The Music Industry-- the Free Download Problem

By Diane Shubinsky


Americans are mad about baseball, so much so that the terminology used there has been extended to their legal system. The Three Strikes Law in the USA means any criminal who has been convicted three times or more receives a more serious punishment. This baseball phrase has been picked up by many other countries and in France it has been given a whole new application. There, the three strikes law is applied to electronic stealing (also known as electronic piracy) from the Internet in the form of illegal downloading and/or file-sharing those downloads with others. And anyone caught doing this three times or more will have their access to the Internet blocked.

The bill, which is also known as HADOPI, an acronym for the High Authority for Copyright Protection and Dissemination of Works on the Internet, is extremely controversial. The European Union (EU) has declared that access to the Internet is a fundamental human right and therefore this law is, paradoxically, illegal. But apart from all the legal wrangling that is taking place, there is an even greater irony. HADOPI brought out a new logo to make the public aware of what they were doing. Unfortunately they used a font that had been created by France Telecom exclusively for their use. In other words, they were guilty of electronic piracy! The fact that a government agency that was established to prevent this phenomenon inadvertently committed the crime they were fighting, demonstrates how problematic it is to control electronic theft - something that the music industry has discovered to its cost.

The avarice of the music industry has blinded it to the realities of a new age. DVDs are overpriced; they are just not value for money and hence people are not prepared to buy them. Why should they when almost everything is available for free. Steven Knopper's book, "Appetite for Self-Destruction: The Spectacular Crash of the Record Industry in the Digital Age" which came out in 2009, describes how the music industry refused to modernize. The web site, Napster, which was extremely successful in the years 1999-2001, exemplifies the outdated attitude of the music industry. Instead of bargaining with Napster, who had 26 million users, they sued them and managed to shut them down. This supposed success was short lived, since although they won that particular battle, their short sightedness meant they lost the war.

The introduction of the iPod in 2001, followed by MP3 players and the development of mobile phones to accommodate music files were the final nails in the coffin of the music industry. Dr. Michael Bull of Sussex University in Britain has done extensive research on the impact of the iPod. One of his discoveries is that most users spend their money on the actual equipment and download the music illegally. Knopper says he would like to see the music industry make downloading a better legal alternative so that the "free" route would become redundant and iTunes supports his claim. In a Newsweek interview in 2006, Steve Jobs explained that "if you want to stop piracy, the way to stop it is by competing with it, by offering a better product at a fair price. In essence, we [Apple, who owns iTunes] would make a deal with people. If they would pay a fair price, we would give them a better product and they would stop being pirates."

At present the music industry is unhappy. This is hardly surprising since their sales went down from approximately $14 billion in 2000 to a mere $10 billion in 2008. Yet many of the musicians are not suffering from the same decline in fortune. Many artists upload their material onto sites like MySpace Music and a their fans will happily pay $10 to legally download the music, in the understanding that the artists too have to make a living. And perhaps this is the root of the problem: the musicians and fans have found a way to communicate directly and cut out the record labels, the ones who in the past really made the money.

Basically, until the music industry learns how to become a successful business entity in this new electronic era, it is doomed. It cannot play the same old tunes to a new melody, and as long as it persists in trying to do so, it will find itself bypassed. Beethoven was the hit musician of his times and although he is still enjoyed by millions worldwide, no one would expect to find him in the top ten, certainly no one from the music industry. So how come an industry that has always appeared so innovative in moving to new styles - from Bach to blues, jazz to rap, pop to rock - is not prepared to change its business model?




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