File sharing doesn't dampen Eminem's sales

Sunday, June 2, 2002

LOS ANGELES -- Eminem's record label was so nervous about music pirates cannibalizing sales of the rapper's latest CD that it released "The Eminem Show" nine days early, disrupting well-laid marketing plans.

But when the CD hit stores Memorial Day weekend, it still managed to debut at No. 1 in record time.

Some industry observers say the CD's success in the face of widespread bootlegging proves that online music swapping doesn't crush legitimate retail sales and can actually generate better buzz for a new release.

"The jury is still out on how significantly file sharing actually effects record label revenues," said Michael Goodman, a senior music analyst with Forrester Research in Boston. "But to a certain extent, file sharing can actually prime the pump for sales."

SoundScan, which gathers sales data from more than 17,000 retailers across the United States, said 284,534 copies of "The Eminem Show" were sold nationally during the long weekend.

"We've never had a record debut at No. 1 on the SoundScan chart that hasn't had the benefit of a full six days of sales behind it," said Mike Shalett, chief executive of SoundScan.

Success on Internet

But Interscope Geffen A&M, the label behind Eminem, insists that illegal copies, made from one of three closely guarded master copies sent to manufacturers, hurt the release.

"I absolutely believe that the bootlegs and downloads have a huge negative effect on sales," said Steve Berman, head of sales and marketing at Interscope, a division of Universal Music Group.

Individual songs from the CD became widely available online in mid-May, and bootlegged copies of the entire CD began appearing on street corners around the same time.

It's impossible to calculate how many sales were lost in the process, Berman said.

Interscope took a number of steps to counter the impact of the downloads, beyond moving up the release date.

Two million copies of "The Eminem Show" were shipped with a complimentary DVD that featured interviews with Eminem.

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