Blank tape purchases (in units) 238.4 million 178.8 million Displaced purchases, retail value 68.7 million (Merchandising) (2) X (3) 1.875 X (4) (5) X $6.56 per album 1981 ESTIMATE OF LOSS DUE TO HOME TAPING: EXECUTIVE SUMMARY A recent Warner Communications Inc. (WCI) report on home taping showed that in 1980 the market value of home taped music and other professional entertainment exceeded $2.85 billion. Further, the report concluded that, were home taping not possible, tapers would have spent at least an additional $600 million on prerecorded product. The present report uses the tapers' own perspective to develop an additional measure of the extent to which home taping replaces the purchase of prerecorded product. Sample As part of its ongoing panel research, WCI conducts an annual "Home Entertainment Survey." This survey was included in the November 1981 diary, which was mailed to a select panel of U.S. households. The panel is maintained by Mail Diary Panel, Cranford, New Jersey. The survey was completed by 3,264 respondents age 10 and older. Replacement Questions All respondents were asked whether they had taped any music or professional entertainment in the past 12 months. Those responding "yes" then indicated whether they would have purchased the last album and/or selection they taped if they could not have made a taped copy. Key Findings 40% of those taping complete albums report they would have bought the album had they been unable to tape it. 35% of those taping selections report they would have purchased the selection or the album containing it had they been unable to tape it. Other Findings There is not one replacement value; tapers' reports of their likelihood of buying had they been unable to tape vary greatly depending upon their demographic characteristics and various aspects of their taping behavior. Thus, the overall replacement values given above represent weighted averages across all possible sources (e.g., broadcast performances, own or borrowed records), reasons for taping, and types of music taped. Note The above replacement values are based on mail panel respondents' answers to hypothetical questions. The report not only considers the limitations of using a mail panel and the difficulties involved in asking respondents to make hypothetical judgments, but it also describes how we have attempted to resolve these problems. Conclusion Despite the above limitations, we believe that the data obtained in the present study provide reasonable and reliable estimates of replacement from the tapers' own perspectives. More specifically, the tapers themselves report that 4 out of every 10 taped albums and 3.5 out of every 10 taped selections replace purchases of prerecorded product. 1981 ESTIMATE OF LOSS DUE TO HOME TAPING: The recent WCI report on home taping (see M. Fishbein, S. Middlestadt and M. Kapp, "A Consumer Survey: Home Taping" WCI, March 1982) provided evidence that in 1980 the market value of home taped music and other professional entertainment exceeded $2.85 billion. Although the report recognized that every album or selection that is copied is not a "lost sale," it took the position that "[a]ll copying infringes upon the lawful and legitimate rights of the copyright owners." More specifically, the report pointed out that, "[e]very time a complete album or selection is taped, the taper is reproducing a copywritten work in its entirety without providing fair and equitable compensation to the copyright owners." Moreover, the report clearly indicated that taping replaces sales of prerecorded product. For example, when asked to give their reasons for taping, 45% of the current music tapers reported they had made at least one recording so they "didn't have to buy" the prerecorded product. Not only was this the most frequent reason given, but 25% said this was the reason they taped most often. The report further pointed out that consumers spent over $600 million on blank tapes to bring this $2.85 billion worth of music into their homes. It was argued |