France’s three-strikes anti-piracy law is one of the strictest in the world. It employs private companies to scan file-sharing networks for copyright infringement and sends warnings to pirates if they’re caught red-handed. The law, enforced by a French authority called Hadopi, was instated 17 months ago to the applause of music copyright holders and their representatives. Although an early study originally showed piracy had actually increased after the anti-P2P law passed, Hadopi released a report this March saying French ISP users had significantly decreased their illegal file sharing. Despite that announcement, the French music industry still saw a decline in revenue.
Hadopi used the reports of two different companies to ascertain the decrease in pirated traffic. One metric said illegal data sharing on peer-to-peer networks decreased by 43 percent, another survey used a different methodology and saw a 66 percent decrease in illegal P2P traffic. While Hadopi only monitors peer-to-peer networks, its recent study noted there’s “no indication that there has been a massive transfer in forms of use to streaming technologies or direct downloads.”
For all the fanfare in Hadopi’s 14-page report celebrating the crackdown on music and video piracy, the music and video industries in France did not see increased profit in 2011 compared to the year before. The overall recorded music industry saw a 3.9 percent loss, and France’s video market dropped 2.7 percent overall.
The depressed sales likely won’t take copyright holders off the warpath. In fact, both music and video industries saw significant increases in purchases of digital media. In music, download revenues increased by 18.4 percent. Streaming and subscriptions revenue grew by 73 percent, largely due to the rising popularity of Spotify and Deezer. According to a domestic video publisher’s group, video-on-demand sales increased 50 percent.
An article on the French website Numerama also noted that streaming music played a large part in increasing sales of digital music downloads, and surprisingly, concert tickets. Streaming music did not, however, influence a user’s impetus to buy CDs.
These numbers show that despite the hemming and hawing about piracy eating up entertainment industry revenue, the transition from physical discs to digital files is a huge factor in negative growth. No matter what, music industry officials are unlikely to let up on piracy. More than likely, they will adopt the argument that media sales would be even lower without ISP monitoring.