Six-Figure Piracy Fine Stands, Ex Warner Exec Admits Piracy Drives Sales

Joel Tenenbaum, a 28-year-old Rhode Island resident who's been battling the Recording Industry Association of America (RIAA) since 2009 over a $US675,000 fine for downloading and sharing 30 songs (by artists including The Smashing Pumpkins, pictured), has had his right to appeal refused by the US Supreme Court.

The fine had been reduced to $67,500 at one stage before an appeal returned the sum to its full amount.

Tenenbaum is arguing that his actions fall under what he considers "consumer copying".

RIAA lawyers, who labelled Tenenbaum a "hardcore" infringer, are arguing that illegal downloading cuts revenues for the industry.

This is at odds with a recent study out of North Carolina State University, revealed by Techdirt last week. Research found by Robert Hammond, an assistant professor at NCSU, suggests that when a popular artist's album leaks, it actually helps drive sales. He says:

To put this result into context, consider the effect of leaking one month earlier on the sales of an album; that is, predict the effect of leaking one month earlier on the number of additional seeders per leecher, then predict the effect of these additional seeders on the number of additional downloads, then finally predict the effect of these additional downloads on the number of additional sales. This exercise predicts that an album that leaked one month earlier will receive 59.6 additional sales.

Whilst Hammond might not explicitly declare that piracy drives sales, the following tweet from Warner's former Chief Technology Officer Ethan Kaplan certainly doesn't require any reading between the lines :

@BigChampagne @techdirt good christ. Let me simplify this answer: YES IT LEADS TO MORE SALES. DEMAND = DEMAND W/ $$$$$$ IF PRODUCT GOOD.

— Ethan Kaplan (@ethank) May 18, 2012

Tenenbaum will continue to fight the penalty.