Sunday, January 9, 2011

Music Piracy = Less Sales - a myth?


There are multiple ways to obtain digital music online - legally and illegally. Some of the legal means are iTunes and Amazon. I will not tell you how to do it without paying some dollars (but I’m sure you already know how, right? Guilty!)

Some say online music piracy translates into multimillionaire losses to the industry, yet others claim it actually serves as the means to gain some reputation and fame to before-unknown artists and bands. There are studies which also argue that there is actually no direct relationship between piracy and the decline in music sales.

Felix Oberholzer-Gee and Koleman Strumpf performed a statistical study of sales of 680 albums over 17 continuous weeks and found that illegal music sharing actually increases sales – 150 downloads mean one more CD copy (original) sold. I guess that is too much. They also claim that the relationship between loss of sales and music piracy is not direct but that there are other causes. Additionally, they argue that “illegal file sharing would have accounted for only 2 milion fewer compact discs sales in 2002, whereas CD sales declined by 139 million units between 2000 and 2002.”

On a particular history note, Radiohead’s album "Kid A" leaked into Napster three months before it had to be released but yet it sold over 200,000 copies the first week and got onto No. 1 on the Billboard charts. Some say this means illegal downloading helps bands promote their albums. I think this was just pure coincidence, but who knows.

However, we still need to do something to reduce music piracy and get those sales back as profits. So only follow these instructions and you will be "safe". After you read the instructions, you will think “um, but how do I digitally watermark my songs?” Here is one of the multiple companies that do it: The PAN Network.

The RIAA and music companies must work together to develop and continuously improve technology to keep decreasing illegal downloading. I don’t think new legislation will do any good, since it cannot keep in pace with technology.