Concludes illegal file-sharing hasn’t discouraged artistic production, with the number of new albums alone having doubled since 2000.
One of the entertainment industry’s favorite claims is that illegal file-sharing has discouraged people from producing new movies or albums, for example. It then argues society as a whole suffers as a result.
A new Harvard Business School study conducted by Felix Oberholzer-Gee and Koleman Strumpf contradicts this claim with a variety of gathered evidence.
“Consumer access to recordings has vastly improved since the advent of file-sharing,” it concludes. “Since 2000, the number of recordings produced has more than doubled. In our view, this makes it difficult to argue that weaker copyright protection (as a result from illegal file-sharing) has had a negative impact on artists’incentives to be creative.”
That’s right, doubled.
“While album sales have generally fallen since 2000, the number of albums being created has exploded,” it also notes. “In 2000, 35,516 albums were released. Seven years later, 79,695 albums (including 25,159 digital albums) were published (Nielsen SoundScan, 2008). Even if file-sharing were the reason that sales have fallen, the new technology does not appear to have exacted a toll on the quantity of music produced.”
Ouch. Illegal file-sharing hasn’t seemed to harm the incentives for artists to create, and it cites two reasons why this is likely the case.
The first is that as the price for music decreases, or even free for some, “consumer willingness-to-pay for complements increases.” People are more willing to buy a concert ticket or band merchandise, the price of both which may then rise to compensate for declining album revenue.
The second reason is the fact they’re artists. No one is suggesting that artists shouldn’t be fairly compensated for their work, but the researchers remind people that unlike other types of labor they are likely to enjoy what they do.
They see a similar trend in the movie industry.
“The worldwide number of feature films produced each year has increased from 3,807 in 2003 to 4,989 in 2007 (Screen Digest, 2004 and 2008). Countries where film piracy is rampant have typically increased production. This is true in South Korea (80 to 124), India (877 to 1164), and China (140 to 402). During this period, U.S. feature film production has increased from 459 feature films in 2003 to 590 in 2007 (MPAA, 2007).”
In fact, though it can’t be said of the music industry, the movie industry enjoyed another year of record profits last year.
What the authors investigate is the real impact that file-sharing and its resulting weakening of copyright protection mechanisms have had on the availability of creative content and its consumption in the marketplace.
“Over the past 200 years, most countries evolved their copyright regimes in one direction only: lawmakers repeatedly strengthened the legal protections of authors and publishers, raising prices for the general public and discouraging consumption.”
File-sharing has weakened copyright protections across the globe, disrupting the business models of virtually all of the creative content industries by forcing many of them to revise their pricing in order to survive, and therefore actually spurring consumption!
“While file sharing disrupted some traditional business models in the creative industries, foremost in music, in our reading of the evidence there is little to
suggest that the new technology has discouraged artistic production,” it furthers. “Weaker copyright protection, it seems, has benefited society.”
It also takes aim at the 1 illegal download equals 1 lost sale argument. In a sample of 5,600 people who were willing to share their iPod listening statistics, they found that an average of 64% of the songs on it had never been played, meaning it was probably free. I don’t think many people would buy music and then not even listen to it, the point being that just because it was illegally downloaded doesn’t necessarily mean it would have been purchased otherwise.
jared@zeropaid.com
Related
- Study: More Teens Not Buying CDs
- Digital copyright protection for mobile devices
- Shapiro Attacks RIAA Over Copyright Protection
- Argentina Extends Copyright “Protection” Term by 20yrs
- Copyright Office Upholds Copy-Protection Law
i love zeropaid so much more than torrentfreak, at least zeropaid moderates comments so RIAA trolls aren’t allowed to spew their hatred
we love you Zeropaid
Fantastic article. In order to get politicians to understand that stricter laws are not in the public interest, this kind of material is paramount! Keep it up!
If you had the time, you could maybe find more sources and studies of the same time, that puts numbers to what we all are saying – that filesharing is good, there are still lots of money to be made, falling IFPI member music revenue is not directly attributable to filesharing etc
“The second reason is the fact their artists.”
What about their artists? Or do you mean that they are (they’re) artists?
I don’t mean to be rude but making basic grammar mistakes do detract from articles.
It’s obviously “they’re”…sometimes spellcheck has a mind of it own.
Believe or Doubt?
Another excellent article! Studies such as this should be the basis of decision making in the industries, not speculation.
I suggest the wrong question is being asked here. Instead of asking whether file-sharing has affected the incentive of artists to create, the question should be whether it has affected the ability of artists to make a living from their creativity. Sure, file-sharing is a great book to, say, garage bands, who need the Internet to spread awareness of their music–until they get established and can attract a record contract. Sure, sometimes the greater exposure available through marketing on the Web can sell more tickets to concerts. But what about artists like, say, Steely Dan, who much preferred not to tour and to make all their music in the studio and make their living by selling albums? A comparable question can be asked in the domain of creativity I inhabit, book publishing. The Internet makes it possible for every author to self-publish, and as a result we have over 600,000 new books published every year in the U.S., a tenfold increase from pre-Internet days. Is that necessarily a good thing? The world is awash in trash, and it is harder than ever to find the real gems. In scholarly publishing, we may all eventually have to move to “open access” because of piracy. The alternative business model to pay the costs of publishing is to charge authors fees upfront, or their universities or foundations willing to support their work. Is that a good thing? Maybe so. And it is feasible in this domain because the costs can be paid in other ways. (And there are real costs to peer review, which is vital to publishing in this arena.) But I’m not sure if it is feasible in others.
Nice post. Something people often take for granted is that the internet is a great tool for promotion – and in some cases it is, but peer to peer itself is not designed for promotion. If you go to a search engine, you have to know who you want to find before you can download their stuff. So the promotion is the key, as it always was – bands starting out have to play in their hometown and build an audience on the ’scene’ there. If they are successful, they get backing and promotion in other areas and in all media including the internet. At that point a free download can serve as promotion, but having all your stuff on p2p networks doesn’t do anything excpet make it free to own. It’s just as easy to get whether one person seeds it or a thousand. It’s not promotion, it’s just distribution for free.
This same importance of promotion applies to the publishing business as well. Lots of people self publish. Not only is there a perception that the product is inferior, people that have done POD in the last fifteen years the tech has been common have found that promotio is not so easy. Some people in niche markets have found it beneficial – self help people, people who have seminars, people who teach classes, in other words, where the book is not the product itself, the person is. It hasn’t really worked for novelists.
“Something people often take for granted is that the internet is a great tool for promotion – and in some cases it is, but peer to peer itself is not designed for promotion.”
The Internet was not designed for performing commerce either, but it still has not prevented that type of utilization. It’s referred to as an unintended function.
“If you go to a search engine, you have to know who you want to find before you can download their stuff.”
One needs to decide what do find before searching for it at all.
“So the promotion is the key, as it always was – bands starting out have to play in their hometown and build an audience on the ’scene’ there.”
Fallacy. There exist people who detest their own hometown.
“If they are successful, they get backing and promotion in other areas and in all media including the internet. At that point a free download can serve as promotion, but having all your stuff on p2p networks doesn’t do anything excpet make it free to own.”
Ownership exclusively permits one or several to use and manipulate the owned item in any manner. P2P certainly does not duplicate that.
The other problem with your statement is the assumption that artists would place all of their works online. Certainly they would prefer to offer some of them exclusively as promotional bonuses instead.
“It’s just as easy to get whether one person seeds it or a thousand. It’s not promotion, it’s just distribution for free.”
That is quite idiotic of you to contradict your words like that. Why one would distribute for no gain without the intention to allow others to acknowledge the object’s existance is only wasteful.
“This same importance of promotion applies to the publishing business as well. Lots of people self publish. Not only is there a perception that the product is inferior, people that have done POD in the last fifteen years the tech has been common have found that promotio is not so easy. Some people in niche markets have found it beneficial – self help people, people who have seminars, people who teach classes, in other words, where the book is not the product itself, the person is. It hasn’t really worked for novelists.”
Again, one cannot expect to rely on a single thing to do to live.
*’Hometown’ should be ‘hometowns’.
“Some people in niche markets have found it beneficial – self help people, people who have seminars, people who teach classes, in other words, where the book is not the product itself, the person is. It hasn’t really worked for novelists.”
If I were you, I wouldn’t make that argument to Cory Doctorow. His means of promotion has always been basically, “Please spread!” and that has worked stunningly well. He’s a sci-fi novelist.
Cory is a nice man whose first book that he gave away happened to be about – you guessed it – how books ought to be free and copyright is a problem. A message like that has a built in audience, people who think copyright is a problem, and that’s tied in with his chosen means of distribution.
Cory has a complete package there that’s hard for other novelists to duplicate, maybe people who write about something else, or don’t want to be web journalists most of the time like Cory.
Cory has also said he feels that because books are what they are, they wont be replaced by free files the way music has. How nice for him, how lame for people who don’t write books, but make music or movies instead.
Because no one, no one in the music business has ‘made it’ by giving their stuff away for free.
“Because no one, no one in the music business has ‘made it’ by giving their stuff away for free.”
Especially Metallica way back in the day right before he became hugely popular I’m presuming.
People didnt make mp3’s in 1989.
Neither did they in 1981 nor before 1991 and now it’s 2009 (2009-1991=18)….
Anyway, apparently the root of your argument with “giving their stuff away for free” is that you really mean “giving [all] their stuff away for free”. Surely nobody would do that (or at least right away) if they were to gain something from it.
*Intending to gain something from it, that is (not necessarily money).
Whoops (noun-pronoun confusion).
“Surely nobody would do that (or at least right away) if they were to gain something from it.”
Should read
“Surely they wouldn’t do that (or at least right away) if they were intending to gain something from doing that (not necessarily money).”
Of course, the incentive of artists to create is a prerequisite to the conditions in the question you are asking. Now, even the artists associated with record labels might as much be not well known, so the recognition benefits to garage bands would also apply to those artists as well.
“But what about artists like, say, Steely Dan, who much preferred not to tour and to make all their music in the studio and make their living by selling albums?”
Because his work load is much less focused on live performance, he should be able to generate higher quality music. With good reputation, supposedly, file-sharing in general shouldn’t cause a disadvantage when earning income.
As for book publishing, the conditions are slightly different. For example, if the book is given good rating, then supposedly it would draw in more sales. Similar to the case where a couple of good songs are hidden many among bad songs. Obviously, the intended audience must be considered.
If the book is given proper promotion to the public, it should be able to be distinguished among the lesser ones. As well, people would usually prefer paper books over electronic ones, commonly for the health of eyes.
I don’t know much about the economics of scholarly publishing, but from my understanding of the content, academic research for example, file-sharing should have little direct impact on this.
“Sure, file-sharing is a great book to, say, garage bands, who need the Internet to spread awareness of their music–until they get established and can attract a record contract.”
Just to be clear though, not all artists want a record contract.
“But what about artists like, say, Steely Dan, who much preferred not to tour and to make all their music in the studio and make their living by selling albums?”
I think Jonathan Coulton did something like that. He ended up quitting his day job to persue music full time as a result.
“The Internet makes it possible for every author to self-publish, and as a result we have over 600,000 new books published every year in the U.S., a tenfold increase from pre-Internet days. Is that necessarily a good thing? The world is awash in trash, and it is harder than ever to find the real gems.”
There are a number of examples you can find where content creators became successful as a result of the internet (Sorry it’s not an author example, but a band by the name of OK-Go comes to mind)
I would argue the huge increase in content creation is fantastic and there is some great stuff out there. I remember a film director on the Space channel saying how he had drawers and drawers of DVD’s both good and bad. The reason it’s also important to be aware of what didn’t work as a movie is to find out why it’s something that didn’t work and learn from that mistake.
There’s a premise out there that if artists don’t make money, then they don’t create art. The record industry keeps going on and on about how file-sharing will kill the industry and no music will ever be made again. This study puts, yet, another nail in that coffin because the sharp increase in content production completely debunks that myth again. The creative industry has grown – some more than others – once there is the introduction of file-sharing and the internet.
True that the number of recordings out there have grown, but that has to do with cheap recording gear, not the internet. Where the internet has helped is in distribution – an artist can have his files downloaded from his site or from p2p for free or for a pittance have them hosted for sale somewhere (free on amazon, cheap on itunes). This has nothing to do with file sharing – as sharing files doesn’t help in distribution anymore than getting a link to the artists web site does. And sharing does nothing for promotion, except through music blogs and they could just as easily link to a website as host the files themselves. The study says file sharing has increased and the number of albums out there have increased but shows absolutely no causal link, becuase there is none.
The fact that sharing does nothing for promotion and that money is required for promotion, usually label money, is underscored by the fact that in the last ten years not a single band has gotten big by adopting the free software philosophy of Stallman and the EFF. Giving away a track or a record as a loss leader has done some good for a few bands that have gotten big by other means, however.
If you’re going to introduce an new argument, do it right; otherwise you are way too late for that.
“True that the number of recordings out there have grown, but that has to do with cheap recording gear, not the internet.”
But not a single elaboration given after this topic sentence.
“… becuase there is none.”
Clearly this study reads “since the advent of file-sharing,” which is a time period. Also, the correlation poses probable causal link and you have not yet proved this probability to be zero.
“… can have his files downloaded from his site or from p2p … nothing to do with file sharing … ”
P2P is a superset of file sharing, for crying out loud. Therefore the rest of the paragraph is annulled.
“The fact that sharing does nothing for promotion … money is required for promotion, usually label money, … by the fact that in the last ten years not a single band has gotten big by adopting the free software philosophy of Stallman and the EFF.”
All of this is retardant and ludicrously ignorant electronic diarrhea.
Your stupid text wall has nothing to do with replying to DrewWilson’s post.
As well, mal greenborg, this study focuses on copyright laws and statistics, in case you have not yet sensed that even after one week.
I don’t have to disprove a suppostion with no data or logoc to back it up. The ’study’ reads like old fascist propaganda – there is no causal link.
At first you were kind of interesting but now you are boring.
Impressive, mal greenborg, you’ve finally succeeded in looking at your own reflection for once!
As well, malgre, if you are no expert, then spare the trouble of criticizing a study done by actual experts that work in a renowned university.
Besides, with that worthless trash of an insult of yours, not even a miracle would help you in an argument with me.
I don’t want to argue with you, I want to discuss things and understand. You are kind of boring, becuase all you do is attack, but I’m optimistic enough to think I might be able to explain some things to you.
Such as: Those people are not experts. They are activists.
“I don’t want to argue with you”
Then don’t insist the things that you write to be factual.
“I want to discuss things and understand”
Discussion involves consideration or examination of something and you did nothing of the sort. Considering your reading comprehension, the way you understanding things is pitiful.
“You are kind of boring”
Talking to your reflection again?
“becuase all you do is attack”
Attack? No; making fun of you just seems too appropriate to do. I haven’t been taking you seriously enough to want to attack you. Perhaps your need to defend yourself is the root of that idea. Or is it the lack of respect from me that you feel attacked?
“but I’m optimistic enough to think I might be able to explain some things to you.”
And why do you suppose I would have an idiot to explain anything to me? I would say that you are stupid enough to think that, not optimistic enough.
“Such as: Those people are not experts. They are activists.”
Are you suggesting that people who study in business schools are activists now?
I thought you just wrote “I want to discuss things and understand” yet you are doing the opposite.
“the way you understanding things”
should read
“the way that you understand things”
you guys fail to acknowledge the fact that parallel to questioning the whole IP ownership arrangement, there are new patterns to content marketing too. the day of posters and trailers is long gone – enter web 2.0 as a means to combing to an ever increasing pool of content.
Amazon pioneered the “people who viewed/bought this, also viewed/bought that” as a powerful engine for consumer-driven market exploration. now there’s the social networking and file-sharing communities where one can actually track consumer behavior, preferences and feedback from trusted peers (more than often real-life acquaintances). a recommendation on a new movie or music album from someone with similar taste works far better for me compared to 20 sec. trailer, billboard or a magazine ad. same holds water for trusted blog reviews or other emerging media sources.
bottom line being that the current media marketing mix is obsolete, cost-ineffective, and also inhibiting when it comes to niche content items. and bear in mind that niche items are a huge share on the media shelves – less than 40% of amazon’s combined sales come from “bestsellers”. the remaining content is niche, not subject to mass-marketing, and comprises a “long-tail” that will represent a 50% revenue cut for Amazon if dropped.
The one download one lost sale is a complete fallacy. There are many many many people who download ‘because it is there’ but would never have spent money on the product. Not to justify it, but it’s truth.
I like how many people over the years try and pretend no one reads ZeroPaid. In this case, pretend that no one comments on here. You could always look at the numerous stories with several comments in them, but hey, pretending is so much easier, isn’t it?
Now run along and post under 50 different aliases on your favorite news site.