Study: Contrary to What Labels May Say, Leaking an Album Is Actually GOOD for Business

When an album escapes into the wild before its planned release date, artists, managers and labels tend to freak out.  Months of careful marketing plans are thrown into disarray, not to mention the fact that sales of the record are jeopordized.

Or are they?

TorrentFreak reports on a new paper from North Carolina State University that seems to indicated that albums leaked on the Internet and then distributed illegally through torrents does not negatively impact sales.  In fact, the study says, such a leak may actually help sales.

For more than a decade researchers have been looking into the effects of music piracy on the revenues of the record industry, with mixed results.

None of these researchers, however, used a large sample of accurate download statistics from a BitTorrent tracker to examine this topic. This missing element motivated economist Robert Hammond, Assistant Professor at North Carolina State University, to conduct his own research.

In a paper titled “Profit Leak? Pre-Release File Sharing and the Music Industry” Hammond published his findings.

Between May 2010 and January 2011 the professor collected a variety of download statistics of new albums that were released on the largest private BitTorrent tracker dedicated to music. He then used this data in combination with sales numbers to construct a model that predicts what the causal effect of piracy on music sales is.

The results are unique in its kind and reveal that BitTorrent piracy causes an increase in album sales.

Fascinating, huh?  Read the rest here.