from Globetechnology
Music industry study decries downloads
By JACK KAPICA

The battle over whether downloading free songs from the Internet is hurting the music industry continued Tuesday, with the release of another survey showing that the practice is discouraging music sales.

Almost 30 per cent of those who responded to a survey conducted by Toronto-based market-research company Pollara Inc. said downloading, file sharing and burning were the main reasons that their purchases had declined.

Conversely, Pollara reported that 52 per cent of music “consumers” who don’t download had purchased music in the past month.

Only 35 per cent of those who were active downloaders had purchased music in the month prior to the survey.

The survey was commissioned by the Canadian Recording Industry Association, which has been claiming for several years that trading music files on-line has been hurting sales.

The survey “negates arguments to the contrary that peer-to-peer activity is just sampling and those people go out and buy the music later from a legitimate source,” CRIA president Brian Robertson said in a statement.

CRIA blamed the hardware that makes compact disks — CD burners — and the file-sharing network Kazaa for lost sales. Mr. Robertson said that the use of CD burners to copy music has grown from 18 per cent in late 2001 to 35 per cent today.

Almost half of the survey respondents who download free music told Pollara that all of the music they burned to CD came from file sharing networks like Kazaa.

The Pollara study also says that the number of people who admitted using Kazaa in the previous month had more than tripled, from 8 per cent to 26 per cent, and that they typically download between 20 and 100 songs a month.

Taken at face value, Pollara states, this amounts to an average of 180-million tracks per month.

CRIA estimates its retail sales losses at more than $465-million since 1999, as well as industry layoffs of more than 25 per cent throughout the past year.

Mr. Robertson said this spells doom for the music industry.

“It is unlikely that the music industry can continue to develop new artists and promote established artists, if these activities persist,” he said. “Canada’s artists and producers must be protected in the digital environment and in order to do so, swift reform to chronically outdated copyright law is absolutely imperative.”

Two recent court cases have increased the rift between the music industry and music buyers.

In March, the Federal Court of Canada ruled that the downloading described in the survey is lawful for Canadians who download for personal, non-commercial purposes and burn music on to CDs. The court reasoned that Canadians are already paying for their music through a levy placed on blank CDs, a levy that the music industry demanded the government institute.

The copyright board of Canada, which administers the act, agreed with the court, and went further to say that it has already recognized the increased downloading and burning activity by expanding the scope of the levy.

The ruling was a blow to CRIA, which had been seeking to identify 29 people, who allowed their music files to be copied by other Internet users, to prosecute them under the Copyright Act.

Last week, the Supreme Court ruled that Internet service providers who supplied the network along which music files were transferred were not legally liable for how their subscribers used the Internet.

The suit had been brought by the Society of Canadian Composers, Authors and Music Publishers (SOCAN). Although SOCAN lost the case, CRIA lawyer Richard Pfohl issued a statement praising the decision because it “confirms that music rights holders in Canada need to be paid for music transmitted on the Internet from outside the country and calls for modernization of Canada’s antiquated Copyright Act.”

CRIA had intervened in the case on the issue of internationally transmitted music.

The current Pollara study surveyed 1,200 people 12 years of age and older by telephone between March 12 and April 5. The survey has a margin of error of 2.5 per cent, 95 out of 100 times.