It is difficult to determine the true economic impact of what has erroneously come to be called piracy (the word piracy implies unauthorized reproduction for commercial gain, whereas most file sharing is just that—the transfer of digital files with no money changing hands). A number of studies have shown that piracy has little to no effect on purchases, while some have found a positive correlation, presumably because file sharers are also some of the most passionate music fans, and thus the expanded exposure brought about by piracy can increase sales among the devoted. Regardless, the recording labels and their lobbying organizations (RIAA and IFPI) seized upon this development to advance what David Arditi calls the “piracy panic narrative,” a conflation of file sharing with piracy, and thus stealing, which victimizes artists. The news media, much of which was owned by the same conglomerates that owned or had relationships with the recording labels, faithfully relayed this justification for why the recording industry was struggling financially, even though internal industry documents showed that the industry itself acknowledged the host of other reasons that accurately accounted for the drop in sales around the turn of the century: the maturation of the CD-replacement cycle, economic uncertainty, competition from video games and DVDs, the lack of a legitimate MP3 market, and the narrow focus on superstar artists at big-box stores.
Andrew DeWaard, Derivative Media: How Wall Street Devours Culture
