Oberholzer-Gee, Strumpf Now Say File-Sharing DOES Affect Music Sales – We All Make Music

Oberholzer-Gee, Strumpf Now Say File-Sharing DOES Affect Music Sales

In 2004, Felix Oberholzer-Gee and Koleman Strumpf, of Harvard Business School and the UNC Chapel Hill, respectively, published a study contending that file-sharing had no impact on record sales.

This week, they published another one, and unlike its predecessor, it is not completely wrong.

Billboard reports that Oberholzer-Gee and Strumpf (who’s since “moved on” to the University of Kansas) have “changed their tune” regarding file-sharing and record sales. Their new study finds that roughly 20% of the recent decline in sales is due to file-sharing, nearly the same conclusion reached by a 2007 Capgemeni study commissioned by UK music industry folks.

Both of these studies point to the unbundling of albums on iTunes and other pay sites as the main cause of eroding music profits, and it is nice to see these scholars finally recognize that p2p file-sharing does have an adverse affect on industry profits.

Even though Oberholzer-Gee and Strumpf’s 2004 work was thorough and carefully thought out, its findings led to an avalanche of crackpot theories about the real reasons for the music industry’s decline (Tom Koltai’s contention that “crappy music” is to blame, for example).

File-sharing isn’t single-handedly killing recorded music profits. But it’s making an impact and most definitely changing the whole economic structure of music, and the faster people will get over the idea that there is academic proof that they’re entitled to take whatever they want, whenever they want it, the better off everybody will be.