Andersen and Frenz (2008)

From Copyright Evidence
Jump to: navigation, search

Advertising Architectural Publishing of books, periodicals and other publishing Programming and broadcasting Computer programming Computer consultancy Creative, arts and entertainment Cultural education

Film and motion pictures Sound recording and music publishing Photographic activities PR and communication Software publishing (including video games) Specialised design Television programmes Translation and interpretation

1. Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare 2. Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)? 3. Harmony of interest assumption between authors and publishers (creators and producers/investors) 4. Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption) 5. Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)

A. Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right) B. Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction) C. Mass digitisation/orphan works (non-use; extended collective licensing) D. Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability) E. Fair remuneration (levies; copyright contracts) F. Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)

Source Details

Andersen and Frenz (2008)
Title: The Impact of Music Downloads and P2P File-Sharing on the Purchase of Music in Canada
Author(s): Andersen, B., Frenz, M.
Year: 2008
Citation: Andersen, B., & Frenz, M. (2008). The impact of music downloads and P2P file-sharing on the purchase of music in Canada.
Link(s): Definitive , Open Access
Key Related Studies:
Discipline:
Linked by: Lunney, Jr. (2012), Oberholzer-Gee and Strumpf (2010)
About the Data
Data Description: The paper analyzes Canadian survey data and results are representative of the Canadian population aged 15 and older. The analysis is based on direct answers provided by 2,100 Canadian respondents. The sampling technique used was quota-based random sampling, stratified by age (participants were 15 years or older), gender, geographical region and downloading status.
Data Type: Secondary data
Secondary Data Sources:
Data Collection Methods:
Data Analysis Methods:
Industry(ies):
Country(ies):
Cross Country Study?: No
Comparative Study?: No
Literature review?: No
Government or policy study?: No
Time Period(s) of Collection:
  • 2005-2008
Funder(s):
  • None

Abstract

This paper addresses the emergence and growth of new types of markets, - the on-line markets for electronic delivered music -, which in turn influence organizational change and industry evolution in the music industry. (The direct challenge this raises for the copyright and the appropriability regime in the music industry is also central to the results.) The direct focus on the paper is consumption and consumer behaviour in music markets. This study measures the extent to which free music downloads and peer-to-peer file sharing networks, for which the sound recording industry receives no remuneration, affect music purchasing activity in Canada, including both electronic delivered music and CDs. The big debate is whether free music downloading and copying substitute existing music pay-markets or reinforce them. The analysis relies on representative micro-data of the Canadian population age 15 and over, obtained by asking Canadian individuals to what extent they are engaged in downloading and/or purchasing of music, and about their incentives behind such behaviours, focusing on the conventional mainstream demand-side factors related to (i) price of the good, (ii) price of related goods (whether substitutes or complements), (iii) consumer income, and (iv) consumer taste. This paper builds upon a major study conducted for Industry Canada between 2005-08, and was aimed at supporting policy decisions in relation to the internal review of the copyright regime in Canada.

Main Results of the Study

This paper addresses the emergence and growth of new types of markets – the on-line markets for electronic delivered music – which in turn influence organizational change and industry evolution in the music industry. The direct challenge this raises for the copyright and the appropriability regime in the music industry is also central to the results. The direct focus on the paper is consumption and consumer behaviour in music markets. This study measures the extent to which free music downloads and peer-to-peer file sharing networks, for which the sound recording industry receives no remuneration, affect music purchasing activity in Canada, including both electronic delivered music and CDs. The big debate is whether free music downloading and copying substitute existing music pay-markets or reinforce them. More specifically, this paper shows that:

  • Those engaging in free music downloads and file-sharing do not purchase more or less music compared with those who are not engaged in such activities, but that very active downloaders and file-sharers purchase more music compared with downloaders and file-sharers who download relatively few songs.
  • There is a positive and statistically significant relationship between the number of music tracks downloaded via P2P networks and the number of CDs purchased.
  • Both the P2P file-sharing group and the entire population show a positive and statistically significant association between ripping CDs and CD purchases.
  • Canadians who participate in P2P file-sharing because they find CD albums to be too expensive also purchase fewer CDs.
  • People who participate in P2P file-sharing because the music is ‘not available elsewhere’ also tend to purchase more CDs.
  • There is no direct evidence that CD price influences CD purchases.
  • Respondents who experienced a higher CD price purchased fewer electronically-delivered music tracks.
  • People who buy a high number of DVDs, videogames, cinema tickets and concert tickets also purchase a high number of CD albums.
  • Music purchasing in general takes up a too low share of peoples’ income to have any effect on purchasing behaviour.

The results suggest that music markets are not necessarily undermined by free music downloading and P2P filesharing (especially due to the strong market creation effect, such as ‘hear before buying’, and the fact that people engaging in free music downloading and filesharing are more likely to purchase electronically delivered music). However, technological innovation (spurring the way in which music is now electronically delivered and consumed) pushes a need for the music industry to change their organization of such appropriation, in order to match the emerging new structures.

Policy Implications as Stated By Author

This article, building upon a major study conducted for Industry Canada between 2005-08, was initially aimed at supporting policy decisions in relation to the internal review of the copyright regime in Canada. When analysing the effects of P2P file-sharing and free music downloading activities on pre-recorded music purchases in CD and electronically-delivered music markets, the focus was in particular on whether such free downloading and P2P filesharing displaces/substitutes or increases/stimulates music purchases. Based on our findings we argue that free music downloading and P2P filesharing behaviour may not be bad news for the industry, because such activities create a range of new business opportunities.

Coverage of Study

Coverage of Fundamental Issues
Issue Included within Study
Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare
Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)?
Harmony of interest assumption between authors and publishers (creators and producers/investors)
Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption)
Green-tick.png
Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)
Green-tick.png
Coverage of Evidence Based Policies
Issue Included within Study
Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right)
Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction)
Mass digitisation/orphan works (non-use; extended collective licensing)
Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability)
Green-tick.png
Fair remuneration (levies; copyright contracts)
Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)
Green-tick.png

Datasets

Sample size: 2,100
Level of aggregation: Individual
Period of material under study: 2005-2008