Chicago (IL) - The British Music Rights published a new study on digital music usage trends that sheds new light on piracy issues. You would expect once again scary numbers of how many music files have been downloaded and how damaging the digital music age is for the music industry. However, this study actually found that music publishers and artists should be very upbeat on current trends and the fact that young adults are willing to put a "considerable value" on music, if the right service is offered. Music industry, are you listening?
By now, we are used to surveys and research estimating the potential impact of the legal and illegal digital music distribution models in place today. Every new research draws quite some attention, since there is always an expectation of news how much music is pirated. The claim of piracy creates tension and traditionally has sparked heated discussions between the music industry and consumers. This time it may be different, as the findings published of the British Music Rights do not reflect the typical result of this type of survey.
Most importantly, the British Music Rights, which hired the University Of Hertfordshire to conduct the survey, claims that young adults (ages 18 - 24, average age 22) are actually willing to pay for music if they’re offered an attractive service model.
According to the survey, which ended as the largest UK academic survey of its kind, MP3 players are no ubiquitous, with almost 90% of respondents stating that they own some sort of digital music playback device, such as an iPod, mobile phones, car stereos or game consoles. The typical MP3 player holds 1770 music tracks. Statistically, 885 of those have not been paid for.
P2P and friends are now the primary source of music
Widespread broadband internet access and the convenience of digital downloads have contributed to an enormous amount of music now being illegally copied from peer-to-peer networks. 63% of respondents are downloading their music from P2P file-sharing networks and 42% allow or have allowed other P2P users to download music from their computer. Another popular way of getting the latest music is by copying it from a friend’s hard drive (58%) or some other way (95%). Researchers have concluded that "much of this behavior is viewed as altruistic."
More than half of the respondents either download their music from P2P networks or copy it from their friends, indicating that music copied from P2P networks further spreads among friends. However, not all hope is lost for the music industry as an astonishing 60% said they continue to buy CDs. The CD isn’t quite dead yet.
80% of respondents who admitted to illegally file-sharing said they are prepared to engage with a legal file-sharing service and place a "considerable monetary value on it." The survey also found that young adults place different values on music formats. The least valuable version is streaming music and the CD the most valuable. Digital music files came in "somewhere in the middle." 60% of the total music budget is being spent on live music.
Feargal Sharkey, chief executive officer of British Music Rights said that "the music industry should draw great optimism from this groundbreaking survey. First and foremost, it is quite clear that this young and tech-savvy demographic is as crazy about and engaged with music as any previous generation. Contrary to popular belief, they are also prepared to pay for it too. But only if offered the services they want. That message comes through loud and clear."
Read on the next Page: Music industry caught dozing, RapidShare is the new Napster
Music industry caught dozing
The iTunes Store, Apple’s five years-old digital-only music store, has been reported to have sold more music in the U.S. than Wal-Mart who sells both physical CDs and digital download - at least in one month. The service sold over four billion music tracks since its inception and so far, no other download store has been able to break iTunes’ dominance. With physical CD sales declining each year, it seems to be just a question of time when the physical format will be extinct in favor of digital downloads. While the music industry is doing everything it can to stay relevant and protect its distribution channels, publishers have no convincing replacement service on their own.
Digital distribution makes it easy to get music from the P2P networks with a few mouse clicks, or plugging a USB flash drive in your friend’s computer to copy music tracks. And even if this basic behavior has been around for decades - remember LPs and tapes? - the convenience of copying music in the digital age spooked music executives who initiated lawsuits against end users. These lawsuits and negative advertising had some effect, but this strategy can’t hide the fact that the music industry has not yet found the key to solve the problem of music mass piracy. Many are still waiting for a service that is convincing enough to pull music pirates away from illegal download services.
And while the music industry fought a relentless war against Napster and other file-sharing networks in the past years, a new piracy problem appears to be more apparent every day: The new generation of file-sharing networks may prove to be much harder to crack.
RapidShare is the new Napster
Although most illegal P2P services are closed down, more than 50% of teenagers still download music illegally. So, where does this music come from? There are still plenty of download services available, especially one that largely has been operating under the radar of music executives - RapidShare. This membership based file-sharing network has quickly grown into a place where users post almost any conceivable premium content that can be distributed digitally, from music and movies to software, electronic books and image files of the latest videogames. Yes, RapidShare exchange their own content as well and RapidShare deletes a substantial amount of content that has been determined as being illegal, but it is hard to deny just how much copyrighted material is available on RapidShare.
Why doesn’t the industry simply shut down RapidShare? There have been limited efforts to do so, but the law does not seem to be clear cut in this case and legal proceedings take time. Also, RapidShare takes advantage of a similar loop hole that makes YouTube possible, although millions of copyrighted videos are distributed on the service every day. Under the DMCA, content creators and owners are required to alert a service owner, such as YouTube, Blogger or RapidShare to remove copyrighted content in a relatively time consuming process. The sheer amount of videos shared each day implies that it is virtually impossible to spot everything that has been posted right away. This scenario prompted media conglomerate Viacom to threaten Google with a billion dollar lawsuit, which Google answered with a video fingerprinting technology for automatic detection of copyrighted content.
Trends towards legal file sharing
In the meantime, the University Of Hertfordshire researchers say that music industry should meet the survey with great enthusiasm, explaining that cash spent on live music exceeds cash spent on recorded music.
"Technology has greatly increased the value of these activities - but it is clear that the financial gains are not necessarily feeding back to the creators: artists, composers and songwriters," he said. "How the music industry repositions itself here, and builds new mutually-beneficial commercial partnerships with technology providers remains the key challenge ahead," Sharkey said.
Sharkey warned the impression of people not willing to pay for music may be wrong. Instead, he suggests that a wrong approach pursued by the music industry has a substantial impact on the behavior of young adults - and not necessarily the one the music industry would want. The right service for a new generation of music buyers in fact may be the most efficient tool to battle music piracy in the end.