Over the past several years numerous studies have looked at the effects of piracy on the music industry.
One very consistent result seems to be that pirates are not by definition cheapskates. On the contrary, they tend to spend more money on merchandise, theater visits and concerts.
This week a new study conducted by the entertainment industry research firm MusicWatch confirmed this trend.
First off, the results of the survey debunk a popular belief that the number of music pirates is falling. While P2P sharing appears to be down, the use of popular alternatives including mobile apps and direct download sites has increased.
Overall, the study estimates that 57 million Americans between the ages of 13 and 50 admit to acquiring music through unauthorized sources. That’s a very significant number which will undoubtedly cause concern among music industry executives.
In part people turn to piracy because they don’t want to pay. However, there’s also a large group of legal music consumers who pirate tracks in addition to buying CDs or paying for legal downloads.
More than one-third of all music buyers (35%) pirate tracks on the side. Interestingly, this group appears to consist of the music industry’s most valuable customers.
The results show that average Americans (pirates included) spend $19 on CDs and music downloads per year, a number that goes up to $33 among pirates alone.
Similarly, the study finds that the average music buyer (pirates included) spend an average of $45 per year, compared to $61 for the subgroup of pirating music buyers. Extra data which MusicWatch kindly shared shows that non-pirates spent just $36 on average.
In addition, the results also show that pirates are more likely to use paid streaming services.
The findings clearly show that pirates spend more money on legal music than those who only consume music through authorized sites and services. So how can this be?
The most logical explanation for this finding is that “pirates” are more engaged than those who don’t share, and that they complement their legal purchases with unauthorized downloads.
Of course, none of the above says anything about the effect of piracy on legal consumption. The people who are now classified as pirates may pay even more if piracy disappeared overnight, or less because they can’t sample any music.
What it does show is that half of all music pirates are paying customers and these people are bringing in a lot of money. If anything, the music industry should be cautious to brand these pirates as thieves, because they are their most valuable consumers.