I am choosing to share my essay I have written about file-sharing to raise awareness of the benefits of file-sharing. Please send this to as many people as you can. Sorry if it's a little hard to read or if there are any mistakes.
I’ll Just Download It
Brian Zisk, co-founder of the Future of Music Coalition, said that “what we find, historically, is that the folks who do best are those who embrace the new technologies” (qtd. in McLeod 524). Zisk is referring to independent bands sharing music over the Internet. Musicians and bands are being heard by millions of users around the world because people can download songs for free. The musicians are using this new technology—the Internet—as a means of promoting themselves. Record labels, on the other hand, are not excited about the Internet because they lose money with every song that is downloaded. File sharing has been the subject of debate for the last few years and has been considered illegal by the Supreme Court. Users, however, continue to steal songs and their music libraries are growing larger with copyrighted music. Illegal file sharing is destroying the Record Label’s command of the music industry, while on the other hand, it is increasing the independent artists’ fan bases, revenues, and the number of independent musicians.
Record labels have created a monopoly in the music industry. Major labels including Sony Music, Virgin Records, Universal Music Group, and more account for the $15 billion recording industry and have a firm grasp on their bands and musicians. The labels are in a binding contract with their bands, so bands must comply with the company’s decisions. Dave Marsh, former editor for rock magazines Cream and Rolling Stone, has written a dozen books on the music industry. When asked what he thinks about the major record labels, Marsh claims that they “get you on breakage fees, they charge you extra money to make CDs even though CDs are cheaper to produce than cassettes…they just got a million scams to take money away from the artist” (qtd. in McLeod 522-3). Mainstream record labels are in the business for one reason—to make money. The labels’ profits are so high because they are responsible for approximately 90% of all legal music that is distributed (Imfeld 292). The firm grip that record companies have on the market makes it ideal for bands to sign with major labels.
With a solid grasp on the consumer market, the recording industry can easily transform our culture however they please. “[I]n the late 1980’s, the major labels instituted an industry-wide return policy that forced retailers to stop carrying LPs” (McLeod 525-6). The policy, in conjunction with the debut of the Compact Disc, made CDs the industry standard for music distribution. “[Compact Discs] generated higher profits and new sales as fans began replacing their vinyl collections with CDs at inflated prices” (McLeod 526). Fans were forced to switch their music collections to CDs since LPs were no longer available in stores. As CDs became more popular and widely used, “production expenses fell, consumer prices rose, and artist royalty rates stayed the same” (McLeod 526). With no other competition, companies were earning more money than ever, while the musicians’ royalties remained fixed. The high prices went unnoticed until “a U.S. court found the nation’s largest labels guilty of a conspiracy to drive up CD prices” (McLeod 526). The lawsuit did not stop the companies’ effort to increase sales. Today, the major labels bring in billions of dollars each year in music sales and have not had any serious competitors, except for one: the Internet.
The Internet has become the recording industry’s public enemy number one because it is easy to send information from one computer to another. Websites took advantage of this innovation by offering music to its visitors, but this soon became a phenomenon bigger than ever expected. The download era “began with website operators offering files for download free of charge…[but] soon transformed into the use of centrally based indexes, with the actual files stored on each participant’s own computer…” (Leman-Langlois 144). These networks of computers came to be known as peer-to-peer (p2p) networks, and have been the biggest rival for the recording industry since.
Although record labels strongly oppose these file-sharing networks, not everyone in the music business agrees. Jim Guerinot, manager of the band Offspring, believes that “the [music] industry brought the downloading debacle on itself” (qtd. in McLeod 526). With the music industry going digital by forcing CDs to be the standard music medium, CDs and computers were a perfect match for each other. The digital format “allowed fans easily to ‘rip’ songs onto their computers and upload music files to the Internet” (McLeod 526). The music industry had no idea that the technology they forced into the marketplace would come back to haunt them. Thanks to some bad timing “[t]he industry opened the door to the digital world, but was dragged the rest of the way by the consumer-led file trading movement” (McLeod 526). The Compact Disc was here to stay, and the record labels had created a problem that could not be reversed.
The record companies have put up a strong fight however. The companies, along with the Recording Industry Association of America (RIAA), have been tracking down users who continue to download songs and are suing them for stealing copyrighted music. They have been taking legal action because “file sharing and other forms of Internet distribution are seen as a threat by the RIAA (and the major labels that it represents) because these new technologies threaten to erode their market hegemony” (McLeod 522). The RIAA has filed thousands of lawsuits against users who have downloaded enormous amounts of music over a small period of time. The RIAA cannot take legal action against millions of users however, so the companies went to congress. The RIAA utilized their power and “successfully lobbied for changes in the judicial system to criminalize file sharing and related activities” (Leman-Langlois 141). The laws, which include the Digital Performance Right in Sound Recordings Act, No Electronic Theft Act, and the Digital Millennium Copyright Act (Imfeld 292-3), were a huge boost for the record companies because they thought it would put an end to file sharing, but they were wrong, however, because the downloading did not stop.
While file sharing is a major threat to record sales and a label’s income, the artist’s income is not affected as much as it would seem. For example, the average cost of a blank CD for the consumer is $0.25 each. When compared to the average cost of an album produced by a major record label ($19.00), there is a difference of $18.75 left to be split between the musician and record label. With the average royalty rates for bands signed to major labels at a mere twelve percent (Rodman 254), the musician earns only $2.25 from every album sold, leaving the record label with the rest of the profit—$16.50. Furthermore, because the record companies control these artists, most of a band’s income goes straight to the label to pay off expenses. According to Busta Rhymes, a rap/hip-hop icon, “[a]ll those videos, the advertising in the magazines…all of these things have to be paid for—from the album pictures to the cassette being manufactured, to the actual studio time to record the songs…Every single red cent has to be made back before the artist can begin seeing money” (Qtd. in McLeod 523). Tremendous pressure is put on artists to produce popular and catchy songs because if their records do not sell, they still have to pay back the record companies for the cost of producing the album. Q-Tip, a member of the group A Tribe Called Quest, was popular in the 1990’s when hip-hop was emerging. The same year that “he was a platinum selling artist with a breakthrough album, Q-Tip was sleeping on his mom’s couch, having made less that year than he would have working at a convenience store” (McLeod 523-4). It is amazing how artists can become so popular, yet still make just enough money to barely get through the year. In the end, all record labels do is promote and distribute albums for artists. Labels are essentially just a middleman between the musician and the listener, and many bands are beginning to ask themselves what would happen if they just take the middleman out.
It would be a lot of work for a band to write, produce, and distribute their songs themselves, but an increasing number of bands are doing just that. Instead of touring the nation making radio appearances to promote new albums, independent, also known as indie, bands are uploading their albums to the Internet and distributing their work online to reach a wider audience. With the download era of the twenty-first century, “the means of producing and distributing music has shifted to individual artists, which means one does not need a major label contract to reach thousands of people” (McLeod 527). Musicians are able to connect with millions of computers and distribute music online through p2p networks, eliminating the need to sign with a major record label. An increasing number of bands are beginning to turn to p2p networks to distribute their music because they see it as a means of free promotion. This way, indie bands are able to avoid major costs, and get their music to listeners. According to Tim Quirk, the vocalist for Too Much Joy:
As a musician, you want your music out there, you want it out in as many places as it can possibly be. This increases the chances more people will pay to see your band when it comes through town (and perhaps buy merchandise), or that a newfound fan will purchase one of your other albums. (qtd. in McLeod 525). A band can never be successful if no one hears their music, which is why file sharing has become such a powerful tool for musicians.
Take the band Dispatch for example, arguably the most well known band in independent music history, which became famous due to p2p networks. While being interviewed for the band’s documentary, Mark Kates, founder of the Grand Royal record label, said that “Dispatch was a band that blew up through file sharing” (The Last Dispatch). Without the Internet, Dispatch never would have become so popular. The band sold over 600,000 albums before they held one last concert in Boston, where 110,000 fans showed up from around the world to witness the free concert, making it the largest concert in independent music history.
It would seem though, that if users downloaded music for free, that independent musicians would not be able to make any money. A study, however, conducted by the Norman Lear Center at the University of Southern California on college downloaders, finds that downloading “does not reduce students’ CD consumption patterns. Fully 73 percent of students who download mp3s reported that they still bought either the same number of CDs or more” (McLeod 525). Before fans purchase a CD, however, they typically want to hear the song and decide if they like it (Rodman 248), and file sharing allows music fans to preview songs before they buy an album. Through file sharing, users can connect to people with similar musical interests, preview music that they would never have come across, and purchase it.
Although indie bands still have to deal with the costs of recording albums and touring the country, the major difference with being independent is that the revenue from album sales goes directly back to the artist. Rather than earning twelve percent royalties and earning an average of $2.25 for every album sold, independent bands receive one hundred percent of the profits for every album purchased. According to Thom Monahan, a musician for the Pernice Brothers, “all the money comes directly back to the band…so we don’t really need to sell tons of records in order for it to work” (qtd. in McLeod 530). After factoring in the costs to record the album and the actual cost of the album and packaging, the profit from each album sold is significantly higher than twelve percent. This allows band members to earn more money, while selling fewer albums than bands that have contracts with labels. Rather than having to worry about selling half a million records just to break even, independent bands are able to make a living selling 30,000 albums (McLeod). If an indie band sells 30,000 albums and earns $18.75 for every record sold (average cost of a record minus the cost of the CD), the band walks away with $562,500 before the cost to produce and distribute the album is factored in. On the other hand, a band signed to a major label, earning an average of 12 percent royalties, would make $67,500—that is, before paying the label for the cost of studio time and promotion.
Despite the financial gains for artists who handle their own promotion and distribution costs through legal download services, certain measures have been taken to prevent the distribution of copyrighted music. Just as illegal downloading has revolutionized the music industry, Apple Inc. has revolutionized legal music downloads with their online music store iTunes. One of the techniques to reduce the amount of illegal downloads was to reduce the cost of legal downloads. After striking deals with a number of major record labels, Apple was able to provide legal music downloads at a cost of $0.99 per song. With a price that low, users can download an entire album for between $10 to $14, or download a single song from an album for just under a dollar. The success of Apple’s iTunes has brought about a legal downloading craze, and Apple recently claimed to have legally sold over 500 million songs worldwide (Jones 239). Since the record labels have teamed up with Apple, they share part of the profit for each song downloaded. Apple’s iTunes is just one of many legal download services found on the internet, each of which also use another technique to prevent illegal downloading called Digital Rights Management (DRM) file protection.
DRM is an additional layer of coding on a music file that uses a form of cryptography to ‘lock’ the file, giving the user fewer privileges with the file. These restrictions on the music file allow record companies to sell music online without having to worry about the songs being shared illegally. Some restrictions on the files include “preventing files from being played back except upon a specific authorized device…or [preventing] files from being played more than a certain number of times in a given time period” (Jones 292). Apple uses their own form of DRM, called FairPlay, to manage how their users can share the songs bought from iTunes. Provided they have the right username and password, uses can listen to tracks downloaded from iTunes on up to five authorized computers, or any number of iPods, Apple’s mp3 player. If a user purchases a song from iTunes, and shares it on a p2p network, anyone who downloads the song must provide the correct username and password of the person who purchased the file in order to listen to the song. Because of Digital Rights Management technology, music lovers are presented with a legal way to instantly download their favorite songs.
There is one loophole with DRM technology, however. DRM does not restrict a user on how many times they can ‘burn’ purchased songs onto a blank CD. Because of this loophole, users can make CDs of purchased music and then ‘rip’ these CDs back onto their computer in mp3 format, eliminating the code that provides protection for the file. Although it is inconvenient for the user, they can essentially eliminate the DRM technology if they choose.
Soon users will not have to worry about DRM file protection though. Apple recently announced in partnership with EMI records that they would provide DRM-free songs from iTunes for a price of $1.29 per song. If they choose to pay the slightly higher fee, music fans can legally download higher quality songs online without any file protection technology, which would allow the file to be shared on any p2p network without needing a username and password. This move could be a huge step for Apple and EMI, but has the potential to be a large problem as well.
DRM-free downloads would allow the user to take songs they have purchased and upload them to the Internet and share them with the world. Many companies believe this will destroy the music industry and music will never be the same. This is not the first time people have been given access to free music, however. The radio was supposed to ruin the recording industry because people believed that fans would no longer buy records if they did not have to pay for the music they heard. Instead, the radio surprised everyone and was a great promotional tool for artists because people were more likely to buy albums that they had heard on the radio and were familiar with (McLeod 524). The Internet works just like the radio in a sense that it allows fans to listen to music for free while the bands fan base grows larger.
Now that a band can promote themselves through file sharing if they choose to do so, the need for record labels is no longer here. Because the labels have so much control over the music industry, bands are under the impression that they need a label’s power and promotional tools to become successful in the music business. Bands are enticed to sign contracts with major labels with the idea that they will be the next breakthrough band showing up on magazine covers and billboards across the nation. But with file sharing becoming the craze that it is now, bands can be just as popular by distributing their music online. Look at Dispatch, or the thousands of other independent bands for example that have made a living as independent artists. If more bands take the independent path and trust that file sharing is not so bad after all, they to can make a living through music. They will be able to earn the money that they deserve and not receive undersized paychecks from the record labels. Independent music would not be possible without the millions of users who support these bands, so help these artists, and download some music.
Works Cited
Imfeld, Cassandra and Victoria Smith Ekstrand. “The Music Industry and the Legislative Development of the Digital Millennium Copyright Act's Online Service Provider Provision.” Communication Law & Policy 10.3 (2005): 291-312.
Jones, Richard. “Entertaining code: File sharing, digital rights management regimes, and criminological theories of compliance.” International Review of Law, Computers & Technology 19.3 (2005): 287-303.
Last Dispatch, The. Dir. Helmut Schleppi. Perf. Brad Corrigan, Pete Francis, and Chad Urmston. DVD. Warner-Elektra-Atlantic Corporation. 2006.
Leman-Langlois, Stéphane. “Theft in the Information Age: Music, Technology, Crime, and Claims-Making.” Knowledge, Technology & Policy 17.3/4 (2004): 140-163.
McLeod, Kembrew. “MP3s Are Killing Home Taping: The Rise of Internet Distribution and Its Challenge to the Major Label Music Monopoly.” Popular Music & Society 28.4 (2005): 521-531.
Rodman, Gilbert B. and Cheyanne Vanderdonckt. “Music For Nothing Or, I Want My MP3.” Cultural Studies 20.2/3 (2006): 245-261.
