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February 27, 2013

NPD Group Reports Sharp Decline in Illegal P2P Music-Sharing in 2012

By Colleen Lynch, TMCnet Contributor

The NPD Group (News - Alert) has found that illegal music file sharing saw a significant decline in 2012, proving the mass efforts to combat music piracy have been generally successful.

The number of consumers using peer-to-peer (P2P) services to download music illegally was 21 million people, which marks a 17-percent decline in 2012 compared to 2011. This represents a significant shift from the numbers seen in 2005, when P2P file sharing peaked, when approximately 33 million people actively “stole” music.

“Stole” is in quotes because the legalities of this issue are still in a grey area, and many believe downloading music files from unlawful Internet sites isn’t the same as theft. This mindset has kept P2P music sharing sites running well into 2012, but the NPD group is hopeful that this will change.

“For the music industry, which has been battling digital piracy for over a decade, last year was a year of progress,” said senior VP of industry analysis for NPD, Russ Crupnick.

Crupnick attributes this change to multiple factors, including the popularity of music streaming services like Pandora (News - Alert).

“The increased use of legal and licensed streaming services has proven to be an alternative for music fans who formerly used P2P networks to obtain music,” said Crupnick.

In addition to this trend, legal action has greatly contributed to the shift.

“The music industry has successfully used litigation to shut down Limewire and other services,” said Crupnick. “Many of those who continued to use P2P services reported poor experiences, due to rampant spyware and viruses on illegal P2P sites.”

Limewire was shut down in 2010, and was previous to that point the most popular P2P file-sharing service with consumers. In the study, 20 percent of users cited the death of Limewire as a significant factor in their decision to download less music illegally, or to stop entirely.

NPD’s “Annual Music Study 2012” found that overall, the volume of downloaded music files shrank in accordance with the number of downloaders, declining 26 percent from the previous year.

Users involved in the study largely reported a complete halt in their illegal music downloading activities, rather than simply downloading less, because of the increased number of legal – and free – music streaming services.



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