Monday, November 1, 2010

"The war on piracy is a failure." - Sean Parker

In a recent appeared on a panel at the Daily Beast's Innovators Summit recently, at which he proclaimed "you have to accept that the war on piracy is a failure." Just in case you don't know, Sean Parker is the founder of Napster, a website which "allowed people to easily share their mp3 files with other participants, bypassing the established market for such songs and thus leading to massive copyright violations of music and film media as well as other intellectual property." He knows a bit about piracy in the music industry.

Parker claimed that among all internet music downloads, 4 billion have been done legally, as opposed to 4 to 10 trillion illegally. Even Steve Jobs was quoted saying that "today’s most popular iPod holds 1000 songs, and research tells us that the average iPod is nearly full. This means that only 22 out of 1000 songs, or under 3% of the music on the average iPod, is purchased from the iTunes store." It's an established fact that almost all music downloading is done so illegally and that it will be extremely difficult to stop, or even slow down for that matter.

Parker has come up with a new way of downloading mp3s legally as he has launched Spotify. Its approach is to "allow unlimited streaming of music to a desktop, and to confine that music to the desktop device." Parker talks about this new system in this video:

Can Pirating Really Kill Music?

Pirating = Death of Music?

Maybe Not!
While some scattered few say piracy helps musicians, its hard to prove this, since we can't exactly look at a musician who has been stolen from a lot, and another who hasn't and compare them, because every musician is different. However, it is not hard to find sources that say piracy will be the death of music, they are everywhere! Kevin Maney in his USA Today article makes some interesting claims. He even makes a few claims that go along with the free distributing argument here made in this blog. He goes on to say that CD's because of pirates are only promotional tools, and artists must depend on merchandise/shows/endorsements to make money, he actually says that a model very similar to what we here have presented may be the music industry of the future, and there may be little to stop it - and believes will be the impending doom of the music industry. However, most of the aspects he is looking at in China are looked at negatively, with one of the closer sentences being ,"Thankfully, not everything about the Chinese music business is likely to come true in the USA." But the marketing scheme given in earlier posts is all about looking at the bright side, and implementing what things can still be taken advantage of, like merchandise and shows, while saying "If piracy is the future," like Kevin Maney suggests, "then we might as well take advantage of what little remaining variables we have." If piracy in the USA heads down the road China has, then there may not be much the music industry can do. Its time for those running the music business to look at what they can control, and take full advantage of that, instead of trying to fight the inevitable in vain. I disagree that piracy is the death of the music industry, it is just another aspect of human action that has yet to be accepted and taken advantage of. If we learn how to use free music distribution to the musicians needs, common grounds can be reached.

Like Norman Lebrecht claims, The Future of Music is Free. While it is uncertain how music will be free and music still thrives in the future, we believe there are many ways music can still be promoted while given out, our idea is just one of the few. It would be beneficial for musicians to start looking into the future of their own marketing system, as the ones who make the first successful moves will be seen as pioneers, and can be very successful if they create their own marketing scheme. We want musicians to be able to make a living while they create songs we enjoy, but to think they will continue to get paid the same way they did before file sharing is keeping your head in the past, which may put you behind.

A look into the future of the music industry: China

As pointed out in an earlier post, China's music industry is currently dominated by illegal downloading and copying, an industry in which artists rely on other sources of revenue such as merchandise and shows. Consumers value songs at next to nothing, and downloading tracks is exceedingly simple thanks to Chinese search engines such as and Yahoo! China. So how exactly have these factors affected Chinese musicians and the country's industry economically?

About 95% of music sales in China are pirated copies, and almost 100% of music downloaded in the country is done so illegally. As a result, Chinese musical artists earn next to nothing solely from album sales and rely on other forms of exposure. An example of these is large commercial shows performed by prominent Chinese acts. The BBC explains how artists "get paid a set amount by companies or promoters regardless of how many tickets they sell," in their article on China's music industry. The article goes on to state that these performances account for over half of Chinese pop stars' income.

So why should artists even attempt to sell music if most of their songs are stolen and the majority of their earnings come from other sources? The BBC article highlights the fact that while "US and Europe are still finding ways to counter piracy, Chinese record companies have already decided it is a lost cause, finding other ways to make money which are not directly related to music sales." This "lost cause" way of thinking about selling music is quickly becoming the broadly-accepted point of view globally. In Kevin Maney's article on, he points out the fact that "music pirating is so rampant and so entrenched in China that it's unlikely to ever be eradicated," and quotes the vice president of Global Catalyst Partners as saying that "there never will be [a legitimate music download service that charges for music in China]." This will soon most likely be a reality in many other countries, including the United States.