Music piracy fall linked to lawsuit threat

Scott Morrison
January 05, 2004

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When the recording industry announced last year that it would start suing internet music pirates, critics argued that the record companies' controversial tactics would only alienate the very consumers on whom they depend.

But a study released at the weekend suggests the industry's high-profile lawsuits have dramatically curtailed Americans' online music-sharing habits.

The survey by the Pew Internet and American Life Project showed about 14 per cent of Americans downloaded music files over the internet in the four weeks ending on December 14. That compared with 29 per cent last May, just before the Recording Industry Association of America announced it was preparing to sue people who shared unauthorised music files over the internet.

"We have never seen another internet activity drop off to this degree," said Lee Rainie, director of Pew. "The drop-off was just striking, particularly since overall internet activity goes up and up."

But critics of the RIAA's controversial lawsuits say it is too early to draw any conclusions.

Fred von Lohmann of the Electronic Frontier Foundation, an internet users' campaigning group, noted that data from internet tracking services showed little decline in activity on online peer-to-peer services such as Kazaa.

It is impossible to know the true extent of the decline from the Pew survey. For example, the threat of legal action has made respondents a lot more wary about admitting they download music.

"Calling people today and asking them whether they have downloaded music is like calling people and asking them whether they have broken the law this week," said Mr von Lohmann.

But Mr Rainie pointed out that data from comScore Media Matrix, which measures internet use, supported his group's findings.

Those figures indicate a significant year-on-year decline in people running four of the most popular peer-to-peer file sharing applications on their computers.

But internet users may have adopted more furtive behaviour when swapping online music, shying away from the most widely used P2P software that the RIAA has targeted.

Others have started using software to protect themselves from the cyber-sleuths hired to track them down.

Since September the RIAA has filed hundreds of lawsuits against music pirates, claiming "egregious" copyright infringement and seeking up to $150,000 per violation. Many defendants have settled out of court for up to $10,000.

The Pew survey notes that a growing number of Americans are using a new generation of paid online music services, such as Apple's iTunes music store and the new Napster site.

But recent data from Nielsen SoundScan showed that the music industry's sales held steady last year after several years of plunging sales -- in large part due to online piracy. The data also showed that music sales had picked up since the RIAA's first lawsuits were filed.

"The ultimate success or failure of the RIAA campaign is not determined by whether or not fewer people are downloading, but whether or not it has prompted consumers to go flocking back to the music stores," said Mr von Lohmann.