Music file sharing and sales displacement in the iTunes era

A growing empirical literature examines the relationship between music file sharing and legal purchases of music, but existing studies examine the period before consumers had attractive legal digital a la carte options. The iTunes Music Store has grown quickly since its appearance in 2003, and digital music now accounts for a third of US recorded music sales. Using a new survey of University of Pennsylvania undergraduates, we ask how music file sharing and sales displacement operate in the iTunes era, when the alternative to file sharing is purchasing individual songs, rather than entire albums. We find large amounts of file sharing in this population. Respondents have more stolen than paid music, but the music obtained via file sharing is, for the most part, low-valuation music which the respondents would likely not have purchased. The rate of sales displacement implied by the relationship between stolen and purchased music across respondents is between -0.15 and -0.3. That is, an ad...

• Type: Journal
• Year: 2010
• Where: IEPOL
• Authors: Joel Waldfogel
• Keywords: Applied Computing, IEPOL 2010, Music, Sales Displacement, Sharing