There's been no shortage of research reports in the last decade that suggest file-sharers are also some of the best music consumers, but the latest one has been released just as the British media are focusing on the issue, following Peter Mandelson's announcement last week that the government plans to include a three-strikes anti-piracy programme in this month's Digital Economy Bill.
The new report comes from think-tank Demos, and was sponsored by Virgin Media. The cable TV company have been less critical than most internet service providers of the three-strike proposals, which will see persistent file-sharers having their net access suspended, though insiders say bosses at the telly and internet firm are increasingly frustrated that EMI, Sony and Warner won't sign up to the Universal Music-backed all-you-can-eat MP3 service they are developing.
Presumably the sponsors are happy with the Demos report's headline finding, that the record companies shouldn't see file-sharers as the enemy, but rather develop compelling licensed music services that maximise those music fans' annual spend on recorded music. Perhaps by signing up to Virgin's proposed 'unlimited MP3 downloads for a monthly subscription' package.
The Demos report concluded that nearly three-quarters of the population paid for the majority of the music they acquired, while nearly two-thirds never tapped into unlicenced content sources. Meanwhile those who did admit to file-sharing still spend an average of £77 a year on recorded music, which is £33 more than those who claim to never access illegal sources of music content. 83% of those who file-share reckon they buy more music as a result, while 42% say they used file-sharing primarily as a 'try before you buy' preview service. Even those file-sharers who are not also buying music still pay for other content services, such as Sky Plus, suggesting that if music companies would only offer the right kind of service they could still turn those fans into customers.
On pricing issues, there was little support for a blanket music levy being applied to all ISP accounts - one albeit less favoured proposal for overcoming the online piracy issue. Users also said that licensed music services should charge less, arguing that doing so would result in more file-sharers going the legit route, boosting overall revenues. Researchers say that 45p per MP3 download would be much more attractive to file-sharers, while five pounds a month was an attractive figure for an unlimited track subscription service.
Of course, the Demos report does conveniently seem to show that Virgin's proposed all-you-can-eat download model is the perfect way for record companies to combat file-sharing, which might make you a little cynical about the results overall. But given anyone with a brain knows that even an effective three-strikes net-suspension system will only have limited impact on illegal file-sharing, any research on how licensed services can better engage and attract customers is probably worth checking out.
Commenting on his report, Demos researcher Peter Bradwell told reporters: "This research demonstrates that cutting file sharers off may not be the best solution for the government if they are intent on helping the music industry. Politicians and music companies need to wake up to the changing nature of music consumption and embrace the demand for new business models that offer lower prices and easier access to music".
In sort of related news, Jack White has said that the music industry is in a "dying era", adding that artists now needed to use "trickery" to make money. He was talking about the 'pop up shop' that was erected at the back of his NME Halloween show in Shoreditch this weekend, which was selling glow-in-the-dark vinyl with a Halloween theme.
White: "It's great that people can come down here and get something that's real, and tangible and not disposable like an MP3 download that you can fast forward or throw away. The new generation needs to be taught about the beauty and romance of a record store".
On the ongoing challenge for new artists trying to get money out of their fans, he continued: "It's a dying era right now for music and art, things are crumbling. Every meeting we have with a label is depressing, and you wouldn't believe how hard it is, and how much trickery goes into a band just breaking even. It's going to be so hard for bands in ten years".