Thursday, October 07, 2004

What's in a number?

(This is my first post in a few days as I've been laid low by some medical matters since Monday. Hope to resume regular service soon.)

There's an old joke about people's willingness to take statistics too literally: "Statistics say that one in five people in the world is Chinese, but I come from a family of five and none of us is Chinese." Today, in conjunction with its legal salvo against file sharers (in tandem with the IFPI's suits against 459 heavy users across Europe), the British Phonographic Institute (BPI) has stated that 15% of file sharers are responsible for 75% of content on P2P networks ( If recent P2P user statistics are accurate, this suggests that the labels should ultimately pursue action against 1.5m people globally, which won't do much for industry margins.

Anecdotally, it's pretty widely accepted that P2P sharing activity is not symmetrical, and the "free rider" phenomenon is a well-documented source of network inefficiencies in P2P networks. However, we also have to acknowledge that the labels are shooting at a rapidly moving target. The P2P user base is almost certainly expanding in line with broadband growth, and the most explosive growth is in some places where the mechanisms for enforcement along these lines are far from clear - China is now the world's largest installed base of DSL users, with 13m lines. Moreover, it's far from clear that the underlying motivations of file sharers are as straightforwardly sinister as the industry would have us believe, or that the net effect of sharing is actually negative (both issues which we touched on here

Lastly, the knock-on effects from actions such as this have historically been unpredictable. An industry analyst quoted in the BBC article linked-to above rightly states that a certain proportion of the youngest generation of file sharers may prove hard for the labels to convert to willing consumers of CDs, due to conditioning. However, it is inconceivable that goodwill towards the labels among such young consumers will be enhanced by litigation, while the lure of file sharing as "something naughty" may conversely be reinforced. The industry is targeting KaZaA, Gnutella, and eDonkey users in Europe this time, though as with the RIAA lawsuits in the US previously, this may merely lead to user migration to other platforms with lower profiles, or worse from the perspective of enforcement, closed systems, such as W.A.S.T.E.

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