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CNET (and others) Get It Wrong, Miss the Actual Story

By Posted by Alan Wexelblat

I've been avoiding writing about the LimeWire debacle, not least because of potential conflict of interest (*). As always, I speak for me and nobody else. Not Corante, not my company, and certainly not Gorton or LimeWire.

With that out of the way, let me just say: CNET, you're wrong. Your headline writer is wrong, and Greg Sandoval (whom I normally think better of) is wrong. Allow me to demonstrate.

The headline is "LimeWire demise slows music piracy." And Sandoval faithfully repeats the claim of research firm NPD Group that

the percentage of Internet users who download music via peer-to-peer services was at 9 percent in the fourth quarter of 2010, compared to 16 percent in the same period earlier in 2007

Well, that certainly seems significant. In the three years since LimeWire was shut down, fewer people admit to shar... wait, you mean LimeWire wasn't shut down three years ago? Err, no. It wasn't. It was shut down in October of 2010. So approximately 2.5 months worth of LimeWire absence was included in the period measured, out of a total of 36 months. For those bad at math, that's less than 10% of the time.

The claim, then, is that an event that happened in the last 3 months of a three year period somehow caused a retroactive drop? Either that violates causality as I understand it, or someone in the P2P industry has invented time travel and isn't sharing it. Or maybe, NPD is full of shit and Sandoval is guilty of just repeating what he's told rather than thinking for himself.

To cut NPD a small amount of slack here, they do admit that former LimeWire users are moving to other sharing networks. But really, this is just marketing puffery. NPD has no idea what caused the drop in self-reported file sharing over the past three years. Maybe it was that people thought it was an increasingly bad idea to admit that they used LimeWire to random marketers when there was a relentless stream of bad headlines about LimeWire.

Or maybe - and here I think is where there's an interesting story Sandoval might have written - people are sharing music by new means. Look, for example, at music-sharing via Twitter, or how about a video that's over a year old telling people how to share music on social networks?

I found the above two links in under 15 seconds of "research". Were I an actual paid reporter - as Sandoval purports to be - I would have done some actual research (which is different from "market research" puffery issued to please a paying client) and found out more about where the music sharing has gone. P2P networks still have significant traffic in copyrighted files. But YouTube and Twitter and other "Web 2.0" sites have picked up an enormous amount of the slack.

And were I an actual paid reporter, I might have dug into what I think is possibly the most interesting music-sharing story of 2011, which is that people aren't downloading music as much anymore, but they're sharing it more than ever. Streaming music, both legal and illegal, is finally taking off in a big-time way. People no longer feel as much need to have their own copy of an MP3 on their disks because they're confident they can be connected all the time to a network that will supply them the sounds they want when they want it. Between broadband penetration to homes and a proliferation of pocket devices (mostly calling themselves cell phones) that have the ability to stream low-bitrate MP3s or better, we are likely to see the local storage of media go the same way as email has gone in the past decade. And that will impact old markets like P2P networks far far more than yet another sharing company shut down by the Cartel.

I hope to be writing more about this in the rest of this year.

(*) In my day job I work for a company in which Mark Gorton is a major stakeholder. I've met him twice at company parties. He has no impact on my livelihood directly, but the case against LimeWire has affected all the companies in which Gorton is invested. So there's a potential conflict that readers should know about when they consider my writing.

Full post as published by Copyfight - The Politics of IP on March 24, 2011 (boomark / email).