Do free downloads damage the music business and stop artists and record companies getting royalties on sales? Many of you are probably aware of the debate over so-called free mp3 files that sites such as Napster and mp3.com make available to visitors. In the US, companies have been sueing these sites for millions this past year. Ironically, the big 5 (Universal, BMG, Sony, EMI and Warners) have ended buying these companies for millions.
Interestingly, long before the advent of sites such as mp3.com, cd sales have been essentially flat for years. Yet in the past 12 months or so, in spite of the alleged damage done by free music sites, record sales have exploded.
If we take pirated software as a comparable example, the biggest pirates are corporations not individuals. In fact, people who use pirated software probably wouldn’t buy the application in the first place, it’s the allure of getting something for free which motivates them. So the supposedly ‘lost sales’ are simply wish fulfillment on the part of the software companies. I suspect it’s the same with music. I know I tend to download music I wouldn’t normally buy, largely because it’s such a hassle to go to the record store and listen the artist in question and because I have priorities about what I purchase.
Looked at realistically, until mp3 players are as common as portable cd or cassette players, most people prefer to buy CDs. They’re portable, they can be played pretty well anywhere and most people don’t have their PC hooked up to a decent sound system. Moreover, you have all the info on the artist packaged with the jewel case.
I can remember back to the days when tape cassettes got real popular. The music industry went through the same whinge about vinyls being copied and the subsequent lost sales. Yet research showed that the vast bulk of copying onto cassette was done by people of their own albums, who wanted to travel with their favourite music.
Perhaps more importantly is the issue often put forward by the record companies that it’s the artists who lose out. Yet who’s been ripping off musicians all these years? With major enetertainment companies controlling the marketing and distribution of music, artists have very little control over the percentage of the sales they get.
Okay, increasingly artists are starting to self-publish but aside from a few major artists, self-published music sells in very small numbers and tends to target niche markets musically speaking.
Another factor that comes into play is that as the media and communications industries consolidates through buyouts, erstwhile music companies now make money from connection and phone charges, let alone from sales of music.
Universal Music for example, just bought Napster for $57 million, a fraction of the damages they were claiming in their lawsuit. Industry insiders are saying that Universal didn’t want the case to come to court because allegations of royalty ripoffs by Universal would be exposed.
Yes, if everyone who downloaded a freebie off the net would have otherwise bought the CD, the record companies might have a case but they have no evidence to back this up at all. By and large, the Web has proved to be an excellent marketing and advertising medium for both the biggies and the individual artist and is more than likely why CD sales have jumped this past year. Could it be that the record companies are just plain greedy?
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