I am forwarding this document as an attachment to this email so that you can make your own analysis and perhaps pose questions to Stephen Peach of ARIA (02 8569 1144) for his organisation's clarification based on this follow up research analysis.

Although called an industry analyst I am hardly an expert in statistics, more a commentator on music industry issues. But when confronted with this enclosed analysis, felt I should throw open the questions to both the media and the initiators of the report to query and comment.

As one who does not file share music, does not download music from the Net unless I pay for it (using Apple iMusic Store as an example purchasing tracks from the US for my iPod personal music device) and a music industry professional who does not agree with illicit use of music, I still maintain that consumers like myself--who elect to copy their own purchased music on CD or vinyl--should have the right to make legitimate copies for personal use. At present, those of us who make backup copies, create our own compilations of songs from our own purchased disc or who transfer music onto tape for car use or into a digital storage device or player, are criminals under the current laws.

The law needs to be changed to keep up with modern technology to benefit the consumers who have invested in music. Yet the copyright owners of music--songwriters, performers and their record companies and publishers--as investors in the production of music should not lose rights or income legitimately due them. It's a fine balance that faulty statistics will not create a legitimate solution.

Ed. note: we'll have response from ARIA as soon as possible.

Questions on Aria sponsored internet/piracy study

* How was parental permission obtained for those under the age of 14? Was the 1st question asked "how old are you". If the answer was less than 10 was the interview terminated, or did the interviewer ask to speak to someone older? If the answer was between 10 and 14 did the interviewer ask to speak to the parent? If the parent's permission was obtained did they interviewer then say "can I speak to the person I first spoke to?" How many parents refused to grant permission to speak to the person between 10 and 14?
* How did the interviewer ensure that those sampled reflected the Australian population? Doesn't that mean the sample wasn't random?
* How many interviews were commenced but not completed? What happened to the interviews that were not completed? Were they eliminated from the survey results?
* Were there 1001 interviews undertaken or 1002 interviews?
* What does "weighted sample of 1,002 interviews mean?" How was the sample weighted?
* What is a "proportionate quota?" How was it obtained?
* How was the sampling error measured?
* How was the confidence interval measured?
* According to your figures 1.8 million Australians have illegitimately downloaded music files via file sharing services last month, and 3.5 million Australians have used these services over time, yet according to the Organisation for Economic Cooperation and Development report into broadband there are only 300,000 broadband users in Australia, and not all of them download music. If say (conservatively) half the broadband users download music, your totals suggest the other 3.35 million downloaders use dial up services. According to your analysis, that means that some 96% of downloaders use dial up services to download music. How do you reconcile this figure with your stated figure of 72% of downloaders using dial up services? With respect, in practice, it is virtually impossible to download music without a broadband connection, so how do you reconcile these 2 figures with the actual incidence of downloading from a dial up service?
* Even if we accept that 21% of file shares use broadband and 72% use dial up services, what do the other 7% of downloaders use?
* According to your figures 3.6 million Australians have illegitimately burnt a music CD in the last 6 months. How do you distinguish between “illegitimate” and legitimate burns (such as when the user owns the IP rights in the source recording or has the permission of the copyright owner)? How many users have legitimately burnt a music CD in the last 6 months? Why aren’t these figures included in the analysis? Or was it assumed that all CD burning was inherently illegal?
* How could only 7% of Australians have obtained music through CD burning and file sharing, given that according to your figures 3.6 million Australians acquired music from CD burning and 1.8 million from file sharing services? Surely according to your own figures, that means that at least 4 or 5 million Australians would have obtained music through CD burning and file sharing?
* According to your figures 40% of those under 25 took part in illegal CD burning in the last 6 months. According to the ABS 2001 survey there are 6.5 million Australians under the age of 25. That means 2.6 million Australians under the age of 25 took part in CD burning in the last 6 months. How do you reconcile these figures with the information provided by the National Office for the Information Economy which suggest that the majority of young people in Australia (especially in regional areas) still do not have home access to state of the art computing facilities (which presumably includes CD burners).
* According to your figures 33% of Australians under the age of 17 used a CD burner for music copying in the last 6 months, yet you did not survey those less than 10 years of age, and only surveyed those between 10 and 14 with parents’ permission. How do you reconcile your stated results with your research methodology? Did you actually intend in your survey results to say that 33% of Australians between the ages of 14 and 17 used a CD burner?
* According to your figures the source materials for burnt CDs are owned CDs, borrowed CDs and the internet, yet if these percentages are added up, they total 116%. How is this explained?
* Your attitudes survey suggests that 57% of the general population believe that burning CDs is like stealing, yet 54% of the time CD burners were used by consumers to make back up copies of their source CDs, which are typically regarded as being legal, based on a personal use/legitimate back up argument, such as the type accepted under US law. How do you reconcile these 2 conflicting figures?
* Your survey says 40% of the population have “at some stage” received a burnt CD. Your survey says 3.9 illegitimately CDs have been received in the last 12 months. Many of the other figures relate to activities in the last 6 months (such as burning a CD in the last six months). Your survey also asks about using file sharing services in the last month. Your survey also asked about file sharing services used in the last week. As a matter of practice, how could the survey (within an average time period used of 15 minutes) ask about CD burning and downloading by the consumer, and ask them about their activities, which have “ever” taken place, as well as their activities that have taken place in the last year, in the last six months, in the last month, and in the last week? For practical and comparability reasons, in my experience, surveys tend to limit themselves to 2, maybe 3 time frames in their questioning.
* According to your survey, 8 million people received an average of 3.9 burnt CDs in the last 12 months. That suggests that some 32 million CDs were burnt and passed onto other people. (Given an Australian population of 20 million, that explains how you indicate that the amount of CD burns is equivalent to 1.6 copies per capita – 20 multiplied by 1.6 equates to 32). Presumably, at least that many CDs were burnt by users and retained by themselves. That suggests that at least 65 million CDs were burnt in the last year in Australia. According to IFPI’s figures about 60 million CDs were shipped last year. Does that mean for every CD sold in Australia, a CD is burned? Doesn’t that make Australia’s piracy rate at 50% one of the worst in the world? Isn’t this analysis inconsistent with Aria’s own figures, which suggest that piracy rates are running at less than 10% of legitimate sales?
* If we accept the 32 million burnt CDs figure in Australia as correct, how do you reconcile this figure with your survey results, which suggest that 4.8% of all music acquired by the general population were acquired from CD burning. If 32 million CDs represents 5%, that suggests that 650 million CDs were sold in Australia in the last 12 months, which is actually more than combined sales from the last 10 years!
* According to your figures 1.8 million Australians have used a file sharing service in the last month, and the average number of files downloaded by these individuals is 19.6 files. This suggests that 36 million files were downloaded last month. If applied over a 12 month period, this suggests that Australians downloaded 430 million files in the last 12 months. Yet you also say that file sharing accounted for 5.9% of the total volume of music acquired. Given that record companies shipped some 60 million CDs last year, how does 430 million files equate to only 5.9% of this market? If these figures download figures are correct, the Australian market equates to 7.3 billion music files per year, or some 900 million CDs per year – not the 60 million or so CDs actually shipped last year.
* Your survey suggests that the public is aware of the criminality of illegal musical downloads and CD burns, yet they continue to undertake these activities. Every other survey I have ever read (including those supported by RIAA) suggest that most of the public are unaware of the criminality associated with these activities. This lack of awareness was one of the reasons/justifications for RIAA and IFPI devoting so much of their resources to educational and public information dissemination activities. If the well informed Australian public is aware of the criminality associated with these illegal activities, doesn’t that mean the Aria should reduce its PR activities and should instead focus more on enforcement activities, since people know its wrong but keep doing it?
* The table on file sharing and its impact on legitimate sales suggests that CD sales have decreased 12% amongst file sharers as a result of file sharing, with file sharers representing 21% of the general population. The analysis also suggests there has been an additional reduction in CD sales due to CD burning. (82% of the 8 million recipients of CDs would rarely or never buy the CD burned for them). Yet according to Aria’s own figures released in January there was a 4.4% decrease in sales of recorded music (CDs, cassettes, MDs, DVD etc) in Australia in 2002. This followed many years of growth. How do you reconcile your survey results which demonstrate a serious reduction in sales due to piracy, with the relatively modest decline in actual sales – especially once you discount from the reduction in actual sales the impact of “increased interest in DVDs and computer games, unsettled economic conditions and a tough retail environment”, which were cited as reasons for the fall in sales in January.