iTunes Over P2P? NPD Group's Suspect Research.

By Jon Newton 6/08/05

The NPD Group is a market research firm which suddenly appeared out of nowhere in late 2003 and which the mainstream media immediately began quoting as an authority on music and file sharing.

When we first came across it, adidas International, International Flavors & Fragrance and Wrigley typified its client base, but it was nonetheless churning out ‘studies’ and ‘reports’ bolstering entertainment cartel party lines.

We emailed NPD wondering how many years' experience it had in the music research field and asked about the team of interviewers/statisticians we thought it must boast given the nature and number of its outpourings.

Jon Newton

We never did hear back, and when we visited the NPD site, we weren't able to find a single music, or other entertainment industry, client, although since then, the company has added movies, music, video, TV, etc, to the list it professes to be expert in.

We mention this because now NPD is touting iTunes as a “formidable competitor against free peer-to-peer (P2P) file-sharing services," an assertion which is, of course, complete and utter nonsense.

The corporate online music business exists only in the minds of the media and those trying to promote it and iTunes’ sales of some 300 million since it started in September, 2003, don’t even merit a statistical blip against what's happening in the real world of online music.There, the p2p applications and networks rule and iTunes is a joke.

P2p research firm BigChampagne says in the US in May, on average 6,290,327 people were logged onto the p2p networks at any given moment. The global statistic was 8,665,319.

And yet, “According to information from NPD’s MusicWatch Digital service, Apple iTunes’s industry-leading a-la-carte download store tied with LimeWire as the second-most-popular digital music service in March, 2005,” says MacDailyNews. “Both iTunes and LimeWire were used by 1.7 million households.”

Is this possible, p2pnet asked LimeWire coo Greg Bildson?

“I wonder at the source for their numbers,” he said. “Our numbers seem rather small here.

"I mean we get 6,000,000 or more downloads a month so we’ve got to assume that we’re in more than 1.7 million households. I don’t think iTunes is getting six million downloads a month on the software itself.”

Nonetheless, “One of the music industry’s questions has been when will paid download stores compete head-to-head with free P2P download services,” MacDailyNews has NPD spokesman Russ Crupnick saying, going on, “That question has now been answered."

And so it has:

Not in Crupnick’s life-time. runs an ongoing tally of how many users are on a specific file sharing network at any given moment (this number also appears on your P2P client when you use it). As of today the eDonkey network has 4.5 million concurrent users, FastTrack has over 2.4 million and Gnutella (which Limewire uses) has 1.6 million. How WinMX became NPD's most popular digital music service is a mystery to us and was an immediate clue that something was way off. One more note, I'm very surprised the alarm bells didn't go off at CNET when they ran their article on the report, which printed the information as a straightforward fact piece. They know the real figures as good as anyone else and should have questioned NPD's results immediately. -- editor.


Jon Newton is the editor of and is a regular contributer to MP3 Newswire. Jon's site is devoted to the politics of digital music and his insights as well as those of his co-writers can be read there. We urge you to explore it.


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