Some Funny Statistics from Australia

Forget the spin, taping is not killing music (Slashdot discussion: CD-Rs and MP3s Not Hurting Record Sales)

A Record Industry Association survey suggests that an astonishing 40 per cent of us have received homemade CDs as gifts, typically four each during the past year.

The industry wants us to feel bad about this. It says we are guilty of theft (or at least of receiving stolen goods).

[…] But creating CDs is different from stealing CDs from a store, and the industry’s figures bear this out.

The recording industry survey was carried out by Quantum Market Research using a sample of about 1000 people. It suggests that 31 million homemade CDs are given away as gifts each year (about four for each of the eight million Australians it says receive them). If, as seems reasonable, 31 million homemade CDs are kept rather than given away, the total number created each year would top 62 million.

When something is stolen there is normally something missing. A dent of 62 million in CD sales in stores each year should be easy to spot. Except for this problem. CD sales in Australian stores have hardly ever been that high. They peaked at 63 million in 2001.

If, as the industry suggests, each of the CDs made on a home computer was indeed created at the expense of one sold in a store the entire industry would have been wiped out.

In fact while 2001 was the industry’s best year on record, 2002 was its second-best year, with sales only a few per cent lower.

[…] [University of Texas economist Stan] Liebowitz says we are in the middle of a “wonderful natural experiment” which will determine fairly quickly whether the latest high-tech copying machine causes the sort of damage the other machines didn’t. He adds that from an economist’s point of view it would be no real disaster if it did. The present recording industry would be replaced by something better able to make money in the changed environment.

But all the indications are that the recording industry we know will be around for quite some time yet – side by side with homemade CDs. In Australia CD sales through stores rebounded 5 per cent in the first half of 2003. The figures for the second half may well show Guy Sebastian has pushed the industry towards a near-record Christmas.