Do Anti-Piracy Laws Affect Record Sales?

For many music lovers, torrenting music these days is pretty much a way of life . This has been an expected consequence of the increased digitization of musical property. The real question: does it affect the sale of music? Norway may hold the answer as an example of sweeping legislation that combats piracy and the effects it had on boosting or diminishing record sales.

A recent survey conducted by IFPI, a music industry research group, found that just 4% of Norwegians under the age of 30 are downloading pirated music in 2014. That is down from 70% in 2009. Through considerable effort by the Norwegian government, legislation was passed that aggressively attacked the piracy problem in Norway. The new legislation gave new powers to rights holders to track down and block websites at the ISP level that torrent pirated materials. Canada has implemented similar efforts last year.

So far, it looks like the legislation is more threatening than anything. To date, not a single file sharing website or user has been prosecuted. Nor has any site been actually blocked, including the infamous pirate bay.

The logical result of this unprecedented drop in torrenting would be a boom in record sales, right? Not so, according to the IFPI survey. In 2009, record sales in Norway were around $76 million U.S. Dollars and have increased to $77 million U.S. Dollars in 2014. If you adjust for inflation, record sales have actually decreased.

So what happened? According to the same study it seems that people under 30 in Norway have fled the torrenting websites for free streaming sites like soundcloud or spotify. Marte Thorsby, IFPI Chief, did not connect the drop in piracy to legislation measures:

“We are now offering services that are both better and more user-friendly than illegal platforms. In [the past] five years, we have virtually eliminated illegal file sharing in the music industry”

The same study found that nearly 80% of people under the age of 30 are using legal music streaming websites in 2014.

“Younger audiences are using streaming services to the greatest extent. When older audiences [start] embracing these services we will probably see a somewhat different distribution of revenues… Hopefully this will also involve a better economy for several Norwegian artists and record companies.”

The one thing lacking in this study is that it doesn’t take into account the people between the age of 26-30 in the year 2009. Do they still heavily torrent music? It also doesn’t provide which age demographic is the heaviest user of torrents. Do you think that legislation will lead to the demise of pirated materials or is there a free market solution to at least stablize the record sales market?