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Music or Hi-Tech Lovers? An Empirical Analysis of the Digital Music Market in Italy

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  • Francesco BALDUCCI

    () (Universita' Politecnica delle Marche, Dipartimento di Economia)

Abstract

Using survey data on cultural consumption by about 650 university students, this article proposes a market segmentation and some rule-of-thumb policy implications for the music industry. Consumption behaviors, listening habits and musical preferences are explained by a large number of variables Nevertheless it is possible to reduce this overload of information into two common factors (using factor analysis). Cluster analysis is accordingly used to group the students-consumers: the digital music lovers cluster is the most profitable for the music industry, whilst those of uninterested subjects and pure hi-tech lovers are the least. The analysis shows that the new digital technologies (for example file sharing) may be harmful for the music industry only within one specific group of consumers. New technologies can instead promote music consumption (especially of live music) by the other categories. By investing in music knowledge and enjoyment, it is possible to make consumers buy digital music legally from authorized sites.

Suggested Citation

  • Francesco BALDUCCI, 2008. "Music or Hi-Tech Lovers? An Empirical Analysis of the Digital Music Market in Italy," Working Papers 324, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
  • Handle: RePEc:anc:wpaper:324
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    File URL: http://docs.dises.univpm.it/web/quaderni/pdf/324.pdf
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    References listed on IDEAS

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    1. Rob, Rafael & Waldfogel, Joel, 2006. "Piracy on the High C's: Music Downloading, Sales Displacement, and Social Welfare in a Sample of College Students," Journal of Law and Economics, University of Chicago Press, vol. 49(1), pages 29-62, April.
    2. Donata Favaro & Carlofilippo Frateschi, 2005. "A Discrete Choice Model of Consumption of Cultural Goods in Italy: the Case of Music," "Marco Fanno" Working Papers 0010, Dipartimento di Scienze Economiche "Marco Fanno".
    3. Lonnie Stevans & David Sessions, 2005. "An Empirical Investigation Into the Effect of Music Downloading on the Consumer Expenditure of Recorded Music: A Time Series Approach," Journal of Consumer Policy, Springer, vol. 28(3), pages 311-324, September.
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    Cited by:

    1. Eralba CELA & Tineke FOKKEMA & Elena AMBROSETTI, 2012. "Links Between Transnationalism Integration and Duration of Residence: The Case of eastern European Migrants in Italy," Working Papers 386, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.

    More about this item

    Keywords

    market segmentation; media; music; technological change;

    JEL classification:

    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • Z11 - Other Special Topics - - Cultural Economics - - - Economics of the Arts and Literature

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