Relevance of Empirical Analysis of the File Sharing Vs. Music Piracy Controversy

Relevance of empirical analysis of the File Sharing vs. Music Piracy controversy

The music industry has been vehement in its condemnation of Internet file sharing programs like Kazaa, eDonkey, Limewire et al, citing the technology as a primary contributor to the drop in record sales . While file sharing does make piracy of copyrighted digital goods easier, the link between drop in record sales and increase in file sharing activity is tenuous at best (Zentner, 2004). Empirical investigations with a stronger rationale (Strumpf, Oberholzer-Gee, 2005) suggest that there is no direct causal link between the two. Boorstin (2004, p. 63) concurs and concludes that while file sharing increases record purchases in the 25 plus age group and decreases purchases among the 15 to 24 year old, the overall impact of Internet access on CD sales is positive. The lack of commonality in the measuring instruments used by all three studies and the obviously divergent conclusions that resulted, suggests that the scope of investigation should include a wider range of variables before a valid causal link can be established. But, in the final analysis, is such an exercise relevant?

Statistical analysis tends to yield the best results within a narrow range of measurable variables where 'all other factors are equal (or irrelevant)'. One may argue that measurement of only the relevant variables should provide a statistically significant answer that can then be used to establish the link, like in the exit polls. The question then is what are the relevant instruments that will establish this causality between file sharing and music piracy? Strumpf et al, circles around downloads 'during school holidays and technical features related to file sharing' (Abstract) , Boorstin looks for the relationship between Internet access and CD Sales in four age groups (Abstract) , while Zentner measures broadband usage and the sophistication of Internet users (Abstract). All of them advance a mathematical rationale for their instruments but none provides any proof to invalidate any other reasoning. This of course is the statistician's 'weasel hole' ... the picture that comes to mind is of the three blind men and the elephant !

Not surprisingly, all of them do acknowledge the limitations in their sampling model and, in all fairness, do a respectable job of arguing away the weaknesses. However, the contention here is not about the inefficacy of measuring tools but rather a broader observation of its irrelevance in relation to music piracy and online file sharing.

Copyright protection in some form has existed since the invention of the Gutenberg press. Laws are revised and updated as new inventions provide loopholes to circumvent the spirit if not the letter of the law. The debates around file sharing and music piracy are yet another cycle of the same conflict: producers vs. consumers. Historically, producers have had the purchasing power with lawmakers. The evidence for a 'commons' approach to intellectual property (IP) is still inconclusive. This ambiguity