Hot:

Location Location Location.

In the Western Suburbs of Sydney, in 1994, a small video chain opened a subsidiary shop with approximately 1500 video titles (VHS) and three staff members.

Today the store has twelve full-time employees, several part-time employees and according to the store evening manager, “doing better than in all the years he has been there” (since 1994).

The store is conveniently far enough away from the nearest Woolworths (8 km) or Aldi (11 km) or Coles (7 km) discount DVD sales bargain Bin.

There are no Pawn shops or second hand stores for at least 15 km.

There are however, seven primary schools and three secondary schools within a 9 kilometres radius.

69% of the local residents have broadband installed in their homes.

“The DVD’s are racing out of the store” he said, “especially on discount Wednesdays and Thursdays. People hire ten at a time sometimes”.

I looked around the store. At 7:00 pm there were approximately 25 people browsing the shelves, four people lined up at the counter and three staff members serving them.

The customer numbers were reminiscent of the first video shop [Video World] in Australia that I opened in Darwin in 1982, in the years prior to Foxtel, Satellite and file-sharing.

“So doesn’t file sharing hurt your rentals?” I asked.

He replied, “You mean Torrents, don’t you?” I nodded, “Nah, I think everyone does it, but then they run out of their monthly download limits and they rent movies like they always did.”

“What about Foxtel?” I asked.

“We hear that a lot. Nothing worth watching on Foxtel, that’s why they’re in here.”

That was about it. I asked him some questions about his numbers, thanked him politely and left to go home to Google “Torrent” Trends.

A year or so ago, we did an article on global rising trend for torrents and found that Melbourne Australia was a global hotspot for Torrent interest which appeared to concentrate on Craigieburn.

Well stats have a habit of changing. Here are the stats for Torrent interest by City from around the world.

The Top Ten Torrent Cities in the World.

World Rating	City	Torrent Score
10	Milan (Italy)	0.36
9	Warsaw (Poland)	0.385
8	Helsinki (Finland)	0.405
7	Sydney (Australia)	0.415
6	Toronto (Canada)	0.445
5	Melbourne (Australia)	0.45
4	Amsterdam (Netherlands)	0.465
3	Montreal (Canada)	0.53
2	Delhi (India)	0.75
1	Budapest (Hungary)	1

N.B. Total Torrent Score is just on 5 as at March 2010, so the torrent scores are a total of 5 as a percentage therefore Hungary represents one fifth of all torrent Google searches  and Sydney just under one tenth – Ummm, that’s ten percent of the worlds searches for Torrents – Just in case there was a misunderstanding.

Sydney, the home town to the little corner video store, at number 7 on our Top ten chart.

Some would say being in the top ten of cities most interested in Torrents is bad. Like IPRI, who’s report we analysed last year.

We said:

Notwithstanding that in the writers opinion they have understated dramatically the amount of P2P actually occurring within a number of countries, for example within Australia, the latest Whirlpool Internet Report (http://whirlpool.net.au/survey/2008/) shows that 53% of Australians utilise file sharing software.

…Another way of looking at the data is comparing the volume of P2P to the IPRI rating for the country. It would appear that  generally, the higher the IPRI rating – the lower the P2P file sharing AND the lower the Real GDP accelerated growth

In the UK, DVD rentals are reducing because ….

… it would appear that they are being cannibalized by the industry itself via sales.

So for a city that is rated number five and number seven on the world top ten trend for interest in Torrents, how did we do in this years Digital Music Report?

Strong downloading demand helped Australia become one of the few developed music markets to achieve the “holy grail” of overall growth in the first half of 2009, as the rise in digital music sales offset a small decline in revenues from physical formats. Digital album sales nearly doubled in the first half of 2009, representing almost 8 per cent of overall album sales, and digital albums are proving especially popular in the early days after a title’s release (ARIA).

[Authors comment on the foregoing sentence. File sharing has always been about the lack of available legal digital content, therfore we would have thought that is was no suprise to the industry that users wanted day/date releases of music, movies and Television shows. It irks me somewhat for IFPI to make the declaration as if it was a deep revelation that was arrived at by some academics after ten years of research.]

It took Australia one five year generational wave to move from a loss making situation to a profit situation.

When did iTunes arrive in Australia ? 25-Oct-05

Well gee, Koltai, File sharing must have damaged something…… what about the movies?

With Australian cities holding the fifth and seventh position on Google trends for inquiring about Torrent downloads, cinema ticket sales must be falling huh?

I guess not.

What about those Hungarians…. They must be killing the cinema in Hungary.

Apparently not. From Hungary’s Online English Business Daily News;

Cinemas in Hungary sold 6.95m tickets in the first eight months of 2009, an increase of 142,000 from the first eight months of 2008, the business daily Napi Gazdasag reported on Friday.

Revenue from the ticket sales reached HUF 7.35bn (EUR 27.3m) in January-August, up HUF 687m yr/yr.

Clearly now that digital downloads are becoming commonplace and digital catalogues are starting to look healthy, sales as well as video on demand are obviously matching the availability of the content or is it that we reached a point in time where digital content catalogues are finally matching the consumers requirements for content.

So the only question is why the industry continues to insist that file sharing damages it’s member clients business models.

Glossary:

Foxtel: Australian cable TV, sort of like HBO on a diet forced to regurgitate every piece of content 20-50 times a year.

References:

DMR2010 IFPI

2009 IPRI Report IPRI

N.B. I repeat, we don’t believe the IPRI P2P numbers at all… and we have the stats from our very own Lugundum server that we ran last year (at the same time as IPRI were compiling their report, which shows a direct correlation between GDP growth and P2P, which is merely hinted at in the above Graphic. (The purple P2P area are from IPRI supplied numbers.)

Yes, we will eventually be publishing our findings in this regard.

Ibid.

Google Trends; Torrent

World = http://www.google.com/trends?q=torrent++&ctab=0&geo=all&geor=all&date=all&sort=0

Australia = http://www.google.com/trends?q=torrent++&ctab=0&geo=au&geor=all&date=all&sort=0

Get ThePicture

http://www.screenaustralia.gov.au/gtp/wcboadmission.html

Original data supplied by MPDAA.

Cinema attendance rises despite economic crisis

http://www.realdeal.hu/20091012/cinema-attendance-rises-despite-economic-crisis

About the Author:

Tom Koltai is an Economist in Sydney Australia.

He has not been paid by anyone to write this article.