NPD Group: Music File Sharing Declined Significantly in 2012

[Pardus]

Article

RIAA will claim that downloading is down because they shutdown so many newssites, and P2P sites. Truth is people aren't downloading or buying music anymore with streaming services like Pandora/Last FM/Spotify etc.

Increased use of free music streaming services takes a bite out of illegal peer-to-peer music file sharing activity.

PORT WASHINGTON, NEW YORK, February 26, 2012 – According to The NPD Group, a global information company, illegal music file sharing declined significantly in 2012. Last year the number of consumers using peer-to-peer (P2P) services to download music declined 17 percent in 2012 compared to the previous year. When P2P file sharing peaked in 2005, one in five Internet users aged 13 and older (33 million people) used P2P services to download music; however, last year that number fell to 11 percent (21 million people).

The volume of illegally downloaded music files from P2P services also declined 26 percent, compared to the previous year; however P2P wasn’t the only sharing activity to shrink. Music files burned and ripped from CDs owned by friends and family fell 44 percent, the number of files swapped from hard drives dropped 25 percent, and the volume of music downloads from digital lockers decreased 28 percent.

According to NPD’s “Annual Music Study 2012,” 40 percent of consumers who had illegally downloaded music via P2P services in 2011 reported that they had stopped or downloaded less music from P2P networks. The primary reason for this reduced sharing activity was an increased use of free, legal music streaming services. In fact nearly half of those who stopped or curtailed file sharing cited the use of streaming services as their primary reason for stopping or reducing their file-sharing activity.

“For the music industry, which has been battling digital piracy for over a decade, last year was a year of progress,” said Russ Crupnick, senior vice president of industry analysis at NPD. “Among other factors, the increased use of legal and licensed streaming services has proven to be an alternative for music fans who formerly used P2P networks to obtain music.”

More than two years after Limewire was shut down, nearly 20 percent of P2P users who reduced or stopped their P2P activity cited the fact that that their preferred service was closed, or that the services they used created issues with spyware and viruses. “In recent years, we’ve seen less P2P activity, because the music industry has successfully used litigation to shut down Limewire and other services; many of those who continued to use P2P services reported poor experiences, due to rampant spyware and viruses on illegal P2P sites.”

Data note: Information in this press release was derived from NPD’s “Annual Music Study 2012,” based on data from NPD consumer surveys. Survey data was weighted to represent U.S. population of Internet users (age 13 and older).

 

[ImpulsE69]

What they don't really say is if music sales went up nearly that much. I'm guessing no. So another words, soon they'll be turning against the free music streamers.

 

[rivan]

What they don't really say is if music sales went up nearly that much. I'm guessing no. So another words, soon they'll be turning against the free music streamers.

The spice must flow.

 

[dighn]

these days i find if i want to listen to something i just go to youtube. no need to buy/download unless i really like it.

 

[Wyndru]

What they don't really say is if music sales went up nearly that much. I'm guessing no. So another words, soon they'll be turning against the free music streamers.

Yup.

I don't even know how these streaming services make money. I don't know anyone who pays for the streaming subscriptions, and even the ads on the free versions are really sparse. Without ad block enabled I only hear 1 commercial every 10 songs or so, and it's usually only a 15-20 second ad for geico or progressive.

I assume these services have to host the music on server farms, as well as pay royalties for the music, so it has to cost some serious $$ to keep it going.

 

[phucheneh]

I think there are a lot of things at play here. A couple already mentioned.

-You don't have to pirate non-mainstream music to 'demo' it anymore. Most rather unpublicized acts (and their labels) seem to not mind Youtube postings. Or have just given up on chasing them down. Almost any band I want to check out has got some songs uploaded.

-Internet radio has come a long way. Has the station variety of satelite radio, and in the case of stuff like Pandora, is customizable. Many free services. Then you have the pay services that, if I understand right, actually let you select your music (is this how Rhapsody is? God, that's a brand that's been looking for a service to provide for like a decade plus).

-Not only is iTunes still extremely popular, but microtransactions are becoming far more widespread. In some ways, this worries me, as I'm afraid physical media is going to slowly disappear in favor of 'buy this song for a dollar'...which I simply won't do. I buy albums. Plus, the issue of audio quality would probably just drive me to pirate more, in order to obtain FLAC copies.

 

[GagHalfrunt]

I blame the music industry for not producing more music that's worth downloading.

 

[ImpulsE69]

-Not only is iTunes still extremely popular, but microtransactions are becoming far more widespread. In some ways, this worries me, as I'm afraid physical media is going to slowly disappear in favor of 'buy this song for a dollar'...which I simply won't do. I buy albums. Plus, the issue of audio quality would probably just drive me to pirate more, in order to obtain FLAC copies.

You know though, there are many albums where people only like 1 or 2 songs. So this isn't horrible. Also, the music industry started with singles, not albums.

 

[Tommy2000GT]

Because new music is awful now. Everyone is listening to the old stuff.

 

[phucheneh]

Yup.

I don't even know how these streaming services make money. I don't know anyone who pays for their paid services, and even the ads on the free versions are really sparse. Without ad block enabled I only hear 1 commercial every 10 songs or so, and it's usually only a 15-20 second ad for geico or progressive.

Before Pandora, I used AOL Radio and a few others on occasion. They got pretty damned bad with the ads.

Then went to Pandora, which was great, with only semi-annoying ads. I liked it enough to pay the meager price of a year of service (seems like it was ten bucks or something at the time). Then when that was up, the ads really seemed to have gotten bad. I think maybe they reeled it back in a bit.

I mean, it's obvious how they make money- big advertisers (like Geico) pay good money to have their ads constantly hammered into your brain. My question is...who deemed this to be effective?

E.g. on some TV networks, you will see the same ad during every commercial break, which might add up to 6-10 times in an hour. Do they REALLY think that they'd get less benefit from 3-5 ads? I know for me, like many, I'm sure: ads have little to no influence over what I spend my money on. In my case ('cause I'm an asshole), they generally nothing but remind me of which companies I have an intense hatred for (often simply because their commercials annoy me).

Basically, we get to have free stuff because it's ad-supported, but we'd have more money to spend if products didn't cost so much because of insane advertising budgets.

edit:

Because new music is awful now. Everyone is listening to the old stuff.

You and others with this sentiment: try harder. The amount of good stuff out there is absolutely ludicrous. Expand your mind beyond US FM radio. Or even internet or satellite radio.

 

[lxskllr]

Yup.

I don't even know how these streaming services make money. I don't know anyone who pays for the streaming subscriptions, and even the ads on the free versions are really sparse. Without ad block enabled I only hear 1 commercial every 10 songs or so, and it's usually only a 15-20 second ad for geico or progressive.

I assume these services have to host the music on server farms, as well as pay royalties for the music, so it has to cost some serious $$ to keep it going.

I used to have a Live365 subscription. I got for streaming niche music on demand. Want to hear Hammond B3 all day? No problem. Big band live remotes? Got you covered... I dropped it a couple years ago, and just listen to my collection, or use free streaming services. Right now, there's nothing I want to hear I don't already have.

 

[pyonir]

It's what everyone has said all along...give users more choices on how to get/listen to music. When they started hammering people with lawsuits and trying to shut down networks and sites, they didn't offer any alternatives. No adaptation to the market, no attempts to listen to their audience. Buy a CD or get sued were the options, unless you became a pirate.

It's amazing what happens when they actually stand back and listen to what the market demands (streaming music, itunes, etc) rather than try and litigate everything.

 

[PottedMeat]

these days i find if i want to listen to something i just go to youtube. no need to buy/download unless i really like it.

plus if you don't like the quality, someone else probably put up a better one

...and sometimes there's a download link in the description anyway

 

[Chrono]

$10 Spotify... worth it to me.

 

[Jodell88]

I blame the music industry for not producing more music that's worth downloading.

THIS!

All of the music I got in 2012 was free from the artist themselves.

 

[Wyndru]

Aside from the free streaming, another thing worth considering is how easily paid music is distributed now, especially in the mobile device market.

My wife never used to buy music, and now she is always on google music downloading new songs on her phone. An since it's cloud based, she can listen to that same music on any internet capable device. She has the music available in her car, on her computer at work and home, on her phone and on her tablet. And there are always sales on albums and samples that she downloads, so it really isn't that expensive. Since the account is associated with the CC, it's as simple as pressing a button to get the music. I know it's nothing new, but it's a lot more commonplace now.

It reminds me of what steam did for video games. The more available, cheaper and simple it is to obtain, the more sales. Go figure.

 

[Cuda1447]

Spotify and similar services. That's why.