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April 20, 2010

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alastair harris

OR, piracy reduces the effectiveness of the top stars ability to exploit their monopoly supply position.

The counter argument is about property rights

Mike Woodhouse

Sumner vs Russell. I would suggest that many people would genuinely assert that the former is at least as well-endowed with innate ability as the latter. Me included, if I'm honest, and I'm no great fan of either. Apart from musical ability, one clearly has a significant talent for self-promotion and the other does not (or does not care to use it, which would be a waste).

But that's beside the point. The paper may be sound or it may be bollocks and is most likely somewhere in between. The reality is that the world has changed forever and the DEB is but a finger in the dyke as the entities with too much investment to change cling on (as they obviously would) to their income for as long as they can.

Long-term, better-adapted mechanisms will appear to replace the moribund ones and the world will move on. Short-term, it's the usual mess. In the meantime, I'm off to buy some TV21 tickets.

Prateekbuch

Piracy may well benefit record sales - or at the very least does not appear to hinder all that much - according to the music industry lobby the BPI. Their own figures show that sales of singles (digital and hard-copy) were at record levels last year...

record companies that railed against the DEB strike me as being in denial over the massive potential that online file-sharing has in terms of artist discovery - the 'market' created by file-sharing does the sorting-of-wheat-from-chaff for them and throws up web-phenomena that they could capitalise on, if only their business models were flexible enough!

John Terry's Mum

"At the margin this means that some people who would have bought the U2 album instead buy an one by a smaller band"

Strange assumption here; that the punter would have bought the U2 album, but for lack of marketing had to buy a lesser known alternative.

I doubt most people buy an pre-alloted amount of msuic per day, weeke, month etc.

Andrew Russell

If record companies can't make money from existing global superstars because of piracy, how are they better off investing in making new global superstars from unknowns? The incentive to pirate is unchanged.

chris

@ Andrew - they don't have to spend more marketing unknowns. Merely spending less marketing (say) U2 reduces the barriers to entry faced by unknowns - and this barrier to entry helps give the likes of U2 a monopoly position, as Alastair says.
@ JT's mum - I don't think the assumption is that strange. Sure, U2 fans will buy their albums whatever. But there are people who might only do so after widespread marketing, to see what the fuss is about. Less marketing means less spending by these. And although these won't all automatically buy another album, some will.

Kevin Carson

I think the fact that the proprietary content companies have to compete with Free really does benefit lesser-known artists, in all fields.

It's probably true that blockbuster artists like Stephen King, Lady Gaga, or whoever, have somewhat lower profits than they otherwise would thanks to file-sharing. But for every conventional artist in the stable of a big publishing house or record company who faces that situation, there's probably ten or a hundred people like me (or some garage musician) who can market their work directly over the Net for a few thousand extra dollars a year. People like us would probably never have found a conventional publisher twenty years ago, and would have spent our entire lives mute except for writing letters to the editor.

It's a lot harder for the big guys to make a huge pile of money, but it's a lot easier for a whole lot of little guys like me to make a nice little pile of money.

And at mid-range, I suspect that the reduced revenues from selling "Freemium" (i.e. excludable secondary services piggybacked on free content) and marketing one's work directly online, are offset to a considerable extent by the benefits of network culture in freeing them from reliance on the record companies' studios and marketing machines.

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