Music Piracy and the Music Industry

By Kyu Hee Chu

Reviewed by Jennifer Williams 

The debate on whether MP3s and music piracy is leading to the downfall of the music industry has been an ongoing one.  You certainly don’t have to be a rocket scientist to know that at least part of the decline of the music industry has been attributed to the widespread use of MP3s and file-sharing programs that allow illegal transfers of music files.  On the other hand, the decline of the music industry has also been attributed to a variety of other factors, which will be discussed in further detail in this article.

First let’s take a look at the argument that the music industry is making. The Recording Industry Association of America (RIAA) is an organization composed of music labels that create and manufacture about 85% of all music produced and sold in America.[1] The RIAA claims that music piracy harms the US economy at a rate of $12.5 billion per year, and has resulted in the loss of at least 70,000 jobs.  Some other statistics that the RIAA puts forward are that since 1999, music sales in the US have dropped by 47% (from $14.6 billion to $7.7 billion), and that from 2004 to 2009, about 30 billion songs were illegally downloaded.[2]

Need I say more? The numbers speak for themselves. Or do they?  Can the music industry’s monetary loss be attributed completely and wholly to illegal music downloads?

Perhaps not.  According to an online UK newspaper, The Guardian, the decline in the sale of songs cannot be attributed solely to the fact that people are downloading the files free of charge off the Internet.  Instead, the Guardian states that the decline in the sale of songs is due to the fact that people are now spending more of their money on games and DVDs.[3]  Thus, perhaps people are not as into music as much as they are into games.  Does this mean that people find it more satisfying to spend their money on videogames as opposed to spending it on music? I have to ask though – can’t it also be argued that perhaps people find it easier not to spend money on music since they know they could easily find it for free online?

But wait, there’s more. It has been argued that “the music business killed itself.”  In other words, the music industry underwent many changes in its structure which led consumers to become disinterested in the music that is out there today, which consequently led to the decrease in purchased music.  Some of these supposed changes in the music industry come from the idea that the businesses are not being run by people who love the music business, but are instead being run by people who only worry about profits and losses.  For example, in order to save money while maximizing profit, these businesses have made deals with big box retailers like Wal-Mart, Target, and Best Buy which only put up some of the music that is in high demand, while disregarding other kinds of music out there that may be of interest to consumers.  Another contributing factor accorded to this line of thinking is that with the Telecommunications Act of 1996 came the centralization of radio stations, which led to the stations only playing a limited number and variety of songs.[4]  Thus, this argument attributes the decline in the music industry to the business strategies employed by companies that focus more and more on profits and only on profits.

This seems to be a compelling argument – it is certainly true that music has become more and more commercialized and it’s easy to get tired of listening to the radio after awhile – many of the stations play the same limited number of songs over and over, and there isn’t much variety.  However, is the fact that the businesses are concerned about profits necessarily a bad thing?  Would they not work harder to make sure the consumers like the music that is being produced and sent out into the public if their goal is to make money?  After all, people will not spend money on music that they don’t like.

This is only a short review of the debate on the decline in the music industry and the role music piracy plays in this phenomenon.  It seems undeniable that the music industry has taken a heavy hit due to the illegal music downloading, which has caused music sales to decline significantly.  On the other hand, perhaps MP3s are not the only reason the industry finds itself in trouble. There are certainly arguments that people are just not spending as much money on music because they are more interested in other things, such as games, as well as arguments that the industry is just focusing too much on profits and less on quality music.  Whatever the reason, one thing remains clear – the music industry needs to find ways to fix it.


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