Music Industry Does Not Know the Words to Digital Music's Songs

Since shortly after the creation of the digital music format, MP3, increased Internet broadband access, and the rise of peer-to-peer networks for easy file distribution, we have seen new models of interaction amongst artists, industry, and consumers; however, it has also provoked controversy and animosity.

Initially slow to react to the trend of consumer swapping of music, the "Big Five" record companies (EMI, Universal, Sony, Time Warner and BMG) eventually banded together under their industry association, the Recording Industry Association of America (RIAA), to stop it, primarily through litigation. RIAA initially sued the first MP3 player manufacturer Diamond in 1998, but lost, thus paving the way for the ubiquitous iPod. They then sued MP3 distribution website Napster (1999), Aimster (2002), LimeWire (2006), and several Internet radio stations. Most controversially, they have sued thousands of individuals who downloaded music, including parents of children and deceased people. These lawsuits, however, caused negative publicity for the industry and have been ineffectual in stopping piracy; as Lam and Tan note, “Lawsuits are ephemeral and serve only as a delay tactic for record labels to catch up with emerging technologies. While the issue of contention in lawsuits is often the protection of copyright materials, the real concern for record labels may be the ceding of monopoly power” (2001, p. 68).

While the desire to get free music is no doubt a motivation, some downloaders feel this is a victimless crime and that music industry has a reputation for being greedy and artificially inflating prices. This reputation is not unfounded as Easley, Michel, & Devaraj found that the industry fought digital music due to a perceived threat of lower profits, as a "key economic issue for the recording industry is that the marginal cost of e-distribution of music is negligible, creating intense competitive pressure on prices and established distribution channels" (2003, p.92). MP3 is a universal, open standard, thus preventing proprietary products and corresponding price protection afforded, as McCourt and Burkart add "MP3 developed outside of the Big Five’s control, and offered no intrinsic protections against copying. MP3s therefore threatened the music industry by holding out the possibility of a business model that links artists directly to consumers, bypassing the record companies completely" (2003, p.336).

While RIAA's main efforts to combat this change appears to be litigation, they have also funded public education campaigns. On their website, they use strong language to convince downloaders of the harm to artists that their actions cause:

It's commonly known as piracy, but it’s a too benign term that doesn’t even begin to adequately describe the toll that music theft takes on the many artists, songwriters, musicians, record label employees and others whose hard work and great talent make music possible (Piracy, n.d.).

This appeal that the RIAA is fighting digital piracy to protect artists, spurred recording artist Courtney Love to write a column for Salon, in it she shows the copyright law engineered by the industry gives ownership to the companies, and the creative accounting companies use enables them to keep a large portion of the profits (Love, 2000). She asserts, "How dare they [RIAA] behave in such a horrified manner in regards to copyright law when their entire industry is based on piracy?" (Love, 2000). Love argues that the Internet can offer a great medium for artists to connect creatively and financially with their fans:

Being the gatekeeper was the most profitable place to be, but now we're in a world half without gates. The Internet allows artists to communicate directly with their audiences; we don't have to depend solely on an inefficient system where the record company promotes our records to radio, press or retail and then sits back and hopes fans find out about our music.... The present system keeps artists from finding an audience because it has too many artificial scarcities: limited radio promotion, limited bin space in stores and a limited number of spots on the record company roster. The digital world has no scarcities. There are countless ways to reach an audience. (Love, 2000)

This article was widely circulated, but the message of the dubious copyright laws is also gaining popularity amongst Internet users due to other prominent issues such as remixing, Digital Rights Management, etc., such that RIAA's appeal under this ground may be unsuccessful.

Further complicating this issue is the huge popularity of legal music download sites, such as iTunes, Amazon, Wal-mart, Real, Yahoo Music, etc. in which flat rate downloads per song are flourishing seemingly beyond the power of the industry for price control or to package songs primarily as an album, and thus make more money. In addition, the lowering cost of at-home recording equipment combined with the phenomenal success of websites such as MySpace are enabling musical artists to build direct relationships with their fans completely without any involvement of the recording industry.

RIAA and its constituent organizations seem unable to create a new digital music model or to stop piracy. Their communication strategy appears to be reactive and largely ineffective. The world is singing a new tune, but apparently those in RIAA don't know the words.

References

Easley, R. F., Michel, J. G., & Devaraj, S. (2003). The Mp3 open standard and the music industry's response to internet piracy. Communications of the ACM, 46 (11), 90-96.

Lam, C. K. M., & Tan, B. C. Y. (2001). The Internet is changing the music industry. Communications of the ACM, 44(8), 62-68.

Love, C. (2000). Courtney love does the math. Salon. Retrieved August 14, 2008, from http://archive.salon.com/tech/feature/2000/06/14/love/print.html

McCourt, T. (2003). When creators, corporations and consumers collide: Napster and the development of on-line music distribution. Media Culture and Society, 25, 333-350.

Piracy: Online and on the street. (n.d.). Retrieved August 15, 2008, from http://www.riaa.com/physicalpiracy.php