How and why do audiences download music?
How are record labels tackling the issue of filesharing?
What new business models are being developed by music companies to cope with this?
Context
I am researching this topic as it will broaden my knowledge on the music industry, music distribution and audience consumption. By carrying out this investigation I will be able to discover how p2p and file sharing sites such as Limewire function and how they are able to cause such a negative impact on the music industry. I will also learn where, when and why file sharing suddenly became a problem and why it is a crime. It will be interesting to learn what demographic mainly uses file sharing and why they do, this will enlighten me on what flaws there are in the marketing and distribution of music that leads audiences to look to illegal options to consume their music, and how this has become so popular. Primary research will help me discover which demographic file sharing is most popular with and why this is, this will further help me understand in the marketing and distribution of music.
From this investigation I will be able to conclude what has gone so wrong with the music industry’s approach to their audience that has caused the file sharing problem in the first place. At this point I will research what the music industry is now doing to resolve the problems of file sharing.
Arguments/Findings/Conclusions
Secondary Research
Internet Research
From my internet research I have probably found the most information, especially from the BBC news website which has contributed greatly.
Firstly I wanted to find out what precisely makes file sharing illegal. And it turns out that file sharing is legal, but only when copyrighted content is shared is it then illegal. When someone is not sure whether a file is legal or illegal to share it is easiest to think if the song is a popular song that can be bought online or instore, if it is found in shops such as HMV or iTunes then it is going to be copyrighted. P2P sites such as Limewire have made it possible for anybody to share files to other people across the world. The fact that file sharing is now so easily accessible to anybody is the reason illegal file sharing has become such a problem for the music industry.
In 2006 it was reported that the level of file sharing had remained the same for two years despite 20,000 legal cases in 17 countries. This shows that the problem is being contained and the fact that file sharing isn’t increasing is something to celebrate. Another thing to celebrate is the fact that legal downloads were worth £570m in 2005 which is up from £214m in 2004 and the figures are still growing. This shows that more people are using the legal option but John Kennedy from The International Federation of the Phonographic Industries stated “The industry is finding it difficult to persuade existing song-swappers to use legal downlo
ad services such as iTunes instead. Those who’ve got into the habit of consuming their music for free are very difficult to shift”. And at this point in 2006 illegal downloads were exceeding legal ones by a ratio of three to one.Why do people turn to file sharing?
A survey conducted by Napster found that people are struggling to fill their digital music players. Most were only just over half filled and 66% of the music on those players were ripped from CDs. Ripping CDs is time consuming and people want to find quicker easier ways of filling up their digital music players. This is where people turn to file sharing where they can get mp3 files quickly at no cost. Therefore Napster has offered an alternative. They are promoting their subscription service where users can pay a set monthly fee for unlimited downloads. The only limitation is that if the subscription is cancelled the user can no longer access their digital music files. HMV and Virgin also have their own digital subscription services.
Primary Research
Questionnaires
These are the questionnaires i created for 20 participants to fill out. The 16-25 age group were all asked in school during a free where everybody was relaxed and had time to think about the questionnaire and fill it in appropriately, this led to all the 16-25 demographic containing the most qualitative information, whereas all other age groups were asked to fill out their questionnaires whilst at work, this led to very brief answers that contained little if any information, almost all of the questions that weren't yes/no questions were left blank, this means that i couldn't gather much qualitative information at all from these demographics. This makes the questionnaire unreliable, in order to strengthen the viability of the method all should have been answered with the same situational factors surrounding the participants, it can be hard though to get a large willing group of people of all ages in the same room.
I asked these questions so I could try to understand more clearly why people turn to file sharing and how much knowledge people have on it. From the questionnaires I collected some interesting data. For instance...
This chart clearly shows that the younger demographic purchases music online a lot more than the older demographic. The logical reason for this would be that the 16-35 demographic have grown up with the internet and modern technology and are therefore much more comfortable with it; also the 36+ would be more interested in older music that may not be so easy to come across online. This is just a theory though and if this theory was correct then it would make sense that the 16-25 demographic would purchase music online more than instore. There may be a range of reasons for this such as digital quality is a lot less than the sound quality found on CDs, or the demographic like the aesthetic advantage of having a CD where they get all the added extras including the cover art and the inside booklet etc. Another reason could be that they want to support the artists by paying for their music. Or, like me they don't have a credit or debit card that they can use to pay for their music on the internet. It would be interesting to carry out some further research with this demographic to find out the real reason for purchasing instore more than online. 
It is clear from these results that the younger demographic are much more aware when it comes to music and the internet, 100% of the 16-25's have heard of Limewire and 80% of the 6-35's know also. Whereas only 30% of 36-45s knew what it was and nobody above 46 had ever heard of Limewire even though it is the most used software for P2P and file sharing.
The results to this question are exactly the same as the results to the previous, except for the age 26-35s where the results have reversed, this shows that not many people actually know about file sharing above the 16-25 demographic, this leads to the conclusion that since the younger demographic understand and are well informed on file sharing that they are the ones most likely to be using sites such as Limewire and they are the demographic that are most contributing to the problem of illegal file sharing.
It is almost unanimous throughout the age groups that they find music a luxury and that they would purchase more music if it was cheaper. This makes it quite clear that music is too highly priced in the consumers eyes, this therefore leads to being one of the main factors contributing to the problem of illegal file sharing. And on the questionnaire above the 16-25 year old wrote that they agree with file sharing because it saves them money. 20% of 36-45s said music isn't too expensive; this may be because at this point in someone's career they would be on a good salary and can afford to purchase music without worrying about costs, but this is just an idea and I can't back this up because barely anybody filled in their occupation on the questionnaires.
This chart clearly shows that the younger demographic purchases music online a lot more than the older demographic. The logical reason for this would be that the 16-35 demographic have grown up with the internet and modern technology and are therefore much more comfortable with it; also the 36+ would be more interested in older music that may not be so easy to come across online. This is just a theory though and if this theory was correct then it would make sense that the 16-25 demographic would purchase music online more than instore. There may be a range of reasons for this such as digital quality is a lot less than the sound quality found on CDs, or the demographic like the aesthetic advantage of having a CD where they get all the added extras including the cover art and the inside booklet etc. Another reason could be that they want to support the artists by paying for their music. Or, like me they don't have a credit or debit card that they can use to pay for their music on the internet. It would be interesting to carry out some further research with this demographic to find out the real reason for purchasing instore more than online. It is clear from these results that the younger demographic are much more aware when it comes to music and the internet, 100% of the 16-25's have heard of Limewire and 80% of the 6-35's know also. Whereas only 30% of 36-45s knew what it was and nobody above 46 had ever heard of Limewire even though it is the most used software for P2P and file sharing.The results to this question are exactly the same as the results to the previous, except for the age 26-35s where the results have reversed, this shows that not many people actually know about file sharing above the 16-25 demographic, this leads to the conclusion that since the younger demographic understand and are well informed on file sharing that they are the ones most likely to be using sites such as Limewire and they are the demographic that are most contributing to the problem of illegal file sharing. It is almost unanimous throughout the age groups that they find music a luxury and that they would purchase more music if it was cheaper. This makes it quite clear that music is too highly priced in the consumers eyes, this therefore leads to being one of the main factors contributing to the problem of illegal file sharing. And on the questionnaire above the 16-25 year old wrote that they agree with file sharing because it saves them money. 20% of 36-45s said music isn't too expensive; this may be because at this point in someone's career they would be on a good salary and can afford to purchase music without worrying about costs, but this is just an idea and I can't back this up because barely anybody filled in their occupation on the questionnaires.Concluding the information discovered from the questionnaires it appears that the younger demographic ranging between 16 and 35 are the people that are most likely to contribute to illegal file sharing. A few of the people in this demographic wrote in their questionnaires under the question asking their views on Limewire and its approach to sharing music files that they agreed with the idea in the way that it saves money, but they did show that they knew that it was affecting the music industry and that they could get caught. One answer was "Good as music for free but can understand why illegal and bad for music industry."
It would be interesting to look deeper into the reasons for 16-35s turning to illegal file sharing for their music; I could carry out a qualitative interview with a group of people within the demographic to find out why.
Internet Research
What is being done to tackle illegal file sharing?One of the most successful ways of preventing file sharing so far has been the introduction of DRM (digital rights management) which restricts the free use and transfer of digital content, for instance iTunes has incorporated DRM into its music files so that it can limit the number of devices each song can be played on, it can also be used to limit the amount of times it can be added to a playlist, burned onto a CD and which digital music players can play it. DRM has caused controversy though as people argue that it does little to prevent piracy but instead limits what consumers fairly should be able to do with their music.
Other than DRM there have been few successful proposals to preventing file sharing as so many meet the problem of breaching fundamental human rights.
The most recent proposal was published on August 25th 2009 where the minister of Digital Britain, Stephen Timms suggested a “swifter and more flexible measures” to tackling file sharing as opposed to previous proposals such as restricting users’ broadband speed. He proposed to tackles illegal file sharing by temporarily suspending an individual’s internet account or blocking access to download sites. This way Ofcom has the flexibility to respond quickly to deal with unlawful file sharing.
The Government is also considering giving power to ministers to direct Ofcom t
o introduce technical measures to clamp down on piracy. This would obligate ISPs (internet service providers such as AOL, Tiscali etc.) to take action against repeat infringers. Also as a last resort against “the hardcore of copyright pirates” the Government are considering account suspension.
If this proposal does go ahead then Timms says that costs of things such as operating costs for sending out notifications and Ofcom’s costs as the regulator should be covered by the ISPs and rights’ holders.
But this proposal, like many in the past is causing split views as it threatens peoples human rights as any evidence used to identify offenders is unreliable as the introduction of wi-fi and multi-users per account has made it possible for wifi-hijacking therefore resulting in innocent victims of the hijacking being cut off from their broadband
.
Sony BMG tried to take the problem of piracy and file sharing into its own hands by introducing an anti-piracy software program to their CDs that not only limits the copying of music onto discs but also uses a virus-like technique to hide files on users’ systems and prevent them from removing the software. This causes an uproar with users vowing to never buy Sony BMG products again as they were essentially hacking into peoples computers with the potential to control their computer systems.
There has been no successful way of stopping pirates as of yet, but the introduction of sites such as Spotify are preventing people from turning to file sharing. Spotify describes itself as “an unparalleled user experience and a compelling legal alternative to piracy”. It has had nothing but positive reviews. The site is the first to have managed to get all the major record companies on board, meaning it has the largest range of music to legally listen to wherever and whenever you lik
e. It allows members to create their own playlists of songs streamed to them online. They use the same P2P technology found in file sharing. It is also accessible on mobiles to premium members; this means the music can be listened to in the same way an mp3 player works, basically disguarding the entire point of an mp3 player. Here is a Youtube video describing how Spotify works, and a link to an interview with the creator of Spotify Daniel Ek.
What is being done to tackle illegal file sharing?One of the most successful ways of preventing file sharing so far has been the introduction of DRM (digital rights management) which restricts the free use and transfer of digital content, for instance iTunes has incorporated DRM into its music files so that it can limit the number of devices each song can be played on, it can also be used to limit the amount of times it can be added to a playlist, burned onto a CD and which digital music players can play it. DRM has caused controversy though as people argue that it does little to prevent piracy but instead limits what consumers fairly should be able to do with their music.
Other than DRM there have been few successful proposals to preventing file sharing as so many meet the problem of breaching fundamental human rights.
The most recent proposal was published on August 25th 2009 where the minister of Digital Britain, Stephen Timms suggested a “swifter and more flexible measures” to tackling file sharing as opposed to previous proposals such as restricting users’ broadband speed. He proposed to tackles illegal file sharing by temporarily suspending an individual’s internet account or blocking access to download sites. This way Ofcom has the flexibility to respond quickly to deal with unlawful file sharing.
The Government is also considering giving power to ministers to direct Ofcom t
o introduce technical measures to clamp down on piracy. This would obligate ISPs (internet service providers such as AOL, Tiscali etc.) to take action against repeat infringers. Also as a last resort against “the hardcore of copyright pirates” the Government are considering account suspension.If this proposal does go ahead then Timms says that costs of things such as operating costs for sending out notifications and Ofcom’s costs as the regulator should be covered by the ISPs and rights’ holders.
But this proposal, like many in the past is causing split views as it threatens peoples human rights as any evidence used to identify offenders is unreliable as the introduction of wi-fi and multi-users per account has made it possible for wifi-hijacking therefore resulting in innocent victims of the hijacking being cut off from their broadband
.Sony BMG tried to take the problem of piracy and file sharing into its own hands by introducing an anti-piracy software program to their CDs that not only limits the copying of music onto discs but also uses a virus-like technique to hide files on users’ systems and prevent them from removing the software. This causes an uproar with users vowing to never buy Sony BMG products again as they were essentially hacking into peoples computers with the potential to control their computer systems.
There has been no successful way of stopping pirates as of yet, but the introduction of sites such as Spotify are preventing people from turning to file sharing. Spotify describes itself as “an unparalleled user experience and a compelling legal alternative to piracy”. It has had nothing but positive reviews. The site is the first to have managed to get all the major record companies on board, meaning it has the largest range of music to legally listen to wherever and whenever you lik
e. It allows members to create their own playlists of songs streamed to them online. They use the same P2P technology found in file sharing. It is also accessible on mobiles to premium members; this means the music can be listened to in the same way an mp3 player works, basically disguarding the entire point of an mp3 player. Here is a Youtube video describing how Spotify works, and a link to an interview with the creator of Spotify Daniel Ek.This is a video explaining what Spotify is all about
This is a print screen of some of the comments left under the Youtube video describing Spotify and how it works. This is living proof that Spotify, even though its only a few months old, is already converting music pirated into legal music consumers. One comment on there by a user names AndrewsAwesome said: "People who used to pirate music who I know are moving to this. As an iTunes user I love it. I am new to spotify you hardly notice the ads and am going to use spotify as my music client".
The interview with Daniel Ek, creator of Spotify: http://news.bbc.co.uk/1/hi/programmes/click_online/8072786.stm
The irony of all these techniques being employed to prevent illegal file sharers is that they are the ones that are always going to find a way around it and the innocent purchasers of music are going to be the ones getting punished. The music industry needs to come up with an entirely different, miraculously innovative model that is going to change that, but will there ever be? As technologies are always changing the pirates are forever changing their ways of getting around these technologies.
The biggest breakthroughs in beating piracy and newest successful models so far are:
- A recent landmark court case saw the men behind The Pirate Bay sentenced to a year in jail after being found guilty of breaking copyright law.
- They were ordered to pay $4.5m (£3m) in damages.
- While file-sharing site Kazaa agreed to pay $100m (£53m) in damages to the record industry following a series of high-profile legal battles. The peer-to-peer network has now become a legal music download service.
- Napster has also launched the world's largest online music store offering tracks from all of the major record labels and independents.
- But artists too are experimenting with innovative business models by offering their music free of charge online and making money from touring instead.
- In 2007, Radiohead allowed fans to pay what they thought the band's album In Rainbows was worth for a limited time.
- While Groove Armada fans were able to receive the first track of their EP for free, with the offer of additional tracks the more songs they shared.
With my music video I need to take into account the reasons why people turn to file sharing, because ultimately the song I am promoting is just as much at risk as anybody else's, the best way for me to try to prevent this is to create an innovative CD pack that has such aesthetic strengths that it is almost like a collectors item, this way people will want to buy the song so that they get all the added value that comes with it.
Bibiliography
Bibiliography
- Is filesharing legal or illegal? http://www.computerhope.com/issues.ch001042.htm
- Filesharing ‘not cut by courts’ http://news.bbc.co.uk/go/pr/fr/-/1/hi/entertainment/4627368.stm
- Digital Music: Industry Answers http://news.bbc.co.uk/go/pr/fr/-/1/hi/entertainment/4641054.stm
- New tune for digital music in 2006 http://news.bbc.co.uk/go/pr/fr/-/1/hi/technology/4549036.stm
- Study of Sony anti-piracy software triggers uproar http://www.washingtonpost.com/wp-dyn/content/article/2005/11/02/AR2005110202362.html
- What is DRM? http://www.wisegeek.com/what-is-drm.htm
- Measures unveiled to tackle illegal file-sharing http://www.24dash.com/news/Central_Government/2009-08-25-Measures-unveiled-to-tackle-illegal-file-sharing
- Tiscali UK Survey Reveals Illegal File Sharing Attitudes http://www.ispreview.co.uk/news/EkFVulFEAVbPsdkYcg.html
- Spotify http://www.spotify.com/
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