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Music Media

Napster Hurts Album Sales? 393

Sax Maniac writes "There is a story on Yahoo! that reports on a new study that says Napster cuts into record sales. " It'd be a more informative study if the study also included the fact that a huge number of college students buy their music online now, which would also drive down sales in the local area - looks like a piece of FUD in MP3 War.

Update: 05/25 12:08 by michael : I can't help but jump in with a link: Pirates Steal Negative $1,400,000,000 from Music Industry.

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Napster Hurts Album Sales?

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  • Judging from my own CD buying habits over the years I wonder how this alleged trend compares to normal cyclic trends in the entire music industry. Country music has been waning for the last six years, heavy metal is all but extinct, etc. the industry in general seems to be in search of the new "trendy thing". Its also important to note that viewership in MTV and other music channels has gone down. My guess is that in the competition for Advertising dollars the stations had to provide content that would attact viewers/listeners. Non-music content and repeating the top 20 to death. This is also detrimental to sales. Not to mention the music industry's illegal price fixing on CDs. Maybe sales will increase now that CD companies can't force online retailers and Wal-Mart to charge $13-$18 per CD.
  • Also, any even remotely 'controversial' bands or not-big-sellers were given the boot over the last 10 years due to Merger-Mania. Anytime 2 big labels or Studios merge, the bottom 50% of the artists, sales-wise, are immediately dropped to cut costs. They can't guarantee big sales, so fuck 'em.
    It's the same problem with Hollywood: after merger-mania, the big Studios are constantly spending dollars to make pennies, hoping bigger-budget flicks turn into blockbusters, instead of producing more smaller-budget flicks and spreading the profits over a greater area.

    Then again, I find fault in almost all so-called 'common practices' within the business world. That's just me.

    Pope

    Freedom is Slavery! Ignorance is Strength! Monopolies offer Choice!
  • by small_dick ( 127697 ) on Thursday May 25, 2000 @05:59AM (#1048268)
    I submitted this story to slashdot, but they rejected it. Not all musicians are against napster; take a look at the following and the links at the end.

    Courtney Love, of the band "Hole", railed against the RIAA and record industry at a New York conference on Digital Music Tuesday.

    And I quote:

    "It's become quite fashionable lately for artists to express outrage at music piracy, and I'm a fashionable gal. Stealing artists' music without paying for it is absolutely piracy -- and I'm talking about major labels, not Napster," she remarked, citing major record labels as the single greatest threat to artist subsistence.

    She is desperately trying to break off from Geffen to go "DIY".

    Here are the links:

    news page on the hole site [holemusic.com]

    and the rolling stone article [rollingstone.com]

  • by FreeUser ( 11483 ) on Thursday May 25, 2000 @05:59AM (#1048270)
    Apalogies in advance for some of the rhetoric, but I am so tired of RIAA apalogist posts, and your post is the lucky winner...

    You're also screwing the bands whose cds you are not paying for. How nice to show your support.

    First, let me say that I do not make illegal copies of music - I own all of the mp3s I possess either through authorized downloads (e.g. mp3.com), or in CD, tape, or vinyl format. It is entirely possible that the post to which you reply was posted by someone similar (many more people than the anti-mp3 propoganda would suggest do in fact only have legitimate mp3s).

    And yes, I have used napster to download songs I own on vinyl or tape, but don't wish to go through the hassle of digitizing into mp3 format myself. If the new, draconian copyright laws (Sony Bono Act, DMCA) make this an illegal act, I suppose I'll borrow a friend's turntable and convert the music myself.

    I can guarantee you, however, that I am actively screwing the RIAA affiliated bands, as I am no longer listening to their music on the radio or buying any new CD's from them. I am not, however, pirating their music either. I have simply removed them, and all their new material, from my life altogether. Though I am only one person, this is costing them significant revinues (I used to buy allot of CDs - a bad habit exceeded only by my laserdisk and DVD habit, also now broken).

    Finally, though the legality is certainly in question, I would find it socially and ethicaly preferable if the original poster would send a few dollars to the band directly for the CD whos contents he or she downloaded in mp3 format, than to purchase the CD legally and put money on the pockets of a cartel which pays artists pennies and seeks to crush or forcibly coopt any new distribution paradigm that comes along and threatens their illegal monopoly.

    The only difference between the Mafia and its relationship to the Chicago city government in the 1930s and the RIAA (and MPAA) and Washington is that bribery has in the interim been formally legalized in the form of soft-money and campaign contributions.

    Don't expect to see any significant difference in the quality of government, the fairness of legislation being passed, or the appropriateness of law enforcement actions taken. The government has whored itself to the media cartels, and stands over the rest of us with a big, thick broomhandle in hand.

    I suppose in parting I should thank the RIAA and MPAA for going through so much trouble and expense to drive me away as a customer. My boycott of their products has already saved me thousands of dollars this year alone, which was very nice of them, as I can now afford to feed my aviation habit instead.
  • I'd like to see the orginal source to this study.

    There are potentially a number of other factors to consider when asking why college student CD purchases have declined. Perhaps the article should be more appoproately named "Why are college student record store CD purchases declining?"

    Beign a recently graduated university student, I was subject to tuition increases of 7%/year -- at least twice the rate of inflation. Thus, each year, I had less and less money for luxury items such as CDs. Perhaps on a larger scale this has been denting CD purchases.

    Another important point is where college students are buying their CDs? Why tromp over to the CD store when you can order it online and have it delivered to you. Does SoundScan count those statistics? Demographically, the college bunch would be the group most likely to take their music-purchasing trasnactions online. This too would show up as fewer record store CD sales.

    Of course, there are more points such as music is becoming worse and worse (so why buy it?), perhaps the students are preferring a different class of music altogether like one might find on the trendy MP3.com-type sites.

    I think studies such as this are probably at least indirectly motivated by the RIAA to provide negative press for Napster. Well, their negative press won't work on me. what might work would be some positive press for the RIAA. But the best RIAA news I got lately was the FTC stopping their stranglehold on CD prices!

  • Nobody who has access to broadband internet access buys CD's anymore.I>

    I do.
  • Salon details a record-setting week in CD sales [salon.com], highlighting Britney Spears' debut at #1 and breaking Mariah Carey's record of most first-week sales by a female artist by almost DOUBLE. These incredible sales figures are expected to remain high this week with the release of Eminem's [slimshadyworld.com] The Marshall Mathers LP. ("It may be the biggest rap record we've ever sold," says one CD chain operator.)

    But I suppose that college kids don't really like Britney or Eminem, and you can't find anything from either of those artists on Napster. (giggle. snort. guffaw.)
    --

  • *sigh*
    You've missed the point. I'm not saying that less college students buying CDs will bankrupt the record industry nor am I saying that college students wouldn't bootleg music if not for Napster. I'm saying that the RIAA getting into a tizzy because a few more college students are not buying CDs is stupid because these same students will eventually make money and are potentil lifelong fans. After all, the Grateful Dead let all sorts (including college students) bootleg their work and in return they had constantly sold out concerts and masive merchandising. Groups like Metallica may live to regret their actions...

  • by um... Lucas ( 13147 ) on Thursday May 25, 2000 @06:02AM (#1048277) Journal
    I don't think that anyone is reasonably trying to argue that MP3's in and of themselves are bad... For personal use, they're wonderous. I've got several days worth of music (all from my own CD's, thank you very much) stored on my hard drive at work. MP3's as a promotional tool is also a great thing. I know several artists who release *some* of their songs as MP3's to spur interest in their eventual CD.

    If an artist decides that they want to release their music in the MP3 format, they would most likely choose to put it on their own website in order to gauge interest, spur communication with their fans, and receive any revenues (from ads, links to purchase their CD's, T-shirts, etc...) associated with the distributiuon of their music.

    Napster does nothing to steer listeners towards buying the actual CD, is unable to produce any data to show interest or number of downloads, and (worst of all, IMHO) is, or will be soon, profitting from it's activities. In essense, they'll be earning money distributng music that the artists themselves will have no way of ever profiting from. The pickings from the labels might be slim, but Napster is effectively zeroing them out.

    It's one thing (not that I'm condoning it) to email an MP3 to your friend orrun an anonymous ftp server with mp3's on it. It's another thing to attempt to earn a profit by making that music EASILY available to anyone for the asking, but not return any of those profits to the artists. Napster really should figure out a way log transfers and cut artists checks for 50-75% of their (Napsters) projected take (once they've figured a way to make money... ads, anyone?)

    End of rant, for now.
  • by Pope ( 17780 )
    Thank goodness I d/l all my music from USENET, where there is apparently no correlation to lost sales. Man, my conscious is clear now!
    Anyway, I bought 4 CDs last week because I heard a couple tracks I d/l, so there goes that theory.
    Then again, I have always bought lots of records on a regular basis, even during University, so don't give me that "poor college student" crapola!

    Pope

    Freedom is Slavery! Ignorance is Strength! Monopolies offer Choice!
  • Listening to you people drone on about how Napster does not affect cd sales is sickening!

    I said it before, I meant it, and I'll now say it again: Napster does not affect CD Sales, nor will it destroy the music industry. This is the same piracy FUD they spread with the advent of casette tapes, and VHS, and both ended up being a benefit for their respective industries rather than the bane they attempted to paint them as.

    One need only look at the fact that CD sales have skyrocketed over the last few years. The article itself says CD sales are up 20%. Are you aware of how significant a chunk of change that 20% constitutes? Hell, if we want to be as statistically and scientifically shoddy as the people who conducted the study, we can correlate those two facts and discern that Napster is responsible for a 20% rise in CD sales...

    Anthony

  • Managers from other independent stores around the country said their businesses have been affected far more by the growth of big chain stores or by online retailers, such as CDNow and Amazon.com, than by online music-swapping software.


    Looks like they're noting that one cannot attribute the entire drop to Napster, or any of its kin.
  • Actually, college tuition costs have increased all over the US. I know I for one have had to really pull in the reigns of my spending over the years to deal with this, and buying fewer CDs is just one simple solution.

    I mean, cut back on the CDs or cut back on food..... hmmmm....

    ~Chris
  • One would think that the 12-16 year-olds that are the target market for this band would be wired and using napster... savvy enough to get the title on MP3. How does this fit into the equation?

    The 12-16-year-olds that are the target market for this band use AOL, for the same reason they listen to 'NSync. (Everybody else does it, so it must be cool.) Over AOL, to download the entire 'NSync album would take untold hours, and the kids know that they can get it much more easily by begging their parents to drive them to the mall.

    Most of the kids who are downloading lots of music are on fast and/or reliable connections, so they can rest assured that the songs they want will be downloaded promptly. Nevertheless, a quick search on Napster or Gnutella still reveals a LOT of 'NSync and Britney Spears songs being traded.
  • Okay: you don't understand what I'm saying at all. You suspect that the decline in album sales is due to Napster. You have your common-sense reasoning about why that might be true. You have what people who think about things for a living call "a hypothesis."

    You have not proven it. It has not been proven. There is, at this point, no proof.

    So, at this point, saying "See? Napster hurts album sales!" is a lie. If you want it not to be a lie, you must prove it.
  • by mwalker ( 66677 ) on Thursday May 25, 2000 @05:11AM (#1048298) Homepage
    Here's a link to coverage of the study [reciprocal.com] at reciprocal.com, the company that funded it.
    Here's a link to the the actual study in pdf form [reciprocal.com] by a consulting firm called "Entertainment Marketing Solutions"
    And here, finally, is the Mission Statement for reciprocal.com:

    Reciprocal provides comprehensive business-to-business secure e-commerce
    services for digital content distribution over the Internet. Our services
    include Digital Rights Management (DRM) applications and clearinghouse
    solutions that enable e-commerce for all forms of digital content including
    audio, text, graphics, software, images and video via the Internet or other
    networks.

    We protect your intellectual property on the Internet and make it easy for
    you to securely and flexibly package, sell, and distribute digital content.
    And we provide consumers with the ability to easily access, pay for, and
    consume your protected digital content.


    Hey, Slashdot Readers... how do YOU spell "Conflict of Interest" ?

  • Huh???

    What the study shows is that in areas where Napster is a major source of music procurement sales of albums have gone down.


    Huh again???

    The study found that sales droppen *most* near campuses where Napster has been banned. I doubt that the music industry people did an analysis of download frequencies before they issued their injunctions. Probably just looked for administrations that could be easily shoved around.

    If you want to claim that Napster "caused" the sales to decline, you have to explain how sales declined most where it isn't being used.

    Yeah, I know people dumb enough to risk getting kicked out of school for downloading a Metallica album. Not many, tho. Even fewer who also know how to bypass a firewall.

    "Copyright pirates vs. copyright thugs."
  • As for me? Yes I have started to buy MORE cd's because of napster. but then, I have stopped buying mainstream crap. I've been buying non-label artists' CD.

    This, in my experience, is a genuine trend, and is likely one of the unspoken reasons the RIAA folks have their knickers in a twist. Even if piracy ultimately promotes sales, it screws up the big label's marketing machines since it lets people expose themselves to a wider variety of music. Think about it: the fewer titles a label needs to produce and market to sell a given volume of CDs, the lower its costs for studio, production setup, unsold units, and so on. But if people buy a greater variety of music (because they are exposed to that variety on-line, legally or illegally), their costs go up, and thus their profits go down.

    This is, I think, a major reason why the recording industry appears so clueless in dealing with the on-line world. The natural progression would be in the direction of greater choice--and they don't want you to have any more choices than they want you to. Of course, the major labels' practices also mean that most artists wind up on the sidelines, except for their chosen few. They want their audiences to fall in large, well-defined (and well-controlled) groups.

    -Ed
  • True, "proof" in a social sciences context is different from "proof" in a mathematical context- you can't prove that Napster hurts album sales in the same way you can prove that a^2 + b^2 = c^2 on a right triangle. As you say, one must draw inferences that are much more sweeping. However, that does not mean that all forms of inference are equally valid. For example, "I believe statement X because of a long list of facts and observed phenomena that directly pertain to statement A (not statement B which is an awful lot like statement A)" is generally considered "proof" by social scientists, in that in the absence of somebody else explaining your data a different way (say, with statement C) or showing that some of your facts weren't actually true, we can consider statement A to be true. "I believe statement D because it seems on the face of it to be true" is not held in the same regard. Social scientists (and rational people, hopefully) will not consider statement D to be true, because there is no good reason to believe it.

    To bring that back to the discussion of Napster, the study gives me good reason to believe that album sales are going down around universities and that this is counter to the trend of album sales going up. It makes me suspect that maybe online piracy is to blame, but it doesn't give me any facts that speak directly to that, demonstrating that online piracy is to blame rather than, say, students buying music online or being poorer or having less access to music stores than before or just not listening to music as much for whatever reason. So it gives me the first kind of inference for statement one, but only the second kind of inference for statement two. As such, we the study give us reason to believe that statement one is true, but doesn't give us reason to believe that statement two is true.
  • Sales may have been even higher without all those people out there stealing music on Napster.
    Well they could just as easily have been lower. I don't know for sure. You don't know for sure. Nobody on /. knows for sure. Yet somehow the RIAA is so very sure, they're willing to start lawsuits about it. How do they know that, I wonder?

    Dyolf Knip

  • One has to wonder how up-to-date the data used in the study was. Napster has only (really) become a big enough thing to show up on their radar or make any kind of an impact in the last 6 months or so.

    Soundscan (who provide data to Billboard) have almost instant access to this information from the point of sales terminals at the major outlets (and probably some of the minor as well.) This is how Billboard can do it's weekly Top 40 list. There's enough other vagueries in their study to invalidate their claims anyway.

    numb
  • Yeah, but the ratio of screwage is thus: (measured on the ISO 9600 Screwage Scale, but I converted to American $$)

    1. Screwing the Band: 50 cents per CD
    2. Screwing the Record Company's Bloated Distribution Channel: $8.50 per CD.

      I'd say that the band is lucky that he's going so easy on them. Coulda been the other way around.

  • by barleyguy ( 64202 ) on Thursday May 25, 2000 @06:47AM (#1048318)
    What he is talking about is the cost to mass produce CDs.

    You can 10000 CDs for much less than 10000 dollars. In larger quantities, they are even cheaper.

    So the price in large quantities really is less than $1. Even when you divide up the cost of production, you are still probably in the $2-$3 range on an album that sells well.
  • ... that in the ratings, which tracked music sellers near college campuses, the decline of music sales near campuses that did not ban napster was 4%. The decline of music sales near campuses that did ban napster was 7%!

    What does this say? Napster helped preserve 3% of those lost record sales!!!!

    So, the napster straw man is officially dead. The true cause of the decline among (financially challenged) college students is plain to see: price gouging by record companies ..

    My take on Metallica, Dre, etc.: They have every right to pursue the individual copyright infringers. However, the fans are being gouged on pricing, and these artists are legitimately losing fan support because they are not standing up for the fans regarding CD prices. They seem to fail to see that, and are not seen as fighting the labels pricing structure (as Tom Petty did) for the sake of their fans. The suits are not wrong on legal or even moral grounds IMHO. I just think they're missing the point, and doing so with great acrimony.

    A band that is silent on this issue (as well as the issue of label exploitation of artists, internal bloated middlemanism, etc) is part of the problem, and this problem's been around for decades, it's only now with napster that this issue is cast in sharp relief.

    Your Working Boy,
  • There are so many holes in this study, it's hard to choose just one to attack. First, they talk about universities that are known to use Napster heavily through 'anecdotal evidence'; do they have any information on that? Does the amount of Napster usage (quantitive or even semi-quantitative) reflect the 'drop' in sales? Do universities with more Napster usage have a lower sales amount? Do universities with higher tuition have higher amounts? This report doesn't even pretend to cover any of this.

    Next, the studies uses three years of past data, along with data from the population in general as a control - this is not entirely valid. For a true internal control, they would have had to compare the college growth rate with the general growth rate in the past (for more than three years). Maybe the numbers that we are seeing reflect an already existing trend - the report sure doesn't talk about this. The numbers there look convincing but what are the standard deviations of the measurements - are these differences even meaningful?

    One of the last problems is mentioned in the article - on-lines sales. The report shows no information about this point-of-sale, which is almost certainly taking a bit out of the brick-and-mortar market.

    I hope that they do present this report for 'evidence' of bad-napsterism - any monkey with more than three minutes of stats or experimental design would tear it apart into confetti.

  • Is it such a radical idea to think that kids who can easily get music for free aren't buying less CDs?

    Kids are not know for their money-managements skills.

    A simple word problem: Breanna has a $30 allowance for the month. Sally has a $30 allowance for the month. Each of them buy 2 Brittany Spears albums at the mall, but Sally also uses Napster to download albums from Ricky Martin, N'Sync, and Brandy (none of which she likes enough to buy, but she thinks it is fun to have a lot of music to choose from). The next month, they both blow their allowance on CD's at the mall again (Christina Aguilera and Jewel), and Sally downloads a few more albums that she sort-of likes. How much money has the record company lost because of Sally's piracy?

  • By sheer coincidence, I just read a story in Salon [salon.com] about new records being set in the record industry. Apparently just this last week Britney Spears set a record for the most records sold by a female artist in the first week of an album's release. Eminem's new album comes out this week, and that is expected to open with 1.2-1.4 million first-week sales. That would be the first time ever that two records had consecutive million+ opening weeks.

  • And the artists? And the artists formerly known as children? And the children who claim that their parents are actually famous artists and not the boring people who people think they are? And poor kid rock!! [theonion.com]

  • It's amuzing that they are blaming the decrease on mp3 trading, when one considers that a majority of their sales over the last few years have been bankrolled by the 14-year-old-female demographic (n'sync, britney spears,et.al) or stuff that is otherwise targeted towards immature audiences (korn,manson). Perhaps if they realeased more music that appealed to a slightly more mature/inteligent audience they wouldn't be having their sales drop by this massive ammount.
  • In the Cnet Article about this
    http://news.cnet.com/news/0-1005-200-1945948.html? tag=st.ne.ron.lthd.ni

    It states
    As reported earlier, SoundScan division VNU Marketing tested the theory by looking specifically at
    sales in stores near universities, where online music has been more widely adopted than in the general
    public. In those stores, SoundScan data shows that record sales have actually dropped 4 percent in their internal networks, sales have dropped 7 percent in two years.

    Doesn't that indicate that Napster helps sales, since in the locations near Universities that didn't ban
    Napster, the sales didn't go down as much as at the stores near Universities where Napster had been banned.

  • ...the thousands of FTP servers running on Windows and commercial UNIX machines. Guess FTP's bad too. The RIAA really should do something about that.

    I actually downloaded more MP3s before Napster was around than after. I find Napster to be woefully inadequate for obtaining whole CDs, hard-to-find tracks, pre-released material, and anything that hasn't seen the light of the Top 40, basically. Since my musical tastes run anywhere from the sublime to the ridiculous with little to no "popular" (read: crap) music thrown into the mix, my MP3 searching ventures have taken me elsewhere of late (oth.net, IRC, mainly...)

    I think I had 30 MP3 CDs before I started using Napster, and I have about 35 now.

    (Oh, and for everyone that's gonna bitch about what an "asshole" I am for not buying music, I've spent a few hundred dollars this year on records. So, for lack of anything blunter, blow it out your ass, especially if you're posting as AC. It's pretty hard to DJ with MP3s.)

    - A.P.
    --


    "One World, one Web, one Program" - Microsoft promotional ad

  • Gnutella, et al, notwithstanding, this isn't worth getting worked up over. Napster's recent VC rather convicingly points to their becoming a music delivery service. Napster users are already registering and logging in to access (listen, ultimately) to music, so all that's left is to charge people to connect to Napster servers. Once they completely firewall fans from the major labels [yahoo.com] they'll be able to control access to the major label content on a subscription basis.
    They only care about their stuff, not MP3's in general. Heck, pirating MP3's of independent labels reinforces the Majors' position since they're in a better position to absorb any ill financial effects from loss of sales until they figure out a distribution model. Then all they have to do is raise the price of admission by non-Big5 labels to institute the same distribution model that is used for brick and mortar retail.
  • by plunge ( 27239 ) on Thursday May 25, 2000 @08:06AM (#1048348)
    What most people forget to factor in is that these companies include a lot of other costs into an "artist." Namely, they spend millions of dollars to make their talent famous in the first place- those promotional costs far outweigh the cost of CD production. The way the recording industry sees it- they built these artists into global and unique phenomenons, and they should be definately be able to profit from this temporary monopoly. (or else why risk it? Plenty of artists they bank often fail to break even with the promotional costs they spend on them)
    This certainly doesn't absolve music companies of price inflation, but it's a much more realistic picture than simply looking at the cost of making Cds.
  • <i>I can name 1000 different record labels off of the top of my head</i>

    Go for it, dude! Show 'em you know your stuff!

    I don't know about Napster, but when I was in college most of the mp3 trading was of top 40 crap, not the sort of thing an independant label would produce. Besides, if those responsible for 99% of CD sales collude in pricing, it is a monopoly. It makes no difference how many independant labels there are, because music is not a commodity, where one artist can be substituted by any another.
  • One possible explanation of this odd statistic could be that since these college students no longer have access to Napster to preview RIAA-produced music, they are buying less of it. Without Napster, the major labels have fallen off their radar.

    Most college students I know seem to be listening to bands from on-line distributors like mp3.com, instead of wasting their money on overpriced RIAA albums that are loaded with filler anyway.

  • That is an interesting question. Is it legal to download an MP3 of an album you've purchases on another medium.

    If you buy the CD, then you can rip your own MP3, I think everybody thinks this is legal. However, can you legally download an MP3 and skip the trouble of making it yourself, assuming the site you downloaded from had specific knowledge you purchased the CD? Then, suppose you scratch your CD such that it no longer plays. Are you now entitled to download the MP3? Or are you forced to buy a new CD? Then, to the ultimate question. Are you allowed to legally upgrade to a better format, from an album purchased on an older format? Or must you re-purchse?

  • What is the difference between the (RIAA and MPAA) monopolistic practices and those of (Microsoft and AOL/TimeWarner)?

    If we set aside the specifics of the Microsoft case - namely the leveraging of the OS/App empire against Netscape, the case is about the use of unfair monopoly power to excert unfair pressures on the market place.

    If we set aside the vacuuous notion of Intellectual Property, and factor in the FACT that copying of music PROMOTES sales in the long run (witness cassette tape consequences), then the RIAA is trying to use of unfair monopoly power to excert unfair pressures on the market place.

    Add to the pot the idea of regionalization and licensing USAGE rights for DVD's rather than the ownership of the content - as is key in the DeCSS vs MPAA conflict, and you have the same issue again. The use of unfair monopoly power to excert unfair pressures on the market place.

    Consider AOL's latest tactic of excluding other ISP's as a 'side-effect' of installing the latest AOL software. Couple with this the FACT that AOL is now in virutal control of not only means of distribution of their service (Cable networks) but also of the message that is delivered to the general public by a significant segment of broadcast media. Again you have the use of unfair monopoly power to excert unfair pressures on the market place.

    What gives?

    M$ is getting drawn and quartered (not that I'm against this or anything), the MPAA and RIAA are getting laws passed in their favor. The AOL/TW thing is still to shake out - but they did have their hand slapped by the FCC over excluding Disney from their data stream.
  • What I suspect - and I have my own purchasing habits to support this belief, as well as those of others I know - is that people don't buy fewer CD's because of Napster, nor do they buy more, but rather they buy different ones.

    Like vitually everyone I know, I have a certain fuzzy budget for CD's. I buy about 3 or 4 a week. I've got a CD library of almost 2 thousand CDs, of all genres, tending to the outre. Because of mp3s, my CD collecting habits can now be much riskier. I don't need to buy CDs of commonly available bands, of top hits or such. I can buy obscurities, rarities, and things that Just Might Be Cool. Artists that aren't even available on Napster yet because they're too new or obscure or unusual.

    This shift in buying freedom scares the RIAA and the corporate-pop musicians (like Metallica) as much as anything. Consumers can be less predictable when their budgets are freed to follow whims. The net effect is to flatten the pyramid: fewer sales, quite possibly, of Top 40 pap^H^H^H music, more sales of alternative and unusual musics.

  • by bridgette ( 35800 ) on Thursday May 25, 2000 @08:08AM (#1048356)
    I see at least 2 conflicts of intrest: 1) percieved image of studies as objective vs. real interest of PR pseudo-science 2) percieved image of news sources as providers of quality information vs. real interest of printing press releases verbatim so they can all get back to playing minesweeper.

    There is no pervasive, official, enforced licencing, certification or standards for scientists, researchers or staticians (unlike dr's and lawers), but people tend to believe that "studies" and "research" are supposed to find the "truth" using sound scientific and statistical methods. So there is a conflict between the percieved intent (truth) and the the interest (PR). For the definiton of conflict of interest, the actual intent of the actor is irrelevent (although in this case I'm sure they are quite pleased with the image of objectivity).

    But what really burns me up is that this "marketing research" is being reported in the news! Why is this press release (of thousands each day) news worthy? The only fact it contains is that sales have dropped 4% near colleges. Was it the increase in overall record sales noteworthy? What about the sales of shoes? Or red herrings? The only thing that makes this story interesting is the totally speculative napster angle.

    Headlines like "Is Napster taking a toll on CD sales?" gives attention to a random speculation to the benefit of a few private corporate interests. There is absolutely no evidence presented that the drop in sales has anything to do with napster, yet the question is posed as if it is currently a debateable issue*.

    A more appropriate headline might be "Are College Students Buying Fewer Records?" since the "study" doesn't even prove that students are actually buying fewer records. Indepenednt stores selling small and super-tiny labels, on-line stores, bands selling direct at shows and used CD's weren't accounted for.

    Even if they had gotten that far, there are so many likely suspects that singleing out napter is biased, at best. Poorer students (reduced student loan money, increase in drug prices, increase in concert ticket prices, less free booze) crappy major label offerings, poularity of underground [rap, metal, techno] and bootlegs (phish, gdead), are some of many reasons there might be decrease in college student record purchases.

    It's this kind of crappy reporting that turns non-issues into something suddenly deemed worthy of congressional investigation. FUD is too good a term for it.

    * this is exactly like when they talk about the "global warming debate" as if the scientific community is still trying to decide if global woarming exists! the only atmosheric scientists still questioning global warming are the ones that happen to work for petroleum companies
  • You've missed the point.

    I did it kinda deliberately because I had another one to make ;) Nothing personal.

    because these same students will eventually make money and are potentil lifelong fans.

    I couldn't agree with you more. The RIAA is really shooting itself in the foot here, they've forgotten the age-old rule that there is no such thing as bad press (here come the replies...).

    "Rampant Music Piracy Bankrupts US Economy" is the spectre they're trying to raise here, and if you look at what they're trying to say in such simple terms, it becomes obvious how ridiculous these studies are...

    Anthony
  • I estimate that since the 'tallica and RIAA lawsuits, my personal boycott of CD purchases amounts to 30 sales.

    Mostly, I just listen to my older CDs, borrow from the library, borrow from friends/relatives, or listen to the radio.

    When I see a way to pipe cash back to my favorite musicians, without supporting the RIAA, NetPD, 'tallica and others (who I beleive made illegal intrusions into millions of people's privacy) then I'll start spending on my favorite bands.

    The RIAA and music companies are screwing the public and the musicians -- stop buying CDs til they stop the theft of our privacy.
  • "As reported earlier, SoundScan division VNU Marketing tested the theory by looking pecifically at sales in stores near universities,where online music has been more widely adopted than in the general public. In those stores, SoundScan data shows that record sales have actually dropped 4 percent in the past two years. In stores near the 67 colleges that have banned Napster, citing an overload on their internal networks, sales have dropped 7 percent in two years. " It seems to me that this article should be titled, "Online Music hurts Local CD Sales" By online music I mean Napster, CDNow etc. I am also confused by the above, Sales have dropped 4% at stores near univerisites but at stores near univeristies that have banned Napster they have dropped 7%. Does banning Napster make actually things worse or am I just reading this wrong? Does Napster deter people doing things like burning CDs which could have a greater (albeit still samll) effect on CD sales?
  • You need to be beaten with a cluestick if you think Napster is the only significant way of pirating MP3's. I knew people who stopped buying CD's in 1997, and there used to be all sorts of web sites with MP3 wares, and they have always been transferred over chat rooms and the like. Not to mention CD copying (which became a mass-mainstream activity around that time also)

    The most compelling statistic in the article was the fact that in the highest bandwidth areas, sales were down over double what they were down in the lowest bandwidth areas. This sounds like a smoking gun to me. You can't use the on-line sales argument because it doesn't take significant bandwidth to access CDNOW and the like.
  • Whatever the interpretations of the sales figures, the study is likely to show up in court and in Congress, as judges and lawmakers puzzle over how to treat software like Napster in the future.

    If you control the stimulus you control the response.

    "The findings come as no surprise and confirm our worst fears," said Amy Weiss, a spokeswoman for the Recording Industry Association of America (RIAA), which is suing Napster. "This demonstrates the importance of protecting artists' rights on the Internet."

    How about protecting artist's rights in the real world? [google.com] (cached for your protection ;)

    This article is horrible, mainly because if you just glance at it (like our politicians will do) it would seem to support the RIAA, when in fact, it says nothing at all.

    --
  • I think the study is a lot worse. The Napster people can't back up what they said either, but they didn't say it in the context of a scientific study. Everybody knows that if I just make a statement ("Napster rescues babies from fires!") it isn't to be taken seriously unless I can back it up, even if sometimes people believe things a little more quickly than they ought. This study, on the other hand, misleads people into thinking that what they're claiming has, in fact, been backed up, when it actually hasn't. Much worse, I think, though propagating the argument that Napster helps CD sales is also irresponsible if you don't have anything to back you up.
  • According to current law, sorry - you have to repurchase in ALL those cases. Isn't it nice how legislation works when industries get to write their own regulations? :(
  • I remember once way back in my college days (1984) reading in the LP liner notes of some Athens, GA band that said something like "Please don't copy this record...if you like it, support the band and buy it". I ignored that plea and made a cassette copy because I wasn't about to go spend the $8.99 for a record that I wasn't sure I liked. But I liked the music enough to want to listen to it some more, if only in a crappy, hissy format like Compact Cassette. Was I ripping the band off? I didn't think so because they weren't getting my money anyway, so there was no lost sale. Did I have a right to that access? No...since I didn't own the platter, copying it wasn't my right.

    But you know what? Having that cassette turned me into a fan I subsequently purchased the following LP and even went back and bought the one I'd taped previously. So that band (Love Tractor in case you're curious) benefitted from my "illegal taping", despite their plea that I refrain.

    Is this anecdote illustrative of anything? Personally, I think so. Music is a great promotional tool. The motivation should be on expanding distribution, not restricting it. If I were a recording industry executive, I'd be looking at shooting ahead of the rabbit rather than trying to create obstacles. I'd be embracing the technology as the viral marketing tool than it is. In the short term, I wouldn't be worried about eroding profits, taking solace in the fact that people with -56K connections aren't too enamored with spending 15-30 minutes downloading a track...assuming they know how to access it in the first place. I'd be a fool to characterize college campuses as dens of rampant MP3 trading rather than viewing them as fertile ground for cultivating future fan bases. Even so, there's a much larger population out there that is still uninitiated or unaffected by the lure of "free music online". In the meantime, I'd start building a strategy to embrace and exploit this coming wave. I'd strive to make my retail product better than the freely exchanged product; adding multimedia content, including extended liner notes, enclose coupons or promotional giveaways...the creative possibilities are numerous. Make the retail product something worth spending money on. Use the free MP3 (or whatever digital format you like) to promote the product. It's like a huge listening station where you are trying to hook listeners into wanting more and better. If the music is disposable, then it won't stand up to this model, but then that's a good example of natural selection isn't it? Might cut down on the ephemeral successes of future Milli Vanillis and Spice Girls. If the music is in demand, then you have more sales and more profit.

    Oh yeah, and I wouldn't gouge my customers with unsupportable product pricing and then blame things like My.MP3.Com and Napster for flat sales.

    For a change of pace, scrounge through the heaps of amateurs at MP3.Com [mp3.com] and see what gems you can find. Building fans. Here's a small "station" of World Beat music I've created -- Outside the Box [mp3s.com]. Make your own; share with friends. MPPP may be in the tank but I think they're doing a lot of things right.

  • by SteveM ( 11242 ) on Thursday May 25, 2000 @10:39AM (#1048374)

    Ms Love said"Stealing our copyright provisions in the dead of night when no one is looking is piracy."

    Under an amendment to copyright law passed last year all sound recordings are now classified as "works for hire". Thus, the recordings become the property of record companies forever. Prior to this, artists could reclaim the copyright after thirty-five years.

    For the RIAA it is all about control. Artists and consumers be dammed.

    This amendment was passed without hearings or testimony. As you might imagine, artists are pissed. USA Today had a blurb on it in the May 25th edition noting that Sheryl Crowe was testifying before Congress today.

    Looks like the RIAA was really looking out for artists rights this time.

    Steve M

  • ...it has been discovered, after many intensive studies, that the new "Casette Tape" technology has had a negative impact upon Vinyl record sales. Industry representatives are blaming the ability to record albums onto blank casettes and distribute them illegally for the drop in sales.

    New technology wipes out the old. This is Darwinism at its best: the record companies are being told "Evolve or die!"
  • What you are looking at here is the difference between correlation and causation.

    It's like the cave man who beat his hammer on a rock the same time that lightning struck. Just because he beat his hammer, and lightning struck, doesn't mean that beating the hammer causes lightning.

    Correlation does not imply causation. If you choose the causation in advance, and then check for correlation, you can "prove" almost anything.

    The study did nothing to investigate the factors involved. You can't just assume that they are one thing or another, because if you are going to assume, there is no reason to do a study in the first place.
  • Just because the development costs apply only to the first copy doesn't me that they don't exist. Saying that it only costs $1 implies that record companies could sell CDs for $1 and still make a profit. That's pure and utter crap and I'd be amazed if even the person making the claim believes it.

    If you want to talk about record company profit margins, that's fine. I'll probably agree that they're outragous. But implying that those profit margins are 90%, which is what a claim that it "only costs them $1" is doing, is pure FUD, and nothing else.

  • by wass ( 72082 ) on Thursday May 25, 2000 @07:05AM (#1048380)
    I agree that this is a logical fallacy. There's two basic data points here. Namely, the increase of Napster's online trading, and the decrease of record sales. It's been awhile since I've done statistics, but, IIRC, to show a correlation with 95% confidence between two events, you need something on the order of 30 trials! This is only 1 friggin' trial.

    You may claim that there's multiple data points, spacially separated (ie, different colleges), but they're temporarily the same. (ie, it's the same Napster, in the same market conditions, etc), so you cannot conclude anything useful from this study (IMHO, of course).

    Otherwise, they can point to any event in the news, and show a correlation just the same. For example, they could claim that since the MSFT trial started over a year ago, CD sales have been declining. Thus, they conclude, the chaos caused by the trial of the world's largest software house is significantly cutting into CD sales.

    Come on! Note that I'm not saying Napster doesn't reduce CD sales, but that there isn't enough data available to implicitly show it (through this study, that is).

    Just my twopence.

  • when in fact, it says nothing at all.

    Like most politicians. :-)

  • From a purely techinal stand point, not getting into the legal or moral debates here, but just the techinally details.

    A lot of colleges (and ISP, and companies) bandwidth is being quickly chewed up by Napaster, why the hell doesn't the colleges just start an in house mp3 server? It would save a lot going though internal 100mb ethernet instead of a extrenal T1. If I could go to college, I would slap in a couple 30 gig IDE hard drives and post it to the local college mail list.

    God college sounds like so much fun.
  • A study released by record industry retail tracker SoundScan shows declining CD sales at stores near universities, and some are pointing fingers at the Recording Industry Association of America.

    As reported earlier, SoundScan division VNU Marketing tested the theory by looking specifically at sales in stores near universities. In those stores, SoundScan data shows that record sales have actually dropped 4 percent in the past two years. According to the RIAA [widescreenreview.com], full-length CD dollar value grew 12.3 percent last year alone. "It looks like the RIAA clearly has an impact on sales in the U.S.," said Joe Blow, CEO of a now rich digital rights management firm.

    Jack Kirk, who manages independent CD store Dr. Wax near Northwestern University, says the labels are reaping the rewards of their own pricing policies. Cash-strapped students have turned to online music swapping because the record companies have priced the CDs of many popular artists out of students' reach, he said.

    "It costs major labels less than $1 to make a Pearl Jam album, but the list prices are nearly $20," Kirk said. "They've precipitated this themselves--it's ridiculous. The major label companies are (run by) extremely evil people; I'm sorry, but there's no other way to say it."

    The RIAA had no comment.

  • by SvnLyrBrto ( 62138 ) on Thursday May 25, 2000 @06:18AM (#1048393)
    What you (so convinently for RIAA/metallica schills) fail to mention is that colleges have been caveing in left to right to the RIAA's pressure to ban napster.

    Or have you so convinently (for RIAA/metallica schills) forgotten that fact?

    Or have you so convinently (for RIAA/metallica schills) missed the stories on slashdot the last few months about colleges caveing in to RIAA pressure to ban napster?

    Or have you so convinently (for RIAA/metallica schills) forgotten that college students are among the highest target market for *USEDU CD sales?

    A while back someone had posted a link to a list of colleges and universities that are supplicating themselves before the RIAA and banning napster on campus.

    It'd be intresting to see if the study bothered to take into account the fact that the administration of these schools DID cave in to pressure and see if sales of CDs are HIGHER near colleges where MP3s are banned.

    Or could it *POSSIBLY* be that college students are traditionally the most socially consious and actively progressive element of soceity; more apt to *PROTEST* injustice, and more apt to *BOYCOTT* RIAA albums and MPAA movies?

    john
  • (Everybody really knows that most money is made on tour!)

    Everybody knows that the earth is flat, that marijuana cures cancer, and that there is an all-knowing, all-powerful god who cares about your sex life.

    Sure, maybe there are artists who make most of their money on tour, but most musicians tour to get people to buy the album. You've heard the phrase "go on tour to support the album"? Have you ever heard "sell the album to support the tour"?

    The idea that touring is where the money is, is wrong. It's a moral justification for downloading music, but it just doesn't hold water. Personally, I don't pretend that artists don't make any money off album sales; I justify stealing by "I wouldn't have bought it anyway".

    But, I went to Linux a few weeks ago, and don't have sound set up yet. So I'm certainly glad I have my CDs to listen to.

    --Kevin
  • The record industry has recently by fingered by the Feds for colluding to set artificially high prices for CDs. It is a feature of monopoly pricing that it decreases sales volumes but increases overall profit. We can see the increased profits in the financial results the companies report.

    So why do sales decline most next to universities? Because sales to buyers with the highest price elasticity of demand will suffer the most, and with fixed budgets, college students certainly are among the most elastic consumers.

    The story could easily have been titled ("spun") as: study indicates cartel pricing behavior by record industry.

  • Basic supply and demand. It costs that much because people are willing to pay that much.

    However, if you look through the record store, I think you'll find that older albums are typically cheaper. For example, the latest Metallica album costs $17.99, while "Ride the Lightening" only casts $13.49 at cdnow.

    Neither of those prices is anywhere than $1, but then, in very few products, not CDs, not books, not Cheerios, does the cost of product make up the major part of the total cost.

    Somebody has to pay to get it to the store. Pay the rent on the store. Pay the rent on the warehouse. Pay the taxes. Pay the salaries. Etc, etc.
  • Yes, if you ignore all the other costs that go into getting a CD to the customer.

    There are a lot of costs associated with selling something that have nothing to do with the production. A lot. The majority, in fact.
  • I'd say that MP3s are the most benificial to the consumer. There are WAY too many albums full of complete crap that have 1 good song. The record companies used to be able to employ clever marketing, releasing only the good songs to radio. when have you heard the crappy songs from albums being played on the radio. A consumer gets a whole album, and it's crap, so he doesn't buy it. I, myself, only buy chrisitian music, and because of copyright laws where I live, it's perfectly legal to download mp3s. The thing is that the mp3s I have downloaded with napster are songs I'd never buy because I could do without them. I have a few singles, the good stuff that I know, but I don't like buying albums, it's a large waste of money. If, and only if, the artists brought out a CD with plenty of good music, it would be worth these rediculous prices. MP3s hold truth, and that's what scares them.

  • That story is really misleading - and an attempt, accurate or not, to focus on technologies such as Napster for the loss of sales. It reeks of being a 'study' set up for Exhibit A in a lawsuit. Other major technology factors such as BUYING A CD ONLINE were apparently ignored. Additionally, how does this fit in with the huge increase in sales/profit that the RIAA has reported for the past 2 years?

    I tend to buy most of my CD's online these days, unless I am hunting through used cd stores. Its easier, faster, and less stressful. That, and the selection is infinitely better.
  • That not-yet-released album has been floating on Nap. for several weeks now. I wonder what effect the 0dayMP3 release will have on the album sales.
    The official release is june 13 (http://www.thehip.com/ [thehip.com]). Could we perhaps have a slashPoll like:
    A) I've downloaded Music@work MP3s
    B) I've downloaded Music@work MP3s and will buy the album
    C) I've downloaded Music@work MP3s and bought the album
    D) I bought the album, don't have the MP3s
    E) Tragically WHO?
    ---
  • by Anonymous Coward

    Imagine that I can download an entire album. Why would I buy it?

    "But the CD sounds so much better" you say. "Surely if you like the songs, you'll buy the album".

    Then the question should arise: Does Napster increase sales?

    By the reasoning of most mp3 apologists, it should. It should also increase sales of concert tickets and t-shirts, which we are told (by those who are completely uninformed in the business) are the main sources of revenue for artists.

    But does it? There is no evidence that Napster increases record sales. Prove it, and maybe I'll change my mind.

    Now think of this. You're a kid, maybe 15 or so. You make a little bit of money every now and then. Maybe your parents even give you a few bucks as an allowance.

    Do you:

    A) Buy a $18 CD?
    B) Download it for free?

    And if you download it, would you go out and buy it afterwords? Sounds pretty unreasonable to me.

    For all their whining about "helping artists", the mp3 crowd has a lot to answer for itself. And until they do, they're just spewing empty, greedy rhetoric.
  • I'm not arguing that napster and mp3 doesn't impact record sales... (and if it did, mp3 itself would impact far more than just napster... people share in many ways, especially when connected over high-speed)

    The stats interpretation is screwed up.

    They say 'record sales are down 4% over 2 years near this university' and 'this university has people using napster' and 'these other universities, that had real napster problems, have had 7% drops in the area near the university for record sales'.

    Both of these facts simply show that two phenomenon are tied together geographically. Although it may seem logical that napster is the cause of the drop in record sales, it really isn't.

    Perhaps students have better things to spend their money on now? Perhaps the record stores are not carrying the proper music anymore? Perhaps students just order shit online more?

    At any rate.. if people aren't shopping at your store anymore, perhaps you don't have a product that interests them. If music can be had for free, because it costs *nothing* to distribute... then why do you think you can be in business?
  • Problem with your methodology: it is just as likely to prove that using Napster hurts CD sales as it is to prove that studying political science hurts CD sales, or that computer science hurts CD sales, or anything else you can correlate with being a college student hurts CD sales. Off the top of my head, I would certainly do surveys at colleges to determine where college students were getting their music and compare that with survey data from non-college-students, with an eye towards file ripping and online music shopping. First I'd need to establish that college students are actually buying fewer CD's, which may or may not be true. Then I'd have to establish that people who aren't buying the CD's are getting the music through other sources (piracy). A possible study that comes to mind would be taking universities that have Napster and comparing them to those that don't in terms of music purchasing rates, controlling for neighborhood type and student body characteristics. That's just off the top of my head, though- there may be holes in that, and there could be a better way to do it anyway.

    The point is, it really isn't adequate to do what the people who conducted this study did. It honest-to-goodness does not and cannot establish rigorously what they want to establish. If it turns out that there isn't a good way to determine what they want to determine, that doesn't suddenly make bad ways to determine things valid science.
  • Since Napster came along, I haven't sold a single copy of my album.

    Oh, wait... I don't have an album...

  • The report doesn't actually indicate anything beyond the raw stats - it's kind of pointless.

    Currently I find it hard to beleive Napster eats into profit mainly because its just a search engine, it's not a media format or a playback device. It's just not all that interesting a tool.

    When and if mp3 or its replacement reaches a better sound quality, and can be used portably and easily (Rio sucks) then it's a threat.

    MPAA or whoever needs to pay more attention to someone like Sony releasing high quality digital hi-fi hardware and standard tools and protocols for moving digital music between the hi-fi, the personal player and the car. That will change the industry FAR more than a bunch of college kids wasting their college's bandwidth on tunes.
  • To a degree this is all true. However, explain to me why a Beatles CD of an album from 1965 still runs $15 new? Whoever owns "The Beatles" has gotten a huge return from originally promoting the Beatles (I somehow think the Beatles never needed promoting to begin with).

    We're still getting gouged, in my opinion.

    After an album hits Platinum (how many units is that anyway?), they should ease off on the price a bit as I'm sure they've made a good profit by then. Just like the movie houses that run 3-month old "current" releases for $1 a seat.


  • Or even better yet, just read the postings on /. as truth... :)

    That has caused more troubles in this society then Napaster, Volient Video games, and guns combined. :)

  • These bands made a conscious choice to sign a contract with a record company, and should have been aware of the pricing policies before they did so.

    So, after years of washing dishes for a living, when the record company shows up to offer the next Sarah McLachlan her recording deal, before she can decide, she has to go look up their pricing policies in 67 different countries?

    OK, so let's fast forward, their pricing policies seem sound, so she accepts the deal. Two weeks later the company adds a Minidisc division, but prices them three times as much as CDs in Venezuela and Sri Lanka. Should she be a conscientious objector and quit, supposing her contract is even written in such a way that she can do so?
  • ... that in the ratings, which tracked music sellers near college campuses, the decline of music sales near campuses that did not ban napster was 4%. The decline of music sales near campuses that did ban napster was 7%!

    What does this say? Napster helped preserve 3% of those lost record sales!!!!

    Or the other interpretation would be that the campuses with bandwidth problems bad enough to necessitate banning can be tied to revenue loss. You have to remember that the study is based on 2 years of revenue, while Napster (ab)use is a fairly recent phenomenon. It could just mean that these campuses are more likely to pirate, i.e. from word of mouth or "because they did it."

    There's an interpretation for everything when you do these studies, especially when you neglect variables. That's why we have the "scientific method" requiring us to try to be impartial.

  • by doom ( 14564 ) <doom@kzsu.stanford.edu> on Thursday May 25, 2000 @08:37AM (#1048447) Homepage Journal
    Everyone really should read the "study" itself. Once again: the study in pdf form, by Entertainment and Marketing Solutions [reciprocal.com]

    It's very sketchy (it's only two pages!). They don't give you enough information to duplicate their work, even if you *did* have access to SoundScan data (which none of us do). Some points:

    1. They present data for three regions: the total US national sales, the sales for areas within five miles of a college, and the sales for areas near "selected colleges" that "anecdotal evidence suggests a high degree of Napster usage". They don't even tell us which colleges are in this "selected" group. In other words, they were free to select any colleges that showed a downturn, and toss them into the "selected" group on the basis of "anecdotes" which they've chosen not to repeat.
    2. They work only with first quarter sales, comparing them to other years. This is fairly common in the retail business, but you can't just ignore the year long sales picture... (Note: it is at least possible that college students tend to give gifts of CDs, and that the year-long average contradicts the story told by Q1 data alone. Remember that Christmas sales are huge compared to Q1 sales... a lot of retail businesses make all of their money at the end of the year.)
    3. In general I wonder how significant a drop of a percent or two is. More data might give us a better feel for how much jitter there is in the data. If the noise is around, say, 5%, the figures they cite become much less impressive.
  • The RIAA can probably find any number of studies that support their arguments... while ignoring a similar or greater number of studies that refute them. The fact that their biggest clients -- the major labels -- have been found to be engaging in collusion to artificially boost CD prices and other recent news items about the increase in music sales/profits just goes to show how pointless this entire affair is. If they'd been shown to be actually losing money perhaps the lawsuit would make sense. The problem is that their profits didn't increase the way they always have in the past.

    Personally, I don't know who buys a lot of music through the major retail outlets that this group's study polls anyway. Most of my friends either buy via mail order from places like http://cuneiformrecords/ [cuneiformrecords], at small privately-owned stores (where the owner really knows the music), or I see bands live at small clubs and buy their CDs at the show. I buy at the large stores only when I see something in the bargain/cutout bin where the prices are closer to earth and even then, only when I'm running an errand at a nearby store or shopping for something else the big store carries. At a recent show, I paid only $12 for the band's latest CD which is far below what I would have paid at a major retailer (assuming that the CD would have even been available there) and is less than what CDs were selling for when they first came out in the early/mid-80s (Remember when they were going to be cheaper than LPs? Ha ha ha!). Plus I got to chat with band members while I was making the purchase. I've got to believe that's a better way support your favorite musicians than having them waiting for the miniscule royalty checks from the big recording companies. Maybe that's only true, though, for the bands that I'd go to see (who don't play the arenas anyway) -- Ricky Martin and Brittany Spears might not be able to survive very long playing small clubs.
    --

  • by Carnage4Life ( 106069 ) on Thursday May 25, 2000 @05:18AM (#1048451) Homepage Journal
    Napster hurts album sales especially among poor college students. This is not FUD this is fact. I'm in college and I know several dozen people who have massive MP3 collections who have cut down on the amount of CDs they buy, myself included. For every person I have heard say, I buy more CDs because I find more groups (how does this happen? Napster is a search service or do people type random names in the search box?) there are five people who say I probably will never have to buy a CD again.

    Personally, I like the argument put forth that even though college students pirate stuff now with MP3s that this will benefit record labels in the long run. The RIAA seems to forget that college students grow up and leave college to become adults with lots of disposable income. After all isn't it former bootlegging college students that pay an arm and a leg to see the Who, Rolling Stones and even Metallica in concert. The proliferation of music on college campuses will create life long fans who will eagerly start spending money on the artist once that disposable income comes around. After all that is the rational behind banks trying to attract college students with various student accounts even though it is a well known fact that college students a perenially broke. If the RIAA had any sense, they wouldn't be trying so desperately to alienate fans because this may come back and bite them on the ass.

  • by Squid ( 3420 ) on Thursday May 25, 2000 @11:43AM (#1048452) Homepage
    Something to consider: I've been a Sarah McLachlan fan since 1989, I've bought all her albums (3 copies of her first, 2 copies of her third, 2 copies of Freedom Sessions), most of her singles, numerous shirts, tour books, souvenirs, and attended so many concerts I lost count (more than ten). How much of that money do you think she's seen? About $1 per album, probably less for the singles, maybe a dollar per shirt... under $20 not counting the concerts, and I doubt she gets the whole $35 from each concert ticket.

    Which means in eleven years of being a fanboy, I've given her almost enough money that she could buy two of her own CDs at retail.

    Oh it gets better. When you buy a CD from Columbia House, the artists often get NO royalties at all - it's considered an advertising expense! (How come Metallica isn't suing THEM?)

    These companies pay their artists "starving wages" (and then MAYBE actually promote them so that they can at least make it up by getting $1 from each of a half million people). Then they say WE'RE the ripoff artists. I think that's just a little bit insulting.
  • by Gene77 ( 90233 ) on Thursday May 25, 2000 @08:39AM (#1048453) Homepage
    No, no, no- you're quite wrong. Just step through the logic:

    1) College areas have reduced sales
    2) Non-college areas have increased sales
    3) Napster detracts from sales
    4) Therefore, Napster detracts from sales.

    Oh wait, that's bad logic. Nevermind.
  • by Wakko Warner ( 324 ) on Thursday May 25, 2000 @05:18AM (#1048454) Homepage Journal
    The article mentions that album sales had been on a downturn since 1998 - *a full year before Napster's release*.

    With that in mind, any time a record exec tells me Napster kills record sales (which they haven't yet done), I will laugh heartily.

    - A.P.
    --


    "One World, one Web, one Program" - Microsoft promotional ad

  • by johnny_amp ( 170790 ) on Thursday May 25, 2000 @05:18AM (#1048459)
    ...a much better publication.

    go here [villagevoice.com]

    <//-------------//>
    "I like /. but you can tell it was designed by programmers..."


  • >Nobody who has access to broadband internet
    >access buys CD's anymore.

    Well lets see. I've got access to an OC3 at work, and a 512Kbps dsl at home. I dunno what UC has for bandwidth, but it's undoubtedly pretty high. Is that "broadband" enough for ya?

    I bought three CDs in the last week.

    Your tautology is disproven. Your auguement is invalid.

    Next?

    john
  • This is the paragraph that I like:

    Those numbers compare with an overall sales growth of about 20 percent across the music retailing industry.

    The retail music industry is growing by 20% and they're bitching about a 4% decline in small towns where people buy music online. These corporations are making more money then they ever have in the past and suing small companies because they "should" be making more. They sound like spoiled children.

    -B
  • Are you really so gullible as to believe any statements from rock stars to be literally true ?

    Maybe she does "support" Napster in a rather agnostic manner (it's Geffen's money its stealing, not hers, so she doesn't care) by not taking Metallica's "sue-everyone" line, but that's hardly doing anything to support it in a pro-active manner. Love has a big mouth, and you shouldn't believe everything that comes out of it.

    PS. Sorry to hear about the size issue.

  • There is a great book that covers the basics of logic and fallacies and such. It's called Logic and Mr. Limbaugh and uses the writings of the "Big Fat Idiot" as examples of logical fallacies. Excellent, and extremely amusing, reading.

    btw, I have spotted quite a few other possible causes mentioned in other posts for the declining sales:

    • College kids are poor; rising costs are making them poorer
    • College kids are buying more CD's online now
    • College kids, being more likely to be liberal, are boycotting the RIAA
    • The study covered Q1, a time at which college kids are recovering from buying all those CD's as xmas gifts
    • There is less music worth buying coming from RIAA artists

    I'm sure there are other possible reasons for the statistics that I missed. Note that like the Napster idea (Students aren't buying music, they're pirating it), these are all just possible reasons. Kinda like the reason Cindy Crawford doesn't return my phone calls could be that she thinks she's not good enough for me.

  • I'm not stealing, it's either piracy or it's civil disobedience. I claim civil disobedience, you can claim piracy, but you can't claim theft.

    //rdj
  • definately not me though. Stuff that I mentioned is all verifiable. You can think I'm a bastard.. that's fine, I am not the nicest person around. But lying was not involved.

    //rdj
  • by Uruk ( 4907 ) on Thursday May 25, 2000 @05:20AM (#1048494)
    I know that there's a lot of people who download things off the net and through napster, and then go out and buy the album. Lots of people actually like the liner notes, and a lot of times the mp3 may not come with a proper ID3 tag to identify artist, album name, track number, track name, year, genre, etc. So people support the artist by buying the CD even though they've already got the whole album on mp3 through napster. (And let's be more general - this isn't really about napster per se, but the easy availability of the media in the first place - IMHO there isn't much difference between napster and any other file sharing protocol, just that napster is what's in the news recently)

    But there are a lot of other people who just download mp3s and never buy the album. I'm not going to make a value judgement and say that they are theives, or that they are are excellent freedom fighters trying to liberate ideas from evil recording companies. What I want is for people to take responsibility for what they do. There are a lot of people out there who just take from napster, and never buy albums. That's fine, I'm sure they have a moral justification one way or the other, but I don't like hearing people say that Napster is fine, because it boosts record sales, because most people buy records after downloading things. Conversely, I don't like to hear people say that napster hurts record sales, because that ignores all of the people who bought the album when they wouldn't have otherwise done so due to "sampling" the album through napster.

    Frankly, whatever you want to do with napster is cool with me. I don't use napster, but I don't think that people who do are going to starve the RIAA out anytime soon. What I wish though is that people would only speak for themselves and not make arguments for the napster community as a whole. Because guess what? There are people out there using napster who believe that the RIAA have the right to make the money, so they pay for the albums after the fact. There are also people who see themselves on napster as information gurillas. YOu can't have it both ways. Speak for yourself, and live with your rationalizations, whichever way they may be.

  • by Paul Neubauer ( 86753 ) on Thursday May 25, 2000 @05:20AM (#1048497)
    As Hemos said, many can and will buy online now.

    The reason is very simple. It's easy to check and compare prices and for items like well known CDs, buying 'unseen' is no big deal.

    Stores near universities can no longer count on mere proximity to generate sales. They now have to compete on value. What makes a music store stand out now? Not just having the common items that can be ordered from anywhere, but having less common items or knowing how to get them. A really outstanding store would have used CDs and even allow potential customers to listen to them before purchasing. I've only seen this once, but I made a point of going back to that place. As for service, they "got it." Less risk of buying something for one track only discover all the other tracks are lousy.

    As for Napster.. maybe it hurts some, maybe it helps some. It's probably irrelevent overall. College dorms are a places where CD and tapes are borrowed and dubbed already.
  • by Devil Ducky ( 48672 ) <slashdot@devilducky.org> on Thursday May 25, 2000 @05:20AM (#1048500) Homepage
    I didn't even know there were such things as "music stores." I always buy my CD's online.

    C|NETlink to the story [cnet.com]

    Favorite Quote: "Cash-strapped students have turned to online music swapping because the record companies have priced the CDs of many popular artists out of students' reach"
    Then whose fault is it?

    Devil Ducky
  • by RimRod ( 57834 ) on Thursday May 25, 2000 @05:22AM (#1048526)
    Hmmm...

    Truth --> Raw Data --> Study Findings--> Yahoo Article--> Slashdot.

    If there were ANY meaningful pieces of information somewhere along that chain, it's pretty certain they're lost by now...if there's one thing I learned writing psychology experiments, it's that the data can say whatever the hell you want it to, as long as you omit enough pieces of relevant information.

    Next.

  • by Outlyer ( 1767 ) on Thursday May 25, 2000 @05:24AM (#1048548) Homepage
    This is so typical. Misleading statistics by bargain-basement statisticians confusing causation with correlation. To assume that there is only ONE cause for declining sales is pure stupidity.
    To put it another way, CD sales were down this year, and coincedentally, the price of tea in China also declined. Clearly, the price of tea in China is having a negative effect on CD sales.
    This is clearly a stupid argument, but it's not far removed from the one made by these so-called researchers. There is a difference between a cause and a coincedence.
  • by GeekLife.com ( 84577 ) on Thursday May 25, 2000 @05:26AM (#1048559) Homepage
    For me, as I'm downloading from Napster, if I find I'm downloading a couple of different songs from the same Napster user, I'll add them to my hotlist and check out what other songs they have available.

    If it's mostly bands I know and like and some bands I haven't heard of, I'll download the unknown bands' songs.
    -----

  • by panda ( 10044 ) on Thursday May 25, 2000 @05:29AM (#1048570) Homepage Journal

    Hey, Slashdot Readers... how do YOU spell "Conflict of Interest" ?

    Conflict of interest? No. It's pretty obvious why reciprocal.com commissioned this study. No one takes these things seriously, anyway. Corporations commission "studies" all the time and paint the results in such a light as to drum up business. It's called "marketing research" when its done to target customers, and spin when done like this.

  • by Ex-NT-User ( 1951 ) on Thursday May 25, 2000 @05:31AM (#1048583) Homepage

    I found the things store managers mentioned quite interesting. Why is it that a CD Store Owners/Managers don't blame Napster? Instead they're saing it's the high CD prices that are driving down sales on campuses. I'm sorry but forking out $20 for a CD is way too much.

    On top of that the study is flawed big time.

    1. Didn't acount for online CD sales?
    ( I've personally not bought a single CD in a retail store. I buy everything on line especially since I can sample most of the music )

    2. They didn't compare in sales statistics for CD swap/resale shops which usually have very low prices on used CD's.
    ( From what I got from the article those stores have not seen any changes )

    3. The biggest drop was BEFORE Napster came about. ( Hmm.. ok so why was there a big drop? )

    The RIAA is simply looking for anything they can use as artilery to kill Napster. I've been using Napster for the last 2 weeks. I've downloaded over a 100 MP3 files... and most of them I don;t have anymore cause I didn't like em. I've also bought 6 CD in the last 2 weeks of music that people on Napster recommended to me and I got a chance to listen to it before buying. Without that I propably wouldn't have bought them.

    You want to know why the RIAA is scared of Napster? Because consumers have more power. I can listen to ALL of the tracks on a cd to figure out if it's worth buying. Not just the 1 hit on a $15 CD that the RIAA thinks will sell the CD to 90% of the target audience. It means they have less control over their consumers. It means they can't manipulate us as they have in the past.

    They're a dinosaur that deserves to die a quick death. And trust me it won't hurt the Musicians 1 bit as newer, smarter, better companies that "get it" take their place.

    Ex-Nt-User
  • by radja ( 58949 ) on Thursday May 25, 2000 @05:32AM (#1048597) Homepage
    >Napster hurts album sales especially among poor college students. This is not FUD this is fact.

    In the dutch situation there is another thing:
    When CDs were introduced, they were ridiculously overpriced.
    Vinyl: Fl 25.00
    CD: Fl 40.00
    Record companies loudly proclaimed CDs would soon be the price of vinyl. But this never happened. Now very recently the price of SOME CDs has gone down to Fl 35.00. Add to that the fact that grey import (=import of legal CDs from other sources) is not allowed any more, and we can see that this is a monopoly. The record companies will not lower their price. In my eyes they're a bunbch of lying bastards, and I'll screw them any wya I can.

    //rdj
  • Coincident with the arrival of MP3 and Napster, these sales take a pretty severe dip downwards.

    The majority of people are so easily mislead by statements like this because they lack a simple understanding of the basic rules of logic. In this case, for example, correlation is not causation. There is a direct, frighteningly statistically accurate, correlation between the number of priests in a given town, and the number of alcoholics. Both are functions of population...

    I suggest consulting this page [niu.edu] for a brief summary of common logical fallacies.

    This study is so vague it's almost silly. While they determine that CD stores with physical proximity to universities have slightly declining CD sales, they make no attempt whatsoever to determine the actual cause of said decline, and simply *decide* that it is the result of .mp3 and the RIAA's boogeyman, Napster. One has to wonder who commissioned the study...

    FUD. This is the real-world equivalent of trolling :) Shoddy science passed off as fact to an ignorant audience (for the most part).

    Anthony
  • by jacobm ( 68967 ) on Thursday May 25, 2000 @05:36AM (#1048606) Homepage
    A lot of people have been yelling about Hemos's comment that the study is FUD. That was my reaction too- "Not everything that goes against a particular belief system is FUD," I thought to myself, and got all ready to post a long diatribe about it.

    Then I read the article in question. Here's what it says (my paraphrase): "CD sales around colleges have gone down, while CD sales elsewhere have gone up. Therefore, Napster hurts album sales."

    The conclusion that Napster is to blame for the drop is completely unfounded. It was just made up. Even worse, it was tied to something that wasn't made up (ie the sales drop) in such a way that it seems on the face of it like a valid conclusion to make ("They did a study, and they found that Napster hurts album sales, see?"). That is FUD. It is a particularly bad kind of FUD. It would be sort of like Microsoft saying, "Windows 2000 didn't sell as well as expected among college students, and here's our study to prove it. Therefore, online piracy is having a demonstrable effect on our sales." It sounds almost like real science, but in fact it's a made-up lie to scare people and get your way.

    That does not mean that Napster doesn't hurt CD sales. It just means that the study didn't prove it. If they wanted to prove it, they would have to actually do a followup study that actually analyzed why those sales dropped. Which they didn't do, so they can't legitimately say anything about it.
  • by Ty ( 15982 ) on Thursday May 25, 2000 @05:38AM (#1048617)

    My experience on the college scene for the last two years has been that there is a lot of pirating. However, there is a large flaw in the RIAA's claim that this is causing them record sales.

    Yes, most students are flat broke. Take my girlfriend for example: She has about 300 MP3s on her computer but doesn't own more than 5 CDs. Well guess what? Whether or not she has access to MP3s, she still would NOT be buying more albums! Why? Because she's generally broke, as are most college students, including myself.

    My point is that it's fine for the RIAA to target college students for pirating--I just wish it would quit blowing smoke about profits it would never have had.

    -Tyler

  • by JPrice ( 181921 ) on Thursday May 25, 2000 @05:39AM (#1048620) Homepage

    And if you download it, would you go out and buy it afterwords? Sounds pretty unreasonable to me.

    Maybe I'm unreasonable, but yes, I do go and buy the album. I'd say I use MP3's in three ways:

    1) I download a catchy song that I like. This is about the only thing I use Napster for. If I want the latest single from a one-hit wonder, should I pay $17 for a CD otherwise full of crap? Should I pay $13 for the single which has less crap but only because there's fewer tracks? You'd probably say yes, but since I wouldn't have bought the album anyway, I can't see that me having that track hurts the artist. Sure it's not legal, but is it any more harmful than those mix tapes you've got?

    2) I download a lot of bootlegs from newsgroups. These aren't being sold anywhere, and if they are the RIAA/Artist isn't seeing any of the cash anyway. A lot of the bands that I download (Dave Matthews, for instance) actually support bootlegs as long as they're not being sold.

    3) I've downloaded some albums from newsgroups. I got the newest Cure album the day before it came out. I didn't like it, so I didn't buy it. I also didn't let it take up 100mb on my hard drive either (ie. it's gone). On the other hand I got the Crowded House Afterglow album, enjoyed it, and went out and bought it a few days later.

    Admittedly, I'm probably in the minority here, and I don't believe that MP3's are helping artists, but I really don't think they're hurting them as much as the RIAA would have us believe. In fact, my suspicion is that if you had two worlds, one without MP3s and one without record execs, the artists in the MP3 world would be much better off.

  • by Wakko Warner ( 324 ) on Thursday May 25, 2000 @06:25AM (#1048646) Homepage Journal
    I know a lot of people who copied tapes for friends in grade school. Sometimes I record stuff off the radio. Once -- *gasp!* -- someone even sang me a copywritten song! Should we factor this into the equation too?

    Or should we look at the real reason many think the RIAA's going after Napster: they're losing the control they once had over the eyeballs (well, ears, technically) of the consumer. Another slashdot reader said it a lot more eloquently than I did, but the record industry is in fits because they can't be absolutely certain that the income they get from a handful of "popular artists" -- whose popularity they *manufacture* -- can be ensured anymore.

    - A.P.
    --


    "One World, one Web, one Program" - Microsoft promotional ad

  • by Wah ( 30840 ) on Thursday May 25, 2000 @05:58AM (#1048652) Homepage Journal
    It's pretty obvious why reciprocal.com commissioned this study. No one takes these things seriously, anyway.

    Hmm, I'm not so sure. I can tell you where this study will resurface.

    Whatever the interpretations of the sales figures, the study is likely to show up in court and in Congress, as judges and lawmakers puzzle over how to treat software like Napster in the future. A congressional committee heard testimony yesterday from Napster foes and fans, looking specifically at the online music world's effect on small record labels and retailers.

    This is the kind of information the RIAA (and others) use to make their laws. The only way to combat it is to voice your own opinions and experiences.

    Like this guy.

    Jack Kirk, who manages independent CD store Dr. Wax near Northwestern University, says the labels are reaping the rewards of their own pricing policies. Cash-strapped students have turned to online music swapping because the record companies have priced the CDs of many popular artists out of students' reach, he said. "It costs major labels less than $1 to make a Pearl Jam album, but the list prices are nearly $20," Kirk said. "They've precipitated this themselves--it's ridiculous. The major label companies are (run by) extremely evil people; I'm sorry, but there's no other way to say it."

    Hehe, looks like I'm not the only one in need of tact lessons. ;-)


    --

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