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Piracy perspective

Study downplays file-sharing in music woes

The music biz can’t pin all of its recent sales woes on file-swapping pirates, according to a study of Net-savvy consumers’ buying habits over the past year. Results were unveiled Wednesday by the music arm of research firm the NPD Group.

Sales of full-length CDs in the U.S. slumped by 13% in the fourth quarter of 2002 compared with a year earlier, NPD Music calculated. And sales for the first quarter of 2003 were 9% lower than those in the prior period.

Above board

But while the firm attributes more than half of the slump to free file-sharing activity on services like Kazaa and Morpheus, it said a significant portion of the decline comes from outside the realm of pirating peer-to-peer users.

NPD said 60% of music buyers with access to the Web have never downloaded free music from file-swapping sites. Among those law-abiding Net surfers, sales fell by as much as 7% in the first quarter.

“Our research shows that even if digital file-sharing were to disappear tomorrow, the record labels and retailers would still need to overcome important underlying causes of recent market declines,” said Russ Crupnick, vice president at NPD.

Ironically, NPD said some of the most acute declines are coming from older music buyers — a group not generally associated with illegal file-sharing or digital piracy of any kind.

In with the old

The firm said the older consumers that were interviewed complained of a dearth of interesting new material, adding that many of these would-be record buyers look instead to the catalog bins for artists like the Rolling Stones and Bruce Springsteen.

The music industry has begun to wake up to the potential of the 36-and-older set over the past year after the blockbuster success of Norah Jones. The jazzy songstress sold more than 6 million copies of her debut disc in the U.S., driven in large part by older fans.

NPD recommended several tactics for tapping into the malnourished older market and reversing the downward sales trends, including a greater focus on “legacy” artists to repeat the success of recent compilations of the Beatles and Elvis Presley, create special sections at retail catering to older buyers and retool marketing strategies to break the industry’s focus on youths.

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