It appears that I have published chapters one and three but omitted chapter 2. My apologies, please accept this correction...
One shared file does not equal one sale lost. It really doesn’t. People will accept something for free that they won’t be prepared to pay for, don’t kid yourself otherwise. A shared file is equally likely to lead to more sales rather than fewer.
Whenever you hear or see stats being bandied around by the content industry, this is the principle on which they base their calculations; that each unlawfully shared file* represents one lost sale.
This is the biggie for the music industry but it’s increasingly being misunderstood by the movie business as well so let’s look at various reasons why this might be the case.
Firstly you have your hard-core never-pay-a-penny file-sharers. These are the ones who think that the labels have been sticking it to them so long that they somehow owe someone something so try to stick it back by never buying anything that they can get for free. These are your lost sales. But arguably, since they wouldn’t buy your product anyway (so they claim), which sale has been lost?
Anyway, assuming that the die-hards above are all bluff and would really be out there buying records if that pesky internet would just go away, why else would one shared file not equal one lost sale?
Here’s a few reasons:
- I’ve heard the single but I like this band and I’m going to buy the album when it comes out anyway, why would I pay twice for the single?
- I already own the song on an earlier format, I could go through the hassle of rigging up my record deck and copying it across but that’s illegal too and more hassle than just downloading a copy.
- I would happily buy a copy of this but because it's an old song / movie you no longer sell it. How can I buy something you're not selling?
- I’m not sure if I like it. I’ve heard it on the radio but I need a couple more listens to determine if I want to buy it. Try before buy marketing
- It’s not worth the cash. Now that cash might only 79p**, but when you’re talking about something with a unit cost of zero, that’s still a value judgement. I have a copy of William Shatner’s Rocket Man on cassette, I think it’s a pretty funny listen, but I’d never pay money for it, it’s just not worth it. Similarly I have old mix-tapes from the radio with various chart tunes on, if they turn up as a free download or magazine-cover cd then I’ll take a copy, but it’s not worth paying to replace them.
- Because it’s not being offered in the format that the consumer wants. Some bands / labels are rejecting the MP3 format altogether and only releasing things on hard copy. An increasing number of people are ditching hard copies altogether and moving everything to a digital file. If you’re not selling what I want to buy it’s not a lost sale.
And that’s not even considering the fact that some of the Industry numbers are counting shared playlists on social media sites (like Spotify) as shared files.
But in summary yes, some of those shared files are lost sales, but it’s not even close to all of them. Using statistics based on this premise undermines the argument and the public’s trust in the content industry.
* Including Format Shifting.
** On a separate note, can anyone justify the increase in cost of downloads when the technology and storage costs are only coming down?