In what will surely be music to the ears of the major record labels, research firm NPD Group says that illegal file sharing of songs via peer-to-peer services has dramatically dropped off since Lime Wire shut down.
Lime Wire, the company that operated the popular peer-to-peer network LimeWire, was forced to shut down in October after a federal court found the company liable for copyright infringement. The Recording Industry Association of America had file a copyright suit against Lime Wire and CEO Mark Gorton in 2007, claiming the company encouraged the pirating of billions of songs.
NPD said today that in the wake of those events,"the percentage of Internet users who download music via peer-to-peer services was at 9 percent in the fourth quarter of 2010, compared to 16 percent in the same period earlier in 2007."
Here's more of what NPD found:
The average number of music files downloaded from P2P networks also declined from 35 tracks per person in Q4 2007 to just 18 tracks in Q4 2010, although some downloaded just one or two tracks, while others took hundreds. NPD estimates there were 16 million P2P users downloading music in Q4 2010, which is 12 million fewer than in Q4 2007.
NPD's research showed that LimeWire was the overwhelming leader when it came to downloading music through P2P. But the research also noted that it appears former LimeWire users are moving to similar networks.
Of those using P2P to download music, 56 percent chose to do it with LimeWire during the third quarter last year, NPD said. The number fell to 32 percent in the last quarter, which is the period when the company shuttered operations.
Frostwire was used by just 10 percent of those sharing music files via P2P in the third quarter of 2010. That number rose to 21 percent in the final quarter of 2010. Bittorrent client u-Torrent, meanwhile, edged up from 8 percent to 12 percent, NPD reported.
"Limewire was so popular for music file trading, and for so long, that its closure has had a powerful and immediate effect on the number of people downloading music files," said Russ Crupnick, entertainment industry analyst for NPD, in a statement.
"In the past," Crupnick continued, "we've noted that hard-core peer-to-peer users would quickly move to other Web sites that offered illegal music file sharing. It will be interesting to see if services like Frostwire and Bittorrent take up the slack left by Limewire."