The BPI’s blatant misrepresentation of the actual impact of file sharing

Not my words: that’s a comment by respected industry analyst Mark Mulligan from Jupiter Research. He says:

They claim that file sharing has cost the UK music industry 1.1 billion pounds over the last 3 years. I’m sorry but that is piffle. The UK music industry in 2002 was worth just over 2 billion pounds. In 2005 it was worth 1.85 billion. That is a total cumulative decrease of 0.29 billion. Where’s the extra 0.81 billion?

The BPI should

a) know better than to infer that consumer survey data is actual national market revenue data (however much it might help their PR push)

b) accept the fact that there are many bigger reasons impact declining music sales (prices too high, physical piracy (a MUCH bigger factor according to sister organization IFPI), competing expenditure (DVDs, games consoles etc.)

I couldn’t agree more. As Mark points out, the BPI’s figures mean that each and every file sharer has suddenly stopped spending £186 on music – which is far, far more than the average spend (most people buy around six CDs per year) and doesn’t take into account other forms of spending. For example, sales of ringtones are expected to hit £142.6 million in the UK this year; in 2005, sales of computer games in the UK hit £1.35 billion, making it the best year ever.

Sure, some people are file sharing instead of buying music. But I suspect that the number of people buying games instead of CDs is much higher.

Update

You’ve got to love No Rock’N’Roll Fun, which covers the same story: BPI Responsible For The Deaths of 3,759 People In The UK. As Simon writes:

No, they’re not, actually, but since they’ve decided to announce that illegal downloading has cost the UK music industry a billion pounds, we thought we’d pluck an eyecatching figure out the air and use it as a headline, too.

4 thoughts on “The BPI’s blatant misrepresentation of the actual impact of file sharing

  1. tm says:

    Are they *still* getting away with that ‘every illegally copy would have been an actual purpose’ nonsense?

    If someone illegally downloads 50 CDs then it simply doens’t follow that if there were no illegal copies they would have purchased all 50 of those CDs. That’s why you end up with the crazy figrues. This gambit is particuarly popular with the computer games industry because their products have such a high unit cost in comparison to, for example, CDs. Apply the same logic there and you’ll find that if there was no piracy the average console owner would be speding about two grand a year on games or soemthing equally ridiculous.

  2. tm says:

    wow, just read that comment again. It works a whole lot better if you imagine I can spell.

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