What brings us musical piracy
Hello,
the problem of piracy was raised not once or twice in the open spaces of Habr, and it just so happened that the topic of my dissertation was directly related to it. This article is an excerpt from a literary review of digital music piracy and the impact it has. The article will be divided into two parts: the first is a brief overview of the possible effects (negative and neutral) and the second is a positive effect, like new opportunities that piracy can bring.
* This article only deals with Digital Music Piracy.
')
Types of digital music piracy effects
The controversial nature of piracy was discussed long before this article. On the one hand, it harms the recording industry, on the other hand, it provides almost unlimited free access to cultural heritage. Thus, we approach the consideration of the impact of piracy. From the existing literature we can conclude about three possible scenarios:
- Piratsvo reduces sales and evil in general (Zentner, 2006);
- There is no connection or it is too weak between piracy and the music industry (Bhattacharjee et al., 2005);
- There are a number of papers claiming that free file sharing has a positive effect on music sales (Andersen and Frenz, 2008; Gopal and Bhattacharjee, 2006).
Well, let's consider each effect separately.
Negative effect
It can be argued that the music industry during the 90s was very successful. According to global music sales statistics for the years 1990-2003. (Zentner, 2006, p. 64) (chart 1) sales almost doubled from 24.1 billion in 1990 to 39.4 in 1996. It is important to note here that the difference, for example, between the global market and the US market is large, while As the global growth rate stopped in 1996, the US market confidently showed a positive trend until the end of 1999 (Figure 2).
Schedule 1:
Chart 2:
But as can be seen from chart 1, the global market could not get out of stagnation and in 2000 the trend changed to a sharply negative one. Even the emergence of official online digital music sales services could not save the situation, because this niche was occupied by free music exchange sites. Therefore, as it can be concluded from graphs 1 and 2, the transition from CD to a fully digital format occurred with very serious losses for the industry.
Zentner in his work “Measuring the Effects of File Sharing on Music Purchases” (2006) found that free music sharing reduces the possibility of acquiring it by 30%. He also notes that this music can be distributed to people who are not involved in illegal downloading and as a result influence their decision on the purchase.
As you can already conclude from the above, online music piracy is quite a serious effect on sales, it is important to note the need to consider the problem more thoroughly, because the consequences are much more dangerous than a decrease in profitability. This assumption is based on the work of Wallace (2012), in which he highlights the three most noticeable effects of musical piracy.
1. Piracy leads to underinvestment in new talents.
The author uses as an example the state of the Spanish recording industry. The increase in the number of people using illegal content has wiped out the efforts of the local music industry in supporting new talents. Everything is explained quite simply, such investments become unprofitable. When the global situation with music sales began to deteriorate, Spain was no exception. In the period from 2004-2009. sales of local performers fell by 65%. What led to a situation where the industry did not have enough money to invest in local talents. That, in turn, negatively affected the volume of “production” of local music and, as a result, the development of culture in general.
2. Fear of loss causes investors to avoid certain markets.
As an example, China was used and the current situation around intellectual property, which can be described as inadequate. One of the key problems is related to local legislation, which is aimed at fighting only those pirates who profit from illegal activities. This state of affairs clearly seems outdated. the largest file sharing services are free of charge for users. There is also a statistics that shows approximately only 1% of Chinese consumers pay for music. This gives a record for companies to think about the expediency of investments. Thus, the country is losing the opportunity to attract international investors who have invested in the development of a local culture and helped to find and grow new talents.
3. Piracy cuts jobs.
The decline in sales of all hit the US companies hardest, because they own about 45% of the market (Zentner, 2006). What happened in the US market !?
- As a consequence of global and local piracy, the US economy annually loses an average of 12.5 billion dollars
“As a result, about 71,060 jobs were destroyed, of which 26,860 are in the recording industry and related industries, and 44,200 in the other US industries involved.
- Because of the piracy, US workers received less than 2.7 billion dollars annually. Of which directly to the music industry accounted for 1.1 billion, and 1.6 for the rest.
- Well, the crown of all are the tax losses of the state, which amount to 422 million dollars annually.
(Siwek, 2007, p.1)
Although the data presented above relate to the period 2005–2006, it can be argued that the trend persisted in the flesh until 2011, when, according to the RIAA (RIAA Music Shipment Data, 2012), the decline in sales ended.
Weak or no effect of music. Piracy industry
In their work “The Effect of Digital Sharing Technologies on Music Markets” (Bhattacharjee et al, 2005), the authors set themselves the goal of finding out what impact the illegal music exchange has on the whole on the industry. The creators of the work used as a basis the concept of guaranteed survival in the charts when debuting. The importance of such a phenomenon as a debut position was examined in the work of Strobl and Tucker (2000). “Time spent in charts decreased by 42% after clearing data from other variables. However, on closer examination, it turned out that the albums that debuted at the top did not suffer much. Most of the albums went to less popular artists' albums (Bhattacharjee et al, 2005, p. 25). Thus, the authors have shown that piracy does not help "survival". Although there is no influence on top jobs, yet less popular works are in jeopardy.
This idea is also reflected in Hammond (2012). But here it is important to note that a study was conducted (Page and Garland, 2009) which revealed that:
1. The top 5% of popular music accounts for 80% of all downloads.
2. This same top 5% has 90% of all sales.
Those. it can be concluded that musical piracy has a rather weak effect on the industry as a whole.
Instead of conclusion
As an intermediate result, it can be noted that the number of works that support the idea of ​​otlichnuyu from "piracy - evil" is ten times less than those against piracy. What can be clearly seen even from this article. But “the world is not without good people,” and therefore there are those who are trying to look at the problem from different sides.
The next article will focus on the fact that piracy can have a positive impact on the music industry.
Thanks for attention!
PySy I would like to clarify the article. This paper reflects only 2 of 3 existing opinions on piracy. About the fact that piracy can be useful, there will be a separate article.
the problem of piracy was raised not once or twice in the open spaces of Habr, and it just so happened that the topic of my dissertation was directly related to it. This article is an excerpt from a literary review of digital music piracy and the impact it has. The article will be divided into two parts: the first is a brief overview of the possible effects (negative and neutral) and the second is a positive effect, like new opportunities that piracy can bring.
* This article only deals with Digital Music Piracy.
')
Types of digital music piracy effects
The controversial nature of piracy was discussed long before this article. On the one hand, it harms the recording industry, on the other hand, it provides almost unlimited free access to cultural heritage. Thus, we approach the consideration of the impact of piracy. From the existing literature we can conclude about three possible scenarios:
- Piratsvo reduces sales and evil in general (Zentner, 2006);
- There is no connection or it is too weak between piracy and the music industry (Bhattacharjee et al., 2005);
- There are a number of papers claiming that free file sharing has a positive effect on music sales (Andersen and Frenz, 2008; Gopal and Bhattacharjee, 2006).
Well, let's consider each effect separately.
Negative effect
It can be argued that the music industry during the 90s was very successful. According to global music sales statistics for the years 1990-2003. (Zentner, 2006, p. 64) (chart 1) sales almost doubled from 24.1 billion in 1990 to 39.4 in 1996. It is important to note here that the difference, for example, between the global market and the US market is large, while As the global growth rate stopped in 1996, the US market confidently showed a positive trend until the end of 1999 (Figure 2).
Schedule 1:
Chart 2:
But as can be seen from chart 1, the global market could not get out of stagnation and in 2000 the trend changed to a sharply negative one. Even the emergence of official online digital music sales services could not save the situation, because this niche was occupied by free music exchange sites. Therefore, as it can be concluded from graphs 1 and 2, the transition from CD to a fully digital format occurred with very serious losses for the industry.
Zentner in his work “Measuring the Effects of File Sharing on Music Purchases” (2006) found that free music sharing reduces the possibility of acquiring it by 30%. He also notes that this music can be distributed to people who are not involved in illegal downloading and as a result influence their decision on the purchase.
As you can already conclude from the above, online music piracy is quite a serious effect on sales, it is important to note the need to consider the problem more thoroughly, because the consequences are much more dangerous than a decrease in profitability. This assumption is based on the work of Wallace (2012), in which he highlights the three most noticeable effects of musical piracy.
1. Piracy leads to underinvestment in new talents.
The author uses as an example the state of the Spanish recording industry. The increase in the number of people using illegal content has wiped out the efforts of the local music industry in supporting new talents. Everything is explained quite simply, such investments become unprofitable. When the global situation with music sales began to deteriorate, Spain was no exception. In the period from 2004-2009. sales of local performers fell by 65%. What led to a situation where the industry did not have enough money to invest in local talents. That, in turn, negatively affected the volume of “production” of local music and, as a result, the development of culture in general.
2. Fear of loss causes investors to avoid certain markets.
As an example, China was used and the current situation around intellectual property, which can be described as inadequate. One of the key problems is related to local legislation, which is aimed at fighting only those pirates who profit from illegal activities. This state of affairs clearly seems outdated. the largest file sharing services are free of charge for users. There is also a statistics that shows approximately only 1% of Chinese consumers pay for music. This gives a record for companies to think about the expediency of investments. Thus, the country is losing the opportunity to attract international investors who have invested in the development of a local culture and helped to find and grow new talents.
3. Piracy cuts jobs.
The decline in sales of all hit the US companies hardest, because they own about 45% of the market (Zentner, 2006). What happened in the US market !?
- As a consequence of global and local piracy, the US economy annually loses an average of 12.5 billion dollars
“As a result, about 71,060 jobs were destroyed, of which 26,860 are in the recording industry and related industries, and 44,200 in the other US industries involved.
- Because of the piracy, US workers received less than 2.7 billion dollars annually. Of which directly to the music industry accounted for 1.1 billion, and 1.6 for the rest.
- Well, the crown of all are the tax losses of the state, which amount to 422 million dollars annually.
(Siwek, 2007, p.1)
Although the data presented above relate to the period 2005–2006, it can be argued that the trend persisted in the flesh until 2011, when, according to the RIAA (RIAA Music Shipment Data, 2012), the decline in sales ended.
Weak or no effect of music. Piracy industry
In their work “The Effect of Digital Sharing Technologies on Music Markets” (Bhattacharjee et al, 2005), the authors set themselves the goal of finding out what impact the illegal music exchange has on the whole on the industry. The creators of the work used as a basis the concept of guaranteed survival in the charts when debuting. The importance of such a phenomenon as a debut position was examined in the work of Strobl and Tucker (2000). “Time spent in charts decreased by 42% after clearing data from other variables. However, on closer examination, it turned out that the albums that debuted at the top did not suffer much. Most of the albums went to less popular artists' albums (Bhattacharjee et al, 2005, p. 25). Thus, the authors have shown that piracy does not help "survival". Although there is no influence on top jobs, yet less popular works are in jeopardy.
This idea is also reflected in Hammond (2012). But here it is important to note that a study was conducted (Page and Garland, 2009) which revealed that:
1. The top 5% of popular music accounts for 80% of all downloads.
2. This same top 5% has 90% of all sales.
Those. it can be concluded that musical piracy has a rather weak effect on the industry as a whole.
Instead of conclusion
As an intermediate result, it can be noted that the number of works that support the idea of ​​otlichnuyu from "piracy - evil" is ten times less than those against piracy. What can be clearly seen even from this article. But “the world is not without good people,” and therefore there are those who are trying to look at the problem from different sides.
The next article will focus on the fact that piracy can have a positive impact on the music industry.
Thanks for attention!
PySy I would like to clarify the article. This paper reflects only 2 of 3 existing opinions on piracy. About the fact that piracy can be useful, there will be a separate article.
Source: https://habr.com/ru/post/184408/
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