A blog post yesterday referred to an Industry Canada paper by Birgitte Andersen and Marion Frenz from Birkbeck College in London which appeared to claim the reverse. In a doubting comment, I mentioned Stan Liebowitz, an expert from the University of Texas at Dallas. And having read his quick take on the topic, I'm now pretty sure that claim is wrong.
The Canada paper has a major problem, which is that it isn't consistent. It suggests file-sharing increases CD sales ("We estimate that the effect of one additional P2P download per month is to increase music purchasing by 0.44 CDs per year") but it also admits it can find no such effect. The quote in Bobbie's post says:
We are unable to discover any direct relationship between P2P file-sharing and CD purchases in Canada... That is, we find no direct evidence to suggest that the net effect of P2P file-sharing on CD purchasing is either positive or negative for Canada as a whole.
This is ridiculous. If P2P file-sharing actually increases CD sales then CD sales should have gone up over the past few years. They have not. They have gone down.
Liebowitz points out that it's a mistake to draw conclusions only from file-sharers and puts in some simple numbers to show why. In layman's terms (ie mine, not Liebowitz's), heavy file-sharers buy more CDs because they are more interested in music. People who don't care as much about music (which is most people) do less file-sharing, and they also buy fewer CDs.
It's not cause and effect. As Liebowitz says: "the results are entirely determined by the simultaneity of degree of music interest and music consumption, whether purchased or downloaded."
For a proper explanation and the correlations, go to Liebowitz's site and scroll down to the bold subheading: Focusing on just filesharers.
Finally, a tip of the hat to Bobbie. In his intro to his post, he says: "A Canadian government study by two London researchers suggests that filesharers may buy more CDs than the average Joe." That is exactly right. But they may also buy fewer CDs than they would if they couldn't download them for nothing.
