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The Economics of File Sharing
Howzer writes "A great Salon article popped up today, and it appears Stan Liebowitz at the Cato Institute is having second thoughts about his paper that was published on May 15. It seems the facts simply don't support his earlier assertion (& the well-known position of all the major recording labels) that downloading hurts music sales. It's good to see this argued from another angle, especially by a guy like Liebowitz."
Personally, I have purchased more music since buying a cd burner. My interest in music has increased as well. Now only if the iPod would drop in price.
"I don't think it's selfish, to eat defenseless shellfish." -NOFX
I can tape the song off the radio just like I can download it off the Internet, but I still want to buy, buy, buy.
Why does this not register with label execs, economists, etc.?
Can I bum a sig?
Of course file sharing hurts sales. Just like double tape decks hurt sales. Just like not having a law preventing people from owning two VCRs hurts video sales. Just like photocopiers hurt the sales of sheet music.
Technology changes things. In some ways better, in some ways worse. It changes peoples behaviour, and it changes the machanics of society.
The question everybody should have been asking all along is, "Does it hurt sales so badly that nobody will want to make music?" The answer seems to be an overwhelming NO, so if thats the case, history suggests that we are should tolerate it until it finds its natural 'fit' within social behaviour and the economy. Just because it facilitates illegal behaviour does not mean that this illegal behaviour is going to have a negative impact on the market - and if you think about it, many discoveries, social patterns and values we hold up as examples of our progressive society started up as being illegal behaviour until we came to terms with its perceived threat and realized that many things we perceive as threatening or damaging can be channeled in a positive socioeconomic direction.
"Old man yells at systemd"
Or the stuff i kept and DIDNT pay for, i never would have in the first place.. so no-one actualy lost any revenue...
Just because they didn't lose any revenue doesn't make this not stealing.
I'm sick and tired of people arguing that this doesn't hurt sales. [...]
I don't own a lawnmower. I borrow my neighbours. This affects sales of lawnmowers.
So should they stop sharing of lawnmowers? Yeah probably. Will I be happy about it? Not one bit, but I'll accept it.
I sometimes hitch a lift with a friend rather than use my own car. This affects petrol sales.
Should they stop people hitching lifts? Yeah probably. Will I be happy about it? Not one bit, but I'll accept it.
I often drink water out of the tap, rather than buying it. This affects bottled water sales.
Should they stop people drinking out of taps? Yeah probably. Will I be happy about it? Not one bit, but I'll accept it.
I sometimes think about naughty things, rather than looking at porn. This affects porn sales.
Should they stop people thinking naughty things? Yeah probably. Will I be happy about it? Not one bit, but I'll accept it.
(I'm not sure what my point is. Draw your own conclusions...)
DRM, as I see it, is merely the protection in the software, on a CD or whatever, that would allow micro-payments. It doesn't do this yet, but in principle it could. That's what I view as closer to ideal. They can let you do a lot and you pay a higher price, or let you do only a little in which case you'd be paying a lower price.
I read this with a sinking feeling in my stomach. What do you think he means by "higher" and "lower". In this case, I doubt that the price will be lower than the current cost of music. The record industry doesn't lower prices.
If DRM with micro-payments is succesfully introduced (read legislated) it wont mean that I pay less for music. The record companies will charge me for my copies. They'll charge me for each time I play it. And though initially I paid 99 cents for that song, after a year, I've payed $5 for that one song and I will keep paying for that song in perpetuity.
The record industry has a very bad record (no pun intended) at passing along savings to the consumer. The CD was supposed to make the whole process cheaper, lowering prices for the consumer. But that never happened. Instead, the prices went up (which they justified by saying that new technology costs money) and they stayed up.
So, if they can release music digitally in a way that prevents copying and tracks your use of that music, the price wont drop. It will increase, despite their cost savings on distribution.
sweat
It breaks my pluginses, my precious!
Here, effectively, is what Stan Liebowitz has just said.
And I'm done with listening to egomaniacs like Liebowitz. I'll stick to my Magic 8 Ball for my predictions on how DRM and P2P will turn out. It might not be more accurate than chumps like Liebowitz, but at least it doesn't collect a fat fee every time it spouts a random prediction.
If you were blocking sigs, you wouldn't have to read this.
Anyone who reads Declan's politech mailing list or any other list where the Cato Institute frequently releases its propaganda has had his face rubbed in that.
However, what struck me about the Salon interview is... the poor quality of the thought that underlies the Cato Institute pronouncements. on various issues... the detachment from reality.
I read the article and kept wondering what rock this guy had been living under for the last few years.
"and then he tried to transfer the sound to the digital audiotape that he had, and it wouldn't do it. He blamed DRM for that.
I wrote him back and said, look, be mad at the Digital Home Recording Act. That's what said you can't record from a digital source onto a digital audiotape. It has nothing to do with DRM."
Being locked out of the use of one's own software and hardware AND intellectual property to protect corporate copyright holders is irrelevant to DRM? What's this guy smoking? I think we all need to know so we can avoid it.
His comments about fair usage in an academic context... perhaps he hasn't used computers long enough to have gone through changes in digital format, perhaps he thinks that floppies were always 3.5" and CD-Rs were the first portable mass storage.
Perhaps he really has no clue that a DRM imposed by a company that no longer exists in a legacy media format might make it impossible to access information necessary to legitimate academic research... anything from a masters' thesis to a kid trying to find out what music in the early 21st century sounded like.
I guess "no clue" is the best way to characterize this guy. Is he typical? I strongly suspect so.
Why are we taking the pathetic assholes at the Cato Institute seriously?
Not that they're totally useless, if they happen to support your position on censorship (government ONLY, they don't seem to understand that free-enterprise censorship exists) by all means use them to bolster your position's credibility, when dealing with government officials, if they aren't familiar with the Cato Institute, it might help.
Just don't take them seriously even if they happen to be on your side.
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