sold, but would that 3.4% be covered by the 250% increase of legal downloads from 220 million in 2004 to 790 million in 2005? The RIAA is looking for a scapegoat and the p2p networks are the first candidate on their list. P2p is helping the sales of the music industry. Why canít the music industry just recognize p2p?
    The RIAA has been saying that perhaps iTunes and other pay per song sites are really destroying music sales.  Analysis shows that in fact CDnow.com, fye.com, and Bullmoose offer about the same price per CD that iTunes does.  In fact, keep in mind that Mp3s are not the source material that CDs would be so really to own the actual copy would probably cost more anyways.
    A lot of artists have even in fact embraced the iPod as well as record companies.  U2 released their own version of the iPod which was the 40 gig and cost the same, however their entire catalog was put on it, if you put together the total revenue from their released work you would get over $200 extra.  In fact, come to think of it, how much do the artists get for their record sales anyways? They recorded their work; at least let them do whatever they want with it.
    So what is the big deal about p2p downloading vs. CD sales?  . When you buy CDs you are supporting the artist.  If the customer legally downloads the songs then it is not against the law and they are still supporting the artist, so if you want to share that with your peers, it should not be a problem.  There were 790 million legal downloads in 2005, and in 2004 there were 220 million.  Out of these downloads itís almost certain that most people shared their music with others after they downloaded it.  You have to realize though, that most people will burn their CDs and share that music as well after they buy the CD.  Either way, there will be sharing of music, or the artist will be supported as well, so there really should not be that big of an issue.
    The RIAA has to understand that this problem is not something that is just going on in isolated parts of American and the thought of totally wiping out p2p is outrages. Tools such as iTunes have improved the problem by making people pay. Like stated before, which makes the problem better. RIAA is still making claims that there is still an issue with p2p. Their best case scenario is to wipe it out. They have to recognize legal downloads might have to turn into there final and best case solution to this issue.
Posted 2005-11-08 09:45:16 by Yvette Tardiff
Comments on this story... (toggle all)

Connecting the dots [Jon Ippolito, 2005-12-21 05:52:18]

This article includes plenty of interesting statistics and facts, particularly regarding how the number of legal downloads has increased over time, potentially offsetting the drop in CD sales.

That said, the tone of the article and its conclusions seem glib to me. From the labels' point of view, what is to guarantee that the music shared after songs are downloaded won't cut into CD sales?

You also have to consider that to date the labels haven't made much money off legal music downloads--mostly because the frontrunner, Apple's iTunes Music Store, negotiated a cut rate of 99 cents per song. Whether or not you and I think this is a fair price, the labels are used to getting much more--and that's not taking into account the cut Apple is getting. So I believe from the label's perspective the drop in CD sales is a "big deal."

That said, I agree that it's important to encourage or allow artists to share their work as they see fit. I think the lingering question is whether the record industry is the right agent to make this happen--and if so, what incentives, structures, or analysis would encourage them to abandon obsolete business models.

jon


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