Widespread sharing of songs over the Internet does not reduce the overall amount spent on music purchases, and may even increase it, according to a study released released today.
The report by Jupiter Media Metrix, a high-tech consulting firm, challenges the assertions of the major music labels that the industry is being victimised by piracy of music over the Internet.
The music industry has led a fierce campaign against file-sharing services such as Napster - which has been shut down by the courts, but supplanted by others - claiming they erode the profits by copying music without paying royalties.
Last month, the International Federation of the Phonographic Industry said worldwide sales of albums fell last year for the first time since CDs were introduced into shops in the early 1980s, and blamed illegal piracy for the decline.
The Jupiter study found that while Internet file-swapping may deter some purchases, on balance the effect is not damaging to the industry.
"File sharing has a polarising effect on music spending, spurring increases among some users and decreases among others," said the report by Jupiter analyst Mr Aram Sinnreich.
"However, the boost outweighs the bust. Experienced file sharers were 75 per cent more likely than the average online music fan to have increased their music spending levels."
The latest report reached the same conclusion of a Jupiter study in mid-2000, which found that the then-soaring Napster service seemed to have a positive effect on music purchasing by consumers and that the recording industry was using Napster as a "scapegoat."
Jupiter attributed the five per cent drop in the value of music sales last year to "normal music market cyclicity," an overall drop in consumer spending and increased competition from other forms of entertainment, such as games and DVDs.
AFP