It all started with Napster. This flagship free people to people (P2P) sharing in the late 90s, allowed the downloading of music without the authorized permission from the artists and the labels.
Napster became a global phenomenon, offering free downloads with very high music quality. Millions of users enjoyed this royalty until the recording industry sued Napster, and in 2001, it was shut down.
However, despite the victorious fight of the music industry against Napster, several networking programs similar to it have already emerged. Other P2P networks like LimeWire, FastTrack, Imesh, Audiogalaxy, Emule and Gnutella became successors and continued to offer free music downloads.
How has these early free P2P networks affected the music industry? In 1993-1999, studies show that there is a 10% increase of sales in CDs. After Napster was born, a 16% decline in sales was recorded between 2000-2003. In fact, according to the Recording Industry Association of America (RIAA), every year there is a $4.2 billion loses in the music industry worldwide.
Sales is not the only victim in the illegal act of music downloading. Other important factors of the industry are also affected.
Below are just some of the direct casualties of this act
Retailers. Stores lose sales. They cannot compete with the free services offered online by different P2P networks. Many of these businesses opted to close. Thus, resulting to job loses, usually filled out by young people.
Record Companies. Most of the time, the total sales of records released cannot even cover the costs spent in producing the albums. There are also other expenditures like operational expenses, artist development, etc. to keep the labels running. Unfortunately, many recording labels, especially those that are small, also opted to close their businesses. On the other hand, some chose to merge with other recoding companies just to keep the business alive.
Illegal downloaders and music pirates are also affected by their own acts. Around the world, there are a lot of countries that already passed laws against piracy and intellectual property. Once caught, these people can either pay the fine or serve the time in jail.
Loyal consumers who patronized originality are also affected. Because of the free illegal services online, legit albums and other authorized products for that matter, increase prizes.
Lastly and most importantly, the artists suffer. The souls and brains behind the music lose. The songwriters, singers, musicians and producers cannot even fight for their royalties and sales, where they most likely rely for income.
It seemed like a lost fight already during the early 2000s where P2P networks became viral. Fortunately, in 2003, Apple launched a pioneering online store where for only $0.99, a song can be downloaded legally. iTunes was born. It also paved way for other online stores to offer legal downloading services. In just three years, iTunes helped recording companies generate their revenues again.
But the battle does not stop there
Existing P2P networks online still offer free but illegal downloading of music. Recently came to popularity are BiTorrent and PeerGuardian. Although online stores are also many in numbers, the music industry has yet to regain its glory.
It’s up to us, consumers. We have the power to choose between supporting and reviving the music industry or slowly killing the music that has been and will forever be part of our souls and the world. Will you be part of illegal downloading that is slowly killing the music industry? Or be a music steward, protecting the rights of songs, artists, and producers?
Tell us your thoughts.