Studios make movies to make money; publishers publish books to make money; music companies produce cds to make money – content producers want to exploit their content to make money. That’s why they seek strictly to enforce their copyright in movies, books, music, and so on. It’s how they make their money. And they adopt measures to protect this content from piracy. So, they objected to the photocopier, and to double-tape decks, even though a photocopy or copied tape is rarely as good as the original. Now, however, the benefits of digital content are threatened by the ease of copying digital content without loss of quality. And the content producers, in particular the movie and music companies, are (controversially) trying to use technology to prevent such copying and (even more controversially) to use the law to support (and enforce) such anti-copying technology. They have failed to understand why it’s getting such a bad press, and they have become locked into a mindset that seeks to corall and control their content. And they can’t see that much of this anti-copying technology makes life very difficult indeed for their customers.
The challenge for these companies is to find a way to co-exist with both the advantages and disadvantages of digital content, without losing customers. As Antoin recently demonstrated, however, they are not meeting this challenge very well:
Revenues are falling in the industry, from around $38 bn to less than $30 billion in a few years and that’s without taking inflation into account.
So he posed the questions
what concrete steps can the music industry take to stop, or at least slow down piracy? how can the music industry make money from peer-to-peer and music downloads? how could they trial this?
In reply, Bernie ventured a proposal constructed on making available 96 kbps free MP3 samples, and selling easy to find 192 kbps tracks of the same material. He’s absolutely right that one key to growing the market is convenience. The local record store is still a convenient way to buy cds, and its convenience is what’s keeping it alive in the face of competition from online retailers. If and when downloads become as convenient to purchase and use as cds are, then the music industry will do itself the favour on which Antoin and Bernie muse. Apple have seen this; they have come out against some of the technology that music companies use to prevent copying because that technology makes enjoying the music very difficult even for legitimate users – making download and use more convenient can only be good for sales of Apple’s products.
The solution lies in getting the right mix of convenient things: good harware (computers, players), good – fast – broadband, easy sharing between machines, persistence and durability of downloads, ease of download (software, hardware, internet connection), ease of location – the key is to make it easy for the non-techies. Bernie might buy his “tracks from Yahoo! Music, the Podsafe Music Network and iTunes”, but a lot of people with computers don’t download music at all because they think it more convenient to buy the cd; and a lot who do download music, download pirated material rather than protected material not so much because it is cheaper as because it is often simply more convenient.
Making music download considerably more convenient will divert many people from priates to legitimate sources, which will slow down piracy; but the industry will have to accept that promoting convenience and thus growing the market will result in some piracy. They will simply have to stop worrying about this as a problem, and embrace the internet as the solution instead. As Apple are proving with iTunes and the iPod, if paid-for download is convenient, people will use it. The answer to Antoin’s questions then: do more to make download convenient rather than difficult. What’s so wrong as a marketing strategy with giving people what they want?
You hit the nail on the head when you said the removal of quality-loss when copying is the big difference between downloading and recording in the past. The other big difference is the internet allows you to copy from millions of other users.
As a teenager I had hundreds of albums recorded onto blank cassettes, as did most of my friends. However, we also bought more original albums than any of our peers. The copying complemented our record buying; it did not replace it. If anything, it fed our hunger to hear new music. There was research done years ago that showed that those who had the most copied music also bought the most music. In this light, copying was good for the music industry.
The impetus for me and my friends to buy music was twofold: 1. Originals were better quality, so some albums you’d definitely want to own. 2. For our tape trading network to work, there had to be an influx of original music coming in for others to copy. Our group was finite, so the onus was on everybody to regularly buy original music which could be copied.
These 2 criteria no longer apply. Originals are no longer better quality (to anything but the most ardent audiophile’s ear) and, thanks to the internet, tape trading networks are no longer finite – you can copy music from a stranger in Venezuela with no obligation to make newly bought music available to him.
Consequently, there is no incentive for somebody to choose a legitimate download site over a peer-to-peer site other than it being at the discretion of their conscience.
Even the plus with buying legitimately of having an inlay card or record sleeve is absent when downloading legitimately.
Some of my friends readily admit that since they’ve started downloading music for free they don’t have any impetus to buy music. I use peer-to-peer sites but only to find music I wouldn’t buy otherwise, mostly old stuff. However, the temptation to save a trip to the shop and download a coveted new album is there. There is evidence that some bands are viewing recorded music in general as a lossleader and using it to market themselves and make the real money from live performance – this obviously works in favour of bona fide groups and against manufactured pop acts hoping to hit paydirt with one or two hits.
But as for making money from recorded music, digital copying seems to have made a quantum difference. It is not really comparable to the tape deck recorder.
Apple’s efforts to end DRM is on the money. Once music is downloaded from a PC it doesn’t make sense not to allow it to be transferred to the owners’ other devices, even if it allows the owner to transfer it to his friends’ devices. Finite ‘real world’ groups of people sharing music has never been a problem for the music industry. In fact it has helped it, creating demand for the product.
The dilemma is the ease with which people can download online already. One way the industry can capitalise on this is to encourage the use of music within finite virtual groups. For example, when somebody downloads a song or album from a legitimate site, they should be able to nominate a group of friends they can share that music with online free of charge. This creates a social group around the music, which in turns brings an element of responsibility. To be part of that group, there is the assumption you will contribute, which would mean spending some money on downloading original music.
The phenomenal success of social networking sites surely means this could be a contender. Downloading from the net should not be viewed solely in the context of personal consumption, but of social bonding. The incentive can no longer be viewed in terms of product but in terms of human interaction.
The details as to how this can be achieved is for better technical and marketing minds than mine to figure out.
PS: Reducing the cost wouldn’t hurt either. It’s cheap to record albums now, there’s no CD/record/tape manufacturing costs or distribution costs and no retailers whose costs have to be covered (even marketing can be done cheaply on the net) so the excuses for high CD prices no longer exist. As I’ve said, we don’t even get the sleeve artwork anymore.