The Effects of Internet Music Piracy

There is this artist your friend tells you about “Man you need to check out this band N’Sync, they are so rad!!” So you figure hey I will give it a shot…my friend thinks they’re cool. So you use the last $15.00 of your Best Buy gift card on their latest CD. You open the package in your car in excitement, and by the time you open up the covers your thinking to yourself. “Hmm four guys, that don’t play any instruments…hmm, is this going to be any good?” You ask yourself. So you, slip the CD in your car stereo. Utter disappointment when you listen to the first song, you skip to the next…and the next. Come to find yourself wasting your money on a crappy CD. A disc that may have been good to a 14-year-old girl, or your best friend Tony, but your musical taste is slightly different. Music swapping is in the music industry and the consumer’s best interest, it helps artists grow, and consumer’s interests broaden in the end ultimately increases sales and profit for record companies. In this essay I will explain exactly how and why my theory is true.

If you live in a dungeon, or in a Amish farmland, you may not know atrocity that the RIAA is committing right now. “Sue em’ all”, is the infamous theme for the RIAA as quoted by file sharing supporters. The RIAA has sued a 12-year-old, put her into tears and has offered no sympathy (Fox-news, 2003). RIAA has also managed to file suits against a few dead people, 83 year old Gertrude Walton for one for “sharing over 700 pop, rock and rap songs under the alias “smittendedkitten”. She had passed away 3 months prior to this lawsuit and refused to even use computers according to her family (Mook, 2005). Although they are not completely evil, they did drop charges against the deceased Mr. Scantlebury. After giving 60 days for his family to grieve then pay up, they decided to drop this particular case because of “abundance of sensitivity” (Doctorow, 2006). What RIAA fails to look at in all these cases, they sue whoever’s name is on that ISP’s IP. The only problem with this is that many people tap into other people’s wireless connections. It is possible to spoof IP’s, Trojans, and gateways can be setup on computers so that other computers may be using your IP right now, and they also may have collected inaccurate data from the ISP. This is why there are lawyers right now fighting the RIAA in a class action lawsuit (http://recordingindustryvspeople.blogspot.com/).

Advocators of anti-piracy generally use other countries in defense. Do we want US to have an 85% piracy rate like China, or a 99% piracy rate like Paraguay (IFPI 2005)? Piracy is so bad in those countries counterfeits are available not only on the streets by vendors but in stores, and they look so genuine, you cannot even tell. Famous artists in those countries make no money from album sales; they generally have to rely on making their money off of promotions and concerts. But on the other hand, look at their economy compared the US, and their culture. If CD’s cost 100 US dollars, in United States, but some guy down the street will sell it to you for 15 dollars, who would you buy from? The cost of CD’s in other countries was ridiculously higher in many countries because average national income was never taken into account. This is why piracy has been taken by storm and is there to stay. Another anti-piracy perspective from the RIAA states that:

“Record companies lose. Eighty-five percent of recordings released don’t even generate enough revenue to cover their costs. Record companies depend heavily on the profitable fifteen percent of recordings to subsidize the less profitable types of music, to cover the costs of developing new artists, and to keep their businesses operational. The thieves often don’t focus on the eighty-five percent; they go straight to the top and steal the gold.” (RIAA, 2003)

The record company also locks artists in really bad contracts. Yes they may get famous, but the record company gets most of the profit. Artists to them are like stocks. They invest in their artists, and expect a high turnaround. This is my opinion is a bad structure for music because the record company encourages artists to “sell-out”. So the record company can make more money. You ever notice how artists are now ditching their huge record company after their contract expires? Not only do they make more money but they have less pressure. Online also gives a huge medium for underground artists to be recognized, and many have already through websites like Myspace, and Youtube.

You also may not be aware of the anti piracy methods already taken place in CD’s. Sony’s XCP copy-protected CD’s install a software on your computer that hides files, and is virtually uninstall able by any normal means. Hackers took advantage these hidden files and made a virus that disguises themselves as these Sony files but are actually back doors on your computer. Because they use Sony’s XCP software already installed on your system, which you cannot uninstall, they go virtually undetected by any virus detector. (Ward, 2005). Another anti piracy method in the works is Cactus Data Shield. It is designed to add noisy garble in any CD-R’s burned that can effectively damage audio equipment. The company that developed this technology is Midbar Tech and the company is currently trying to sell their plans to Sony, but with Sony’s recent predicament, I doubt they will get that far. (New Scientist, 2005)

And who is the evil in music piracy? According to an interview with Courtney Love who is a Musician/Actor, it’s the record companies.

“Artists want to believe that we can make lots of money if we're successful. But there are hundreds of stories about artists in their 60s and 70s who are broke because they never made a dime from their hit records. And real success is still a long shot for a new artist today. Of the 32,000 new releases each year, only 250 sell more than 10,000 copies. And less than 30 go platinum.

The four major record corporations fund the RIAA. These companies are rich and obviously well-represented. Recording artists and musicians don't really have the money to compete. The 273,000 working musicians in America make about $30,000 a year. Only 15 percent of American Federation of Musicians members work steadily in music.

But the music industry is a $40 billion-a-year business. One-third of that revenue comes