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Don’t Blame Downloads for Sagging CD Sales

It’s become music-industry dogma that Internet file sharing is destroying the retail music business. But a statistical study unveiled on March 29 by the Harvard Business School finds no such connection. As numerous newspapers and websites are reporting this week,…
April 5, 2004

It’s become music-industry dogma that Internet file sharing is destroying the retail music business. But a statistical study unveiled on March 29 by the Harvard Business School finds no such connection. As numerous newspapers and websites are reporting this week, Harvard researcher Felix Oberholzer-Gee and colleague Koleman Strumpf at the University of North Carolina, Chapel Hill, tracked downloads of songs on 680 popular albums over a 17-week period in the fall of 2002, then compared this data to record-store sales of the same albums. They found a correlation that was “statistically indistinguishable from zero.”

That result is already provoking rejoinders from music companies, who have long used Internet piracy as an all-purpose scapegoat for falling music sales. But as John Schwartz points out in today’s New York Times, “Critics of the industry’s stance have long suggested that other factors might be contributing to the drop in sales, including a slow economy, fewer new releases and a consolidation of radio networks that has resulted in less variety on the airwaves.”

Download the HBS study here.

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