Monday, November 26, 2007

Does piracy in fact kill music?

Anders and myself started to argue about this in another thread, but I think it's more than important enough to warrant it's own thread. In fact, this topic was recently covered by Scott Adams, and can be found here.

I think his post is right to the point, so I'll use some of it to start off the discussion. Here is a summary of Adams' post:


  • For successful musical artists, file sharing does little in terms of increased publicity, since they are already famous, but hurts their record sales.
  • Many citizens happily adopt a pay-per-song policy, but many, many more would rather not pay at all.
  • Proponents of file sharing argue that for the not-so-well-known artists, file sharing can be leveraged to promote a career in music without necessitating backing from a record company, because the publicity leads to more asses in seats for live performances.
  • How many concerts have you attended over the last year because you heard an artist's music for free over the internet?
  • How many concerts by artists who got famous the old-fashioned way have you attended the last year.

What really irks me is the flimsy rationalization from file-sharing proponents, like a) "we're only taking a small fraction of the already too large profit of big music corporations", or b)"bands like Metallica are just greedy bastards who make way too much money anyways." For a) you have to be an absolute imbecile to be unable to connect the dots between a financial backer, artist revenue and the ability to keep releasing records using high-quality equipment. For b) it ain't up to you to decide whether or not an artist or a record company is making too much money. Especially seeing as how you in fact have no idea what the financial situation of said enterprises is to begin with. But for almost everyone, there exists a subsection of the population who feels that you make too much money.

Please don't be that guy (or gal) who tries to justify downloading/file sharing with moronic logic such as "I don't feel that file sharing is a crime, because I don't want to subsidise Big Corporations who push out a million identical artists but refuse to back True Individuals." At least have the cojones or whatever to admit that you're stealing stuff - don't make it into a Holy Crusade for All that is Righteous. Speeding is also a crime, but most would admit that they do it without throwing a Christ complex into the discussion. Don't even try to tell me that filesharing is noble - just man up to what you're doing. If you make a copy of your own CD and play it in the car, or you rip your CD collection for personal use, and if you put mp3s of your entire CD collection on a hub with 1000 users, we're talking about two quite different things - if you don't see this as separate issues (also in accordance with Norwegian law, actually), then don't even bother.

Some other facts/arguments that might be brought to light in this discussion, but which are typically drowned by strong partisan reasoning: You can identify at least three separate economies for artists based on their size/fame. The primary variables in these economies are CD/DVD/download sales, merch sales, and live performance revenue. Note that these variables are interrelated, so seeing them as separate doesn't make sense. Merchandise and CDs get moved at concerts, etc.

  • The well-established artists on major labels, with large fan bases. These artists make a lot of money on both front and back end of CD sales, but lose money/pray to break even on live performances if viewed separately. This is mainly due to the fact that if Rolling Stones go on tour, they bring along 2500 yes-people, 150 trucks, 30 sound engineers, 250 stage hands and roadies, 10 managers, 15 drug dealers, 50 guitar and drum techs, 17 yoga masters, etc. Payroll expenses alone kill the profits for the sheer live performance on big tours. They DO however generate lots of publicity and move merch and CD/DVDs from touring.
  • Medium-sized artists with a record deal could be in the zone where they're between markets, and so a few thousand CDs not sold could make the difference for whether they're able to make a living from music. This could probably go either way, though.
  • Minor players, especially those without a record deal, can totally benefit from "free" advertising on NRK Urørt" and general file-sharing, as they don't make any money from CD sale. Recording and distributing is freakin' expensive, and so CD's and downloads are used to propel touring/gigging as their source of revenue. A small band bringing along like two people can make an ok living from touring, but there's no way they'll move enouch CD units to justify upscale recording/producing/distributing costs.

Three separate economies based on the size of the bands - and my feeling is that a LOT of artists are in the middle bracket. I know that this is the case for many, many metal artists, who probably won't be able to live off of music if the CD sale goes further down.

10 comments:

Pigeon said...

I don't contest the point that dowloading has nefact effects for the record business but some facts have to not be forget.

-When the tapes recorders arrived in the late 70's the record companies proclaimed that it was the end of the business since copying was possible. It didn't happen.

-Those record companies forget to mention that they earn money for every hard drive and empty CD, DVD sold since those products are overtaxed to compensate the downloading problem. Which means that even if you don't download you have to pay anyway...

-The companies propose legal dowloading of these products. Great idea except that they sell it at the same price than the CD version. You're fucking kidding me ????

I precise that I buy my CDs cause I love the object

Wilhelm said...

I'm not trying to make anything black and white here, there are obviously problems on both ends.

There's one MAJOR difference between the tape-sharing of he 70-80's and the filesharing, though: With each new generation of copying, the quality of the music was diminished during the tape-trading of yesteryear. With filesharing from a hub, this is a non-issue - you get CD quality from each generation of downloads. Also, the internet has made it much easier to increase the dimensions of sharing - no way some kid in the 80's traded tapes with 10 000 other snot-nosed freaks, like you can easily do today with a fraction of the effort. This compunds the problem.

The issue of passing on the cost of illegal activity to everybody is not exactly new. What do you think insurance companies do to maintain their profits in the face of many, many small insurance frauds? That's right - they increase the premiums all across the board. In a market-drive society, this is what happens, and is in no way, shape or form exclusive for the record industry.

You're probably right about downloads being overpriced, though.

Anders said...

So, let's crystalize out the main questions here:

1. Is it right to download piracy music?
2. Does the music suffer from the piracy download?

Me and W-boi agrees on point 1. No, it isn't right. And I might add, it doesn't really matter if it is from a large (e.g. Metallica/ Kiss/ Britney Spears), medium (e.g. Chris Whitley/ Corey Harris/ every metalband i W-boi's collection) or tiny (e.g. Anders Blues Band/ Willy J. Malmsteen/ whatever). You may argue that the major artists have more money then they'll ever be able to spend, but that doesn't make it any more legal in my opinion.

Point 2: Have the music suffered?
This is the interesting point here. Well, it is a fact music sales has gone down since the it became popular with file sharing. But you can't just use file sharing as an excuse for that without considering a couple of points:
- If a person downloads a track for free, it does not mean that this person would pay for that track if it wasn't available for free.
- We had a change in formate, from LP and cassette to CD. Many people bought their previously owned LPs and cassettes on CD when the artists released their back catalouge on the new formate. This more or less correlated with the begining of file sharing, hence, giving a "false" high sales figure to start with.
- Survey's also indicates that those people who do the most downloading, is the ones that buys most music. This might be changing with the new generation, because they are not used to the concept of an album. They are more into single songs/ tracks.

So, I'm not too sure what effect illegal downloading has on music sales as a whole. It is at least not as clear picture as the record industry (and some artists) would want us to believe.

However, I think the above effects will have different impacts on the three different artist groups (minor, medium or large). I did read a very good survey on this some time ago, and will have to dig that one up.

Then there is a question of technology. We agrees in point 1, which means that new technology does not justify stealing.

But, it does raise the question: What does the record industry do to adopt to this new technology? So far, it's been mostly sueing people and shutting down illegal servers. Well, I can understand that. But that's a really passive approche which will only increase the number of extreme people on the other side (i.e. all music should be free), which won't serve the cause in the long run.

But now the record companies has given us the possibility of buying downloads (legally). Whether or not they are too expensive, I don't know. The marked will sooner or later determine that anyway. But more important are these three issues
- When I can't play my download on any other device than the computer I downloaded it to, I'm pissed. Then I payed for something I can't use.
- Also, as the case with the Rainer release, they have limited the marked for the US public only. I can't see how that is going to stop piracy download.
- Quality. Yes, the MP3 is OKish quality for a cell phone or MP3 player, when I'm playing it on my stereo, I want higher quality.

This is way too long. I will continue later. More questions are: Who would we like to support, the artist or the record company? With all the cheap recording equipment and new distribution channels today has The Record Company as we know it today out live itself? And also, where do we draw the line between private use and commercial use, if any?

Lot's of spelling errors, but I can't be bother. I'm going home. ;-)

Anders said...

Just a little link. This is a presentation of copyright law expert and professor larry Lessing. This talk is about internet and the use of material, including, but not limited to, music. 18 minutes, but it's well worth it and really relevant to the topic:
http://www.ted.com/talks/view/id/187

Anders said...

So, being the only bad boy still blogging (at least at this hour), I thought I should add a link to the good Scott Adam which is relevant to this topic:
http://dilbertblog.typepad.com/the_dilbert_blog/2007/11/compulsive-gamb.html

On a more serious note, here is SAs follow up to the blog post initially linked to by W-boi's:
http://dilbertblog.typepad.com/the_dilbert_blog/2007/11/results-from-ye.html

- B-Boy Anders

Wilhelm said...

If a person downloads a track for free, it does not mean that this person would pay for that track if it wasn't available for free.

Seen as one person downloading one track - no. Seen over one whole hub with thousands of users and more songs - you betcha'

Many people bought their previously owned LPs and cassettes on CD when the artists released their back catalouge on the new formate. This more or less correlated with the begining of file sharing, hence, giving a "false" high sales figure to start with.

True. And oen might argue that any change in format might constitute a giant rip-off solely designed for the purpose of making the customers buying the same releases numerous times under the guise of providing a product with noticeable imprivements in quality. There are obvious examples of this sad fact - two obvious ones are: Laser disc and Blu-Ray.

They are more into single songs/ tracks.

Which is way cool as long as people are willing to buy for the product and the record business is willing to adapt to this new market segment. Neither appear to be the case.

So far, it's been mostly sueing people and shutting down illegal servers. Well, I can understand that. But that's a really passive approche which will only increase the number of extreme people on the other side (i.e. all music should be free), which won't serve the cause in the long run.

Tru, tru, but this segment consists of certifiable lunatics that, but for their diminutuve stature and lack of testicular fortitude - would loot stores using the same inane argument: Everything should be free, man. Give the power back to the people, man.

Who would we like to support, the artist or the record company? With all the cheap recording equipment and new distribution channels today has The Record Company as we know it today out live itself?

Ideally, both. At least in my opinion. Th artist because you appreciate his or her work, and the record company because if you've got any synergy upstairs, you can figure out that you need financial backing and inside know-how is necessary to develop an artist capable of being internationally competitive. Also, even though new recording equipment is da bomb, mixing etc. is a science, and the fact that - at least in metal - you can always hear what studio the record has been recorded and mixed at, speaks volumes to the importance this has for the sound.

Anders said...

Seen as one person downloading one track - no. Seen over one whole hub with thousands of users and more songs - you betcha'

We agree. The point is, often the record industry will set one downloaded track = one lost sale. That's not true. But as you said, among thousands of downloads, there are people who are willing to pay for the download.

Tru, tru, but this segment consists of certifiable lunatics that, but for their diminutuve stature and lack of testicular fortitude - would loot stores using the same inane argument: Everything should be free, man. Give the power back to the people, man.

Yes. And we don't want any more of those.

Re record company and artist:

I think we will see a growth in independant/ small label releases. And those would be releases of high quality.

Also, I don't think we still would see some studio productions, even if there isn't a record label behind the scene picking up the bills. There might be different ways of financing the whole thing.

I have more opinion on the label/ artist thing, and also on "free" music. But that's for later. Now it's nap time for big bad blogger boys like me.

Wilhelm said...

When I can't play my download on any other device than the computer I downloaded it to, I'm pissed. Then I payed for something I can't use.
- Also, as the case with the Rainer release, they have limited the marked for the US public only. I can't see how that is going to stop piracy download.
- Quality. Yes, the MP3 is OKish quality for a cell phone or MP3 player, when I'm playing it on my stereo, I want higher quality.


These are obviously valid points, and typical for markets which are in their infancy at best. Especially the fact that if you buy a CD, you can rip it and use it on your computer, etc., but if you buy a download, it's single-source. What the hell.......

Truth be told, though, my sentiment is that douches like DVD-Jon obviously would've been shacked up in a Montana cabin with automatic weapons and flyers in support of an armed overturning of the government. Again but for his lack of brawn.

What the hell kind of argument is that - I make a tool by which you can open encryptions so that whatever's protected can now be public property, 'cause everything should be free, man. That's the most bank robber-esque argument I've heard in a long time. If you have something I'm interested in and I have the capabilities to take said object, I should do it just because I can.

If there's any kind of karma at all, there are someone taking DVD-Jon's lunch money and locking him in a gym locker right now

Anders said...

The DVD-Jon case. Yes, I have some viewpoints on that:

- First of all, I don't like the industry to put on protection that won't allow me to play my legally bought copy of DVD (or music) on the device I want. SO I understand the reason for making a tool that cracks copyprotection.

- BUT: The DVD-Jon software just smelled piracy a loooooong way. I would guess that 95% of the use the software to distribute movies illegal.

Even so, the main thing that annoys me about the DVD-Jon software: He took credit for a software he didn't create. He just made a new design on a program other had developed. More userfriendly, but still the same program. That's theft. How would you feel if I took your research, changed the font in the header, pimped up the graphics and published it under my name? No es bueno!

You're welcome to take DVD-Jons lunch money any day. And give him wedgies...

Wilhelm said...

don't like the industry to put on protection that won't allow me to play my legally bought copy of DVD (or music) on the device I want. SO I understand the reason for making a tool that cracks copyprotection.

I sort of agree, but this is also the tool which makes filesharing more difficult, so I can understand why the record companies are in favor of it. On one hand, it limits personal use, which is bad. On the other hand, some idiots are ruining it for everybody (much like people who commit insurance fraud), which is also bad.