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Dana Dana Blankenhorn has been a business journalist for over 25 years and has covered the online world professionally since 1985. He founded the "Interactive Age Daily" for CMP Media, and has written for the Chicago Tribune, Advertising Age, and dozens of other publications over the years.
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Moore’s Law defines the history of technology. It held that the number of circuits etched on a given piece of silicon could double every 18 months as far as its author, Intel co-founder Gordon Moore, could see. Moore’s Law has spawned constant revolutions since then, not just in computing but in communications, in science, in a host of areas. Moore’s Law applies to radios, and to optical fiber, but there are some areas where it doesn’t apply. In this blog we’ll take a daily look at new implications of Moore’s Law in real time, as it rolls forward to create our future.
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February 15, 2005

Facts Are Stubborn Things

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Posted by Dana Blankenhorn

The Copyright Police keep coming up against stubborn facts, some of their own making, that throw their arguments into the dumper.

Two are making headlines today.

First is a joint study by Harvard and University of North Carolina researchers indicating "Downloads have an effect on sales which is statistically
indistinguishable from zero." Felix Oberholzer (Harvard) and Koleman Strumpf (UNC) matched a set of downloads to record sales in coming to this conclusion. "Even in the most pessimistic specification, five thousand downloads are needed to displace a single album sale," they write.

The second piece of news comes from the industry itself.

It is, simply, the launch of Napster's "rental" service. For $15/month, you can download all you want. It all disappears when you stop paying, but the industry approved this business model, which estimates the actual value of unlimited downloads at $180/year. Spread that over 10 years, give Napster 15%, and you get an actual industry-estimated "loss" from unlimited downloading of $1,500. Not much.

This will make for some fun when I speak this weekend at the University of Virginia's VJOLT Symposium.


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