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Positive effects of Music piracy on the Music Industry
Quick Links:
Positive Effects
Examples of how free downloading has benefitted artists
Conclusion and Possible Ideas for the Future
Access to older music no longer in print
Because of the way contracts are constructed, artists don’t own their own
music–record labels do. So when artists that change labels, their new label is
not allowed to produce the albums the artist made on the old label, and if the
old label decides not to print anymore albums or release the songs, the music is
effectively dead. Music downloading is the only way for most people to access
these “dead” songs
Creates devout music fans
Most music downloaders are teens that both have the time it takes to download
mass amounts of music, and who also don’t have the money needed to buy albums.
However, music downloading does create a love of music, that will carry over
when teens become adults. And when that happens, they don’t have the time to
download the same amount of music, as well as having the money to buy albums
with, thereby increasing album sales in the long term.
Experimentation with artists Greater Musical Diversity, greater record
sales for lesser kown artists, greater concert attendance
81.87% of the entire music industry was controlled by 4 record companies,
Universal Music Group, Sony BMG Music Entertainment, EMI Group, and Warner Music
Group in 2005 according to Neilson SoundScan (see pie chart for detailed data from this report). These are the labels that have the money to
promote their artists through advertising, radio, and music videos.
But most artists aren’t signed to these labels, but smaller independent labels
that don’t have as much money as the major labels. As a result, most artists
don’t get any radio play, they don’t have ads, and their videos are of low
quality and are usually not shown on television. Music downloading is great for
lesser known artists to get the exposure they normally wouldn’t have. Most people
won’t buy music they haven’t listened to. Music Piracy allows downloaders to
experiment with unknown artists. This kind of experimentation cannot hurt the
industry, as downloaders would not have bought the music if downloads were not
available, but by downloading and having the music, they may either realize they
like the music, and buy the actual album or other albums by the same artist, or
spread the music to their friends, who then in turn might also buy the music, or
go to concerts. These smaller, independent (not signed to a major label)
artists have been on the rise the past several years, and are starting to take
some market share away from the major labels.
According to the RIAA, only 15% of albums make money. However, most record
label contracts require that all costs for making the album be returned to the
company, meaning that 85% of artists are actually in debt to their company after
the records are released. Most artists repay this debt through money gained
during concerts. And people who discover artists through piracy may like the
music enough to go to shows. As shown by by the 2005 RIAA Consumer Profile, cd sales at concerts have risen, implying that
there are more people attending concerts and/or more people attending these
concerts don’t already own these cd’s; both of which may be attributed to the
publicity gained due to online music downloading.
“Honest Retailers Lose”
A lot of retailers have gone out of business, but not because of internet
downloading. Many retailers can’t compete with the discounted prices or special
offers record companies give to large established companies such as Best Buy,
Walmart, Tower, and Target.
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Examples of how free downloading has benefited artists:
o
Radiohead-“Kid A”
oWhen Radiohead released their new
album on Oct. 3, 2000, it debuted at #1 on the Billboard charts, an album with
heavy electronic, ambient, and experimental jazz influence, nothing like any
album that had ever been #1. And all this was done without music videos,
interviews, radio play, or touring (the main sources of publicity for most big
artists). The publicity it gained before its release was through free online
downloads, particularly Napster. The record company decided to give out the
entire album online to radio stations and selected sites, and as a result, 3
months before the release date, all of Kid A was available for free for
all to download on Napster, where massive amounts people downloaded the album
for free. This is why the RIAA worked so hard to shut down Napster, because if
people have already downloaded an album, who would want to buy it? But despite
the heavy downloading, the album still sold 210,000 copies in its first week,
which suggests that downloading created enough publicity, and gave people a
chance to become accustomed to a type of music they had never before heard, to
make the album hugely successful, more then anyone could have possibly
imagined. For Radiohead, mass downloading took the place of mass radio play,
and made it a prime example of how free music actually increases sales.
o
Not music related, but it demonstrates the same idea of free music
downloading. The site offers books for free, and offers even more evidence on
how giving away works for free is profitable, and the homepage (which argues why
giving away books for free is good for authors) offers many parallels to music
downloading arguments, as well as offering more proof on how free distribution
led to increased sales.
o
Pre-Release Streams
o
Many artists, including well established artists from Madonna,
offer free streams and/or downloads of their new albums before they are
released. These artists are the ones that realize the positive potential of
free music.
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Conclusion and Possible Ideas for the Future
Effects of Music Downloading- Long term album sale increase, access and exposure of out of print music, greater influence of independent and other lesser known artists
The rise of lesser known artists may change the entire soundscape of the music
industry, as many of these artists don’t concentrate on making music they know
people will buy, but rather music they think is good. Most larger recording
companies will force an artist to create music they know will sell, by hiring
their own producer for an artist, or by not releasing the album until the artist has
complied with their wishes. However, smaller, lesser known labels generally let
their lesser known artists do as they please. And these lesser known artists are
the artists that experiment with new ideas, instruments, and song structure. And
if these artists continue to rise, they could have a profound influence on the
rest of the music industry.
What the music industry should try to be doing is to, instead of attacking piracy, should realize that the ideas behind piracy actually benefit the industry, and should embrace rather than shun the technology behind it. Instead of encrypting CD's, shutting down sites, or spend millions of dollars lobbying Congress, they should build a system where all music is easily accessible for free. Perhaps a RIAA owned mega-streaming site that streams, for free, every song of every artist, with easy links to online music stores if the consumer likes the music enough to buy it. This will not only be a cheap, quick, inexpensive way to promote artists, but will also harness all the aforementioned positive effects of free music downloads.
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