Does filesharing help or hinder musicians?

Leaving aside the extremely hard-line nature of Peter Mandelson’s proposals for a crackdown on illegal file sharing, there is a more fundamental question about what the impact of illegal file sharing really is on the music industry. To what extent does the distribution of songs this way take money away from sales and to what extent does it act as a free form of publicity, which triggers purchases and income from other streams such as concerts and merchandise?

Take this recent report from The Times:

Lily Allen condemned artists who have spoken out against the[Government’s] proposals.

Allen, in a lengthy posting on her blog, criticised “rich and successful artists” such as Ed O’Brien, of Radiohead, and Nick Mason, the Pink Floyd drummer, [who] told The Times that file-sharing had some beneficial effects for artists.

The pair, part of the Featured Artists Coalition, which opposes plans by Lord Mandelson, the Business Secretary, to temporarily disconnect those who repeatedly flout the law, said that the government plans would criminalise young people.

O’Brien said: “My generation grew up with the point of view that you pay for your music. Every generation has a different method. File-sharing is like a sampler, like taping your mate’s music. You go, ‘I like that, I’ll go and buy the album’. Or, ‘You know what, I’ll go and see them live’.

“What’s going on is a huge paradigm shift.”

So as a follow up to the clip with Nick Clegg’s views on the matter, here is one musician’s musical riposte to Lily Allen:

(You can also watch the clip on YouTube here.)

Hat-tip: Mark Evans

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  • Lets not forget that file sharing isn’t just an issue for musicians, it’s an issue for anyone producing digital content for any market. An unregulated free-for-all threatens the software, movie and videogame industries just as much as music, and many of the solutions being proposed simply can’t be applied to those other industries even if they are valid to some extent for musicians.

  • Andrew Suffield 3rd Oct '09 - 7:04pm

    As a guy I know likes to say, streaming is just downloading followed by deleting. It’s an irrelevant distinction. If you are “streaming”, then you are downloading.

    I don’t think it really matters whether filesharing helps or hinders sales. Sharing and copying are fundamental elements of our culture, and trying to ban them is illiberal, while trying to tax them proportionately is a money-wasting exercise since it costs more to monitor than the revenue generated (while also being a gratuitous invasion of privacy), and trying to force sharing behaviour into easily taxed patterns is just a more subtle form of banning.

    You might as well debate whether the police DNA and fingerprint databases help or hinder investigations – it doesn’t really matter, because the big issues with them are the cost and the intrusion on individual liberty. Much like file sharing, the actual effectiveness is quite small, but we should not become focussed on that detail.

  • “I don’t think it really matters whether filesharing helps or hinders sales…”

    Err, it matters a great deal to those producing the content that’s being stolen. Sorry, “shared”.

  • Andrew Suffield 3rd Oct '09 - 9:20pm

    Yes, people are breaking into your house and taking away all your precious content so that you can never sell it again. The thieves!

    Does anybody else remember how we got the exact same argument about the DNA database? “It’s important to the victims of crime!” The parallel is growing increasingly striking.

  • “Yes, people are breaking into your house and taking away all your precious content so that you can never sell it again. The thieves!

    OK genius, then riddle me this:

    I write software for a living. If that software is available for free on bittorrent then what incentive does the consumer have to pay for it?

    And if the answer to that is “no incentive”, then what incentive do I have to write any more software?

  • I’ve been buying much more music since I started downloading file-sharing tunes. It’s that simple.

  • “You can’t be liberal and think the worst of people.”

    Can you be liberal if you have more than a tenuous grip on reality?

  • Libdem Guru 4th Oct '09 - 7:14pm

    the artist has to get paid from the internet via subscription, advertising, sponsorship or a mix of business models.
    yes, promotion is part of it but people must pay something for ‘free usage’.

    the easiest way is just like skytv and to have a subscription charge added to the isp or mobile phone fee per month. then a system is set up so that a fair recompense is paid based on numbers of downloads.

    simple….the isp’s and mobile companies have shafted artists for 20 years now and it sucks

  • wow, just read this.. looks like the liberals are off on another planet with this issue. has the party got a policy about it or are these just opinions, becuase some of the things said seems pretty strange??? never realised liberal democrats were pro-filesharing, makes me wonder why the pirate party uk didn ‘t just join you guys! im an “inventor” of sorts and make money from licencing patents, so you wont be getting my vote next year with views like these, im a bit shocked because our MP told us on the doorstep that she didn’t support this kind of thing, so whats the parties position on it?

  • Sorry to join this thread so late. Just stumbled onto it, and it’s made a fascinating read.

    @Mark Pack, it’s really funny – I find myself telling people the same things you’re advocating here on these threads. However, there’s a rather crucial difference. I’m a marketeer, encouraging people who want to take risks, with ideas for connecting to their markets in novel ways. You, however, are representing a party, and able to influence policy. It simply isn’t your place to promote these ideas, as fun as they are, as the new norm. Your role is, I’m afraid, to support the existing industries as best you can. While it’s certainly true that musicians can explore alternative routes for self-promotion, to suggest that the entire culture of British musicians MUST do so is dangerously beyond your
    remit. You would, in effect, be asking the entire IP-generating industry to exist in a state of jeopardy, wrestling with a market dynamic that few understand well, and no-one yet understands fully. I admire your enthusiasm. Chaps like Anderson and Godin really do earn their crust by inspiring excitement and enthusiasm about the “new market dynamics”, but as someone who plans to influence policy, it behooves you to treat their ideas in context – and particularly in the context of those who you represent.

    I’ll freely concede I’ve repeated the same statement three times over in the paragraph above, but I feel it’s essential to drive the point home as to what your perspective is required to be. Also, for the sake of intellectual charity, please do concede to @Krz that he is not off-side in asking you to be more transparent in your choice of terminology. It costs you nothing, and will do wonders to help the layman to understand the point you are making.

    If you’ll allow me, I’d like to digress momentarily on the role that “Free” actually plays in modern marketing, since I feel the point is painfully crucial here. First we must partially except Venture Capital, which is naturally a risk-taking exercise. I say partially, since there WAS a bubble in which it was assumed that anything could be monetized. We are all, I hope, aware that this bubble burst a little while ago, and that doorway is now shut.

    In marketing: “In business, nothing is free, until monetization is guaranteed”. You’re certainly free to invest your time in attempting to collect eyeballs, and hope that you can later find some way to turn that reputation into cash; however, that can’t be called a business, since there’s no plan, no investment with related returns. In business, we have risk and return. We calculate risk, and evaluate the probable and possible returns. If you decide to give something away for free, you know exactly how you’re intending to generate revenue from that. If not, you’re not in business. You can have no expectation (here in the statistical sense, allowing the pun) of a return, without a concrete strategy.

    The random selection of successful ventures do not imply an industry.

    Now we’ve had a little walk through the implication and connotation of the premises you’ve been proposing, consider this question: What percentage of musicians have this insight or perspective on their art?

    As a further question, consider: Would you want musicians to have to have this insight or perspective, or would you prefer they concentrate on creative output?

    If you’re paying attention, you’ll see that the second question is what led naturally to the creation of the “music business” as it’s called today.

    Downloading is damaging the current incarnation of the music business, and, in turn, the artists. We run the risk that the artists – who are a great resource and a great asset to our country – will find their occupations untenable.

    Please do correct me if I’m wrong, but I believe that Southern Ireland offers tax breaks for artists.
    Suggesting that artists should divert their attentions to studying marketing doesn’t seem like a fair alternative.

    @Huw Dawson, I do admire your faith in people. Sadly, however, that’s not what’s in question here; this discussion concerns purchasing patterns, not human goodness. Sadly, ten years of software history demonstrates that “free” software is not a profitable exercise. People need incentives to donate. The customer, as she stands today, simply does not have the mindset that she should contribute to support development of further software. If that were the case, the FSF would be a profoundly wealthy organisation.

    @MBoy Cheers for you! If you were representative of the market, there would be no need for conversation.

  • @Mark Pack, sadly I can’t say it does apply the other way around.

    If you intend to be Liberal, you don’t get to dictate what business models people use.

    Conversely, if you had policy to support and encourage new models, without impeding those who don’t intend to change their business strategy on your whim, I would be extremely interested to study and discuss!

  • Mark Wright 5th Oct '09 - 10:10pm

    We are in the middle of a transition between business models. This transition was long overdue, and the old business model was well out of date. However, the old business model made a small number of people a vast amount of money (and quite a few people a bit of money), and as such it is unsurprisingly that the vested interests in the old business model are doing everything they can to try to save it and resist the tide. Large chunks of the media industry are now irrelevant, and it really isnt surprising that they dont like that.

    It’s important to remember that the only reason that you can buy tunes online for very small amounts of money is because of file-sharing. That is a simple fact. If Napster hadnt been invented, or a similar clone, we would still be paying £16 plus a decade of inflation for a CD of music. It is only the advent of filesharing that challenged and exposed the grotesque amount of excess profit that the media “industry” (not artists) was creaming off of the sale of music that has forced a change of any of that. Not so long ago, as little as 5% of the cost of a CD was going to the artist. Those days are over.

    However, we are not yet in the new business model – we are between models. We are in the period of anarchy between regimes; and yes it does hurt some people. It’s often unfortunate to be around during a time of revolution. However, what will come in the future will be much better than what was in the past, and we just need to hang in there until the new regime is fully born. Those who say that the current anarchy means we should go back to the old model are utterly wrong. Just as anarchy of revolution should not put people off trying to overthrow tyranny to find a better type of government, so this music anarchy shouldnt put people off the chance off a better music model.

    Dont be taken in by the sophistry of those who are desperately trying to protect the sprawling tentacles of their beloved beast. The model of the future will be hugely better for all artists, and is not far away now. Filesharing is a form of civil disobedience that is challenging the establishment and forcing change. When change is fully won, that disobedience must stop, and right-thinking people will argue such. Until that time, those who paint all file-sharers as common thieves are only making themselves vast numbers of young enemies – if they spent the same amount of effort working on the future business model we probably would have been there by now…

  • @Mark Wright in many ways, I agree with your perspective.

    I’d never propose we ‘return’ to the ‘old ways’; in fact I actively encourage people to pursue new models.
    Although it’s higher risk, the potential rewards are equally much greater.

    All I have to say on this is that we DON’T have the solution just yet.
    That being the case, it’s not the right of the Lib Dem party to obstruct current business; it’s the duty of the party to support business and indeed, to continue to do so when the new models become apparent.

  • Mark Wright 5th Oct '09 - 10:35pm

    DG, the question of whether politicians should ever encourage civil disobedience is a sensitive one. I’m not aware that any Lib Dem politician has ever said “Dont buy, just download”, and I wouldnt support that tactic either. However, I think several have publicly said that those who download are not “common thieves”, and I would support that.

    This is a wider moral question of course – Nick Clegg has said he will not comply with the future law on ID cards, as have several other MPs. We in the free world regularly encourage those under despotic regimes to break the law and protest for more freedoms. We even condone armed rebellion. The latter of course is now a criminal offence in the UK thanks to Blair’s wonderful Terrorism Act.

    You are right we dont have the solution yet, but “the industry” is still lashing out at its own potential customers, rather than working with them. The continued insistence on “region versioning” of DVDs and other such marketing rubbish like that is indication that if you give them an inch they will still take a mile. I fear some big players in the industry are their own worst enemy. Possibly the solution wont come until the old guard are retired off. I hope not, because that would take years, and artists deserve a workable model ASAP.

  • Please forgive me for rehashing an earlier point in greater detail; I feel it may have been lost.

    @Mark Pack, you may be right, and I’d dearly love for us to be on the same page with this. Please have a read and let me know!

    @Mark Wright, whilst I greatly endorse the sentiment of your postings, whereby you aim to support the artists (in this debate I side very strongly with @Krz’s idea that this country has a unique and wonderful resource of musicians and creatives), I fear that the language you use has imprecisions that lead to inappropriate generalisations. From that standpoint, I’d like to discuss where we are regarding “new models”.

    iTMS (iTunes Music Store) is a record store. It still charges around £7 for a record (compare with the average £12 in shops), although it has reduced the price of a single from around £2.50 to about £1.60. There’s nothing new in the iTMS model; the price control was driven by Rapaillian good sense (can’t charge as much if there’s nothing you can hold), but principally the fact that the store was effectively first to market (since it was integrated with iPod, which was and is market leader). The dominance of iTMS came from timing and integration, and the pricing was forced by that muscle.

    You can point to many similar examples of mp3 shops – Beatport, 7digital, etc, and there’s really nothing new at all. When you consider that “real” record shops will order obscure recordings on demand, you might take the perspective that Anderson’s long tail results from the immediacy of online stores, rather than anything else.

    Spotify gets misunderstood, and that’s certainly from the imprecision of language. Spotify is an internet radio station. It shares its model with radio stations the world over – either they’re subsidised, or they sell adverts.
    Of course, with Spotify, every user has their own radio station which takes requests. To understand how artists make money from radio, you need to understand the operating methods of the PRS. The PRS has been around for 95 years.

    To summarise, there’s still nothing resembling a “new” model.

    Artists have always tried to supplement their income by touring, but that’s simply not applicable in some cases. For instance, this country has, and needs, good songwriters. Good songwriters are not by any necessity, good performers. Nor ought we demand them to be.

    These “new internet things” integrate wholly with the “old ways”, and there’s really no hint nor clue as to what a new model might be. Some of us have a close eye on the matter, but none of the examples in common discussion are anywhere close to “new”. They’re the old, modernised and more convenient.

    Downloading hurts iTMS and Spotify directly.

    Insisting that artists adapt to the “new models”, in the absence of any sign of such ideas, and when it clearly ought not to be their primary focus, is wholly dangerous.

  • Mark Wright 6th Oct '09 - 11:44am

    I think the “new model” will be more than just a snazzy electronic distribution mechanism. The number of people going to festivals has rocketed in recent years, and fans increasingly want to see their musicians live – so there is money to be made there. While electronic distribution has – in theory – made life much easier for musicians to get their music “out there”, the fans of the future also demand that artists tour festivals and venues, which I admit makes life a bit harder for artists but ought to be fun to! Artists should probably also be less snobby about licensing their music for commercial use. Thus the “new model” is likely to be a multi-pronged way of making money.

    As an aside I think that some of the file-sharing criticism from small artists comes from a viewpoint that appears to say that the internet should have made it easier to get rich from music, and yet it is as difficult as ever to do so. The reality is that the ever greater number of people wanting to make it as musicians was always going to make it more difficult for individuals to break through. If artists thought that they could just record some music and then let the cash roll in they were always going to be disappointed.

  • What an absurd rant. Presumably “Krz” thinks that nobody makes anything in China where even the state openly flouts copyright law…

  • @MBoy name your top ten Chinese musicians. Sorry, no, I’m just being flippant. How does your comment actually relate to this discussion?

  • DG: My favourite Chinese artist is Sa Ding Ding – I recommend her muchly. My comment was a direct response to Krz’s “Nobody that makes anything would live in a country governed by people with your views on the security of their product”. It’s self-evidently true that lots of people who make stuff live in China.

2 Trackbacks

  • […] These views chime with the instincts of Nick Clegg when I asked him about this at the party’s Bournemouth Conference. He was hostile to the Government’s preferred route of disconnecting people from the internet and instead talked about the need to find alternative ways of allowing artists and authors to earn a living. This view has also been backed by some in the music industry. […]

  • […] These views chime with the instincts of Nick Clegg when I asked him about this at the party’s Bournemouth Conference. He was hostile to the Government’s preferred route of disconnecting people from the internet and instead talked about the need to find alternative ways of allowing artists and authors to earn a living. This view has also been backed by some in the music industry. […]

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