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RIAA vs The Economy
thumbtack writes "Boycott-RIAA.com is running an analysis
of the RIAA sales vs a number of other large corporations. It was compiled by
Justin
Moore at Duke University. It is really quite interesting, showing the the
RIAA sales are pretty much consistent with the rest of the economy. From the analysis:
I would assert, however that it does make the case in cold, hard numbers that
the RIAA's claim of digital piracy ravaging their sales must be taken with a rather
large grain of salt. The CEOs of Eastman-Kodak are in a nearly identical economic
situation as the RIAA, yet do not have the luxury of blaming digital piracy."
The CEOs of Eastman-Kodak are in a nearly identical economic situation as the RIAA, yet do not have the luxury of blaming digital piracy.
Obviously, they need to add a license agreement to their film products. Just forbid the stuff you don't like to happen, and then you can use every crooked law in the book to sue folks who switch to digital.
It looks more like the RIAA is targeting the 1% of people who actually pirate mp3s to account for their slowing sales due to a poor economy. Atleast Kodak has a valid reason why people don't want their film products.
I don't know if Eastman-Kodak's financial situation is a good marker for economic trends. I think a great portion of their market has faced the invasion of digital photography which is certainly cuts their consumer film sales down significantly. Their economic situation may be due partially because of the economy, but also partially to an emerging technology that they is taking away some of their marketshare.
Nothing from nowhere I'm no one at all
http://news.bbc.co.uk/2/hi/business/1999556.stm
of course this has nothing to do with the fact that the public is tired of being ripped off and taken for idiots and now is not interested in their products.
so instead of creating products that people actually want or investing in talent instead of boy bands and the like, they blame their outdated buisness model on piracy, sounds like sense to me.
are you smiling yet ?
This particular analysis does not tell us exactly how accurate the rest of the model is, and several other professional statistician shortcomings. Remember, there are lies, damned lies, and statistics; this is just another statistic.
In other words, they are saying their numbers are also probably wrong. At least they admit it.
Very popular slashdot journal for adul
and dupont can blame mental patient founders
and exxon can blame stricter environmental laws
and honeywell can blame global warming affecting thermostat sales
etc etc
Companies need to evolve to the state of the world, not point fingers about causes (real or imaginary) of thier misfortune. Digital content distribution is real and it is here to stay. It can either be looked at as an opportunity or as a degression; obviously the RIAA sees a degression since it can't rely on its standard business model and can't adapt to the change.
I am hated.
I am one of "those" dot commers responsible for screwing up the economy.
This is the attitude I get from a lot of people. Since the crash all the non-tech people I know have taken every oppertunity to take a cheap shot at me, "Ya told you it wouldn't last forever" or my personal favorite, "It's never coming back"
"Bullshit" I say to myself as I try to keep my temper from flaring up.
This type of thinking perme-ates (sp?) our society simply because nobody likes being replaced by younger newer models. This is the way it's been since the dawn of time. Someone makes technology (Castles) and someone else makes a technology that makes the former irrelevent (gunpowder) With both the RIAA and Kodak, it's the same problem. Someone came up with technology that quickly made the foundation of these organizations obselete.
In the case of the RIAA, the combination of internet with Mp3 compression made the old models of music distribution obselete. I worked for a local music magazine for a few years, and often I would hear rockers cry about how Mp3's are sending them all to the poorhouse crying because they can't sell CD's anymore. No matter how many times I would try and tell them website+thawte+oscommerce=mp3 online store they just wouldn't listen because they were all brought up to believe that the RIAA method was the only way. Now apple sells songs 99cents apiece and is making a fortune. With all the money and power the RIAA has, it's a shame they didn't adapt the way apple did and just give their customers what they want.
A good sign of how well CD distribution is dying is the ill fated "Wherehouse" music stores. To my knowledge here in san jose, they are all gone. CD sales just slipped into the toilet and all their stores have just vanished.
Kodak isn't much different. For years they depended on film technology as the cornerstone of their business. By the time they entered digital photography other players had already developed cheaper and more mass producable camera's with higher quality than kodak. I suppose kodak never thought that digital technology would catch up with film, they should have paid closer attention to moores law.
Both companies are old hats, trying to milk every dime out of innovations that are already 100 years old. Let them die already so the new upshots can give us better, faster, cheaper.
Of course they do!! The RIAA KNOWS that the reason their sales are down is because the economy sucks....See, they're LYING...when they claim that p2p is hurting sales. p2p threatens their distribution model like nothing before and they'll do anything to kill it. They'll lie, cheat, steal, sue, bribe (mostly Congress) and do whatever else is necessary (whether ethical or not) to keep the mother lode they (now) exclusively mine. the things I've described above aren't new either...they've been doing every one of them for many years (back in the 70's and 80's the record company radio reps used to be known as SNOWMEN and I'm not talking about the weather here!).
It looks like to me that this report does not prove that the decline is due to the economy, it simply suggests that the decline is statistically consistant with it. It is possible however that both arguments are correct. The decline may be due to the econonmy and therefore (because of the economy) consumers are turning to piracy as a reasonable alternative. I really think the underlying problem is that the big media companies need to take a course in basic economics and lower their prices! Used CD's, gnutella (etc), and the economy all play a role in declining sales. They should lower their prices with the decline in the economy and revenues will increase!
-Sean
I don't know about you, but I don't care if someone presents an obviously biased view. I just care if they can back up their bias with good arguments and data.
Four fifths of all our troubles in this life would disappear if we would just sit down and keep still. -C. Coolidge
I have few close friends that buy CDs. They are mostly over 30 with well-paying jobs and extensive CD collections from the pre-Napster era, yet they do not buy CDs anymore. Instead they download (bootleg) all their tunes, including entire albums. Tell me you're surprised.
I recognise that the existing entertainment sales model is a dinosaur, but to suggest that music downloading hasn't affected the industry's bottom line is absurd. Granted, they may have made MORE by switching to a different model, but that says nothing about the source of their current state in this transition period. I don't believe the hype.
Copywrite infringement is not stealing. Both are wrong, but let's at least get the terms correct before we start equating it theft on the high seas.
Finkployd
P2P is distributing the RIAA's member's works for free to anyone that requests them. You CANNOT compete with someone taking YOUR PRODUCT and giving it away for free.
Hmmm... The RIAA seemed to do pretty good with cassettes that let you copy their product and give it to some one else.
CD burners have been available longer than P2P and don't seem to have hurt them much.
Oh, and the movie industry seems to do allright with video tapes.
The PC game industry seems to have done pretty good against people copying games and giving them away.
People are taking the RIAA's property and giving it away for free without permission, there is no way around this fact, no matter HOW you try and justify it.
Correct. But, as the cases above show it is possible to compete with very inexpensive. Oh, and just like the other cases of this same thing it is not free. Just very inexpensive. The cases mentioned above you still payed for media. With P2P you pay for your internet connection.
There is no justification for stealing, the problem is that a disruptive technology has entered the marketplace, and rather than embrace it as the opportunity it presents RIAA members have decided to try to put the genie back in the bottle. There attempts at embracing the technology have been feeble due to infighting (two subscription services that couldn't share catalogs). Not presenting a product that the consumer wants (subscription services only allow you to play music on your computer). Pricing that was unacceptable $10 a month whether you download music or not.
In the end, it appears Apple may save the music industry from itself by providing the product that people want, at a reasonable price, legally.
Ummm. due to ASCAP/BMI, even the "downloaders" still pay royalty. You buy anything advertised on radio, or admission to a club or even a meal at a goddamn restaurant and RIAA gets a slice.
When will you RIAA supporters get it thru your thick skulls that it is OVER. For the longest time you got money from us every which way. We paid three four, five times for the same piece of music. Now that the REALITY of the world has changed, you can't stand the fact that you can only get us one or two ways.
And even that is better than the rest of us, who have to work a day to get a day's pay. You and your artists think it should be work one single day and get paid for the rest of your life, and your descendants after you, too. Fuck you and your abuse of the royalty system.
And I don't want to hear a peep about how the music will die. Somehow still, I don't think you will have any trouble signing acts who will only earn 1.8 million a year instead of 18 million. Most acts are in it for the pussy anyway. But it is you who is locked into the cashflow, because how are you going to get pussy with your ugly face and no Ferrari?
Stealing a physical item and copyright infringment are not the same (no matter how much the RIAA would like you to believe).
I think the problem is that the RIAA only know one business model. That business model is out dated and consumers don't seem to be buying into it. Consumers are saying quite loudly that they want to pick and choose music (even by the track) and they want it cheap. People will pay for it (see the Apple music store for proof) if it is packaged attractively. Capitalism doesn't make any promises that your business model will work, nor does it promise that it will continue to work later even if it works today. If the only way to get someone to buy a car was to deliver it your house full of fine-ass women and cases of Heineken, then you damn well better believe that car dealerships would be doing just that. And right now, the RIAA has the equivalent of a large segment of their consumers wanting their cars deliever, with women and beer.
For christ's sake can anyone get this analogy right? To take something with a grain of salt means to take something as significant as a grain of salt -- which is very tiny (read: insignificant).
Bull.
There are two theories about the etymology of the phrase "taken with a grain of salt." One theory traces it back to the Latin phrase "cum grano salis", which was found -- among other places -- in the works of Pliny in the first century as a description of an additive to make an antidote effective. A second, more believed theory traces the phrase to the kitchen table, where salt can make any dubious dish a little better.
In either case, the meaning of the phrase is not to treat something as insignificant, but rather to subject it to a healthy dose of skepticism.
The
1. Many buyers and sellers
2. Low barriers to entry and exit
3. All buyers and sellers are price takers(unable to affect price)
4. Homogenous product/service
And most relevant here:
5. Perfect information
Before people were unable to properly sample a music product before purchasing it, and therefore made their purchasing decision based on incomplete and often misleading information - often by factors that had nothing to do with the quality of the music (hype, etc). File sharing has created near perfect information for consumers, and the results suggest that with this information consumers have decided that they were not getting their money's worth in value. Also, and this has been proven in court, the small number of large recording companys have effectively created a cartel - and have and continue to collude to inflate prices. This behavior is expected in a market with such conditions. How else can one explain the inflated price of music despite obvious and significant efficiencies and cost reductions in the production, distribution, and manufacture of recordings?
This article is merely stating the obvious. It's a sad state where you have to explicitly state the obvious in order to debunk the utterly twisted view of any organization.
/. fashion. :-)
That said, I'll state the obvious from my perspecitve, the consumer. I only have so much money I can spend on CD's. I love music, and I'm pretty sure I buy more music than the average person, roughly 5 albums a month. If I could, I would buy more, but after losing my job and taking up a new job that didn't quite pay as much as my old one, having car payments, rent, insurance, utility bills, and a spouse to feed, there's only so much left to spend on what is essentially a luxury item. I don't think this is much different than most average people.
That said, I normally don't pirate software, I don't steal from people, and I consider myself to be a good citizen and neighbor. HOWEVER, I do download mp3's. Is it legal? Hell no. But so are a lot of other things that otherwise good citizens do which really doesn't harm anyone.
My CD buying patterns are strongly influenced by my economic status, and have never been influenced by p2p file sharing. (I can't buy 10 $15 CD's when there's only $75 in my posession.) I don't feel like it's morally wrong to copy something "virtual" (digital data) that I otherwise wouldn't have purchased anyways. The only thing that has changed with the arrival of p2p file sharing is that I listen to a wider variety of music, and make better purchases. (I buy more of what I like, and have fewer CD's I regret purchasing.) In short, I'm what would otherwise be known as an "informed customer" which is usually viewed as a "better customer" in most other industries.
So the bottom line is, yes, people download mp3's. Yes, people still buy CD's, whether or not they think $15 is a rip-off or not. And finally, yes, there are a (probably small) handfull of people who have likely stopped purchasing music completely since they've been able to compulsively download all their favorite music. On the other hand, there are also people that walk into record shops and shoplift CD's, which probably does much more damage. Either way, the number of shoplifters and p2p thieves are likely little more than static noise in the overall sales figures. Think about it, even if record shops all of a sudden stopped "tagging" the CD's and removed all surveilance cameras and tag sensors at the door, most people would STILL pay for the CD rather than pocket it. (Admittedly, the same shoplifters would probably steal even more hard cold physical products such as CD's are, if these surveilance systems weren't in place, but that's a bit different than stealing the data.)
So, the RIAA's claim has little basis, I'm preaching to the choir, stating the obvious, posting AC, and otherwise enjoying another day of bashing the favorite enemy in genuine
"Good?"
I thought we were talking about property. What people refer to as "Intellectual Property" is neither physical property, nor a service rendered. Music is a service if it's a live performance. If you sneak into the venue, you're stealing the service. If you steal CDs, you're stealing plastic laminate discs.
If you're stealing cable, you're stealing a service. Ditto for internet access, cell phone time, etc. Those services are provided at a cost to the provider.
You cannot "steal" ideas. "Intellectual Property" is ideas.
Copyright is not property. It is a temporary legal monopoly on the particular expression of an idea. It isn't a turnip, goat, or plot of land.
You need to get out of the mindset that ideas can be property.
"it was like the equivalent of going out of business 5-6 times."
Well, if the accountants hadn't multiplied the profit margin numbers five or six times...
Here's a doozy.
I got these numbers from the Blockbuster website:
DVDANALYZE THAT / (SUB)
$21.99
VHS ANALYZE THAT / (P&S DOL)
$16.99
CD
ANALYZE THAT / Original Sound Track
$17.98
That's right. The SOUNDTRACK costs more than the VHS version (and only slightly cheaper than the DVD)
Now, let's not go into the fact that the DVD costs nealy as much and gives you more value... let's also go into the fact that people aren't *Nearly* as resentful about movie prices as they are about CDs.
Why?
You can RENT DVDs. If you just want to see the movie, you can fork over $4 and see it... no problem.
The RIAA could have had the benifits of File Sharing before File Sharing... Like only the one song on the radio? Not sure about the other 9? Rent the album for $2. If you don't like it, don't buy it.
Unfortunately, the RIAA isn't even keeping up with the business models of the late 1980s, let alone the business models of the 21st century.
So you advocate the artificial creation of scarcity? So the owner of an otherwise non-scarce product can artificially create scarcity so that something that wouldn't otherwise have value has value?
I can understand the artist's desire to make money, but things that are by nature NOT scarce should not and, in the long term, CANNOT be made scarce. Legally or illegally the market will make certain of that.
The owner consumed resources to develop the IP, and it is reasonable for that owner to expect to extract value from that investment.
Many people create IP and don't expect to extract money from it. Many others even invest time and money creating IP *expecting* an ROI and never get it. Just because something requires time to create doesn't automatically mean they are entitled to money. The market decides what any given product (or IP) is worth. If the market has decided that music in its digital form is free then the artists either adapt to that reality by taking advantage of free music distribution to promote themselves, their products, and hopefully score endorsements, or they can find something else to do for a living.
I have yet to see a credible argument that only tangible property has value.
It's not that IP doesn't have value, it's creating artificial scarcity that gets you (or the RIAA, rather) into trouble. Charging $20 for something that costs a buck and for which even $3 should create healthy profits is as much robbery as people getting some free tunes online. You overcharge like that and you're just ASKING for a black market to be formed (file sharing) or asking for someone else to redefine your market (Apple).
The thief can justify it however he or she wants, but the IP has less value after he or she takes it without permission.
Maybe, but if the owner had chosen a price nearer to its NATURAL PRICE the owner would find that fewer people would "pirate" it and, thus, fewer people would lower its value by taking it without permission. In fact, I'd say that piracy is bringing the overall price of music to its NATURAL PRICE. They charge $20 for CDs but lots of people get it for free. Perhaps if you did the math you'd find that averaging the total amount earned and the total amount pirated that the final amount earned was, say, $6 a CD. To me that means that that's the NATURAL PRICE.
Legally or not, all products in a free market WILL find their natural price. Free markets do that.
But in the end, yes, digital distribution will reduce the "value" of music. That's because most of the value has been concentrated in the DISTRIBUTION of music and that's now nearly cost-free. I'm not convinced any of this really affects the artist who generally earns more money from concerts and endorsements than from the sales of their CDs.
You can steal cable,
Signal, if you 'steal' cable you're connecting illegaly to an electric circuit that has a finite capacity to source current. You are 'stealing' their signal strength and if enough people steal it they will have to increase capacity to maintain that signal for their paying customers. You are in fact stealing a physical good.
internet access,
Bandwidth, if you steal internet access you're sucking up bandwidth that paying customers are being denied. The ISP will eventually have to lay out cash for hardware to compensate.
cell phone time,
Circuits, if you steal cell phone time you're filling circuits of which there is a limited supply. If you don't know the value of cell circuits as a physical good then you're out of the loop. Again, the cell companies will have to lay out cash and buy new hardware to increase capacity.
Their good is music.
If you're stealing CD's from a store, you are stealing music. They have to print more CD's to make up for the ones you steal. If enough are stolen, they will have to print more or risk not having CD's to sell to honest customers. If you're making a copy of the CD (And frankly, most of the music 'stolen' is not a perfect copy of a physical good but an imperfect copy of part of the good) you aren't denying the company producing the CD any inventory. You aren't doing anything that will force them to create more CD's.
Are you stealing art if you photograph the Statue of Liberty? Distributing copies of someone else's music without their permission may be wrong but it is not theft in the same way that the things you mentioned are theft.
tell me much. Stats are stats are stats. I did enjoy reading it, but feel the answer is elsewhere.
CD sales have dropped for me recently and this is why.
DVD movies now occupy that under $20 knee jerk purchase price point. Everyone knows a DVD is better than a CD in general, so how come the CD is still so expensive? I don't think twice about $16.99 for a DVD, that's a nice deal really. So what does that do for the same pricing on the CD? All I know is that $16.99 number on a CD is pretty unattractive in general these days. To pay as much for a CD as I do a movie, it had better be a damn good CD.
The current buttload of music being pimped via the usual Clear Channel right now is garbage plain and simple. Sure, there is plenty of good music, but it sure is hard to find, unless...
One can sample! Maybe that $16.99 is worth it. (It sometimes is.) I am willing to look and consider the purchase, but nobody is showing. Wonder why they don't sell product? Duh!
Currently I don't download anything. Thought I would make the change and see what happens with me and my family.
I must say that without P2P, I am missing out. All the radio stations here play the same (crap) music. There is little to get excited about. I know there is a lot of music that I would be interested in buying, but I can't find it easily!
P2P is costing the RIAA something in the young market though. If they (kids)have the money they will buy the CD, even if they have downloaded it. But if they have a (better) choice they won't. These days there are more good choices, so kids buy fewer CD's because they know they can get the music somehow later, but can't easily repeat a spur of the moment movie trip. So, the RIAA is losing sales here in my view. In a twisted sort of way, they might be right with the younger crowd. They can squeeze more out of their latest boy band if there is less P2P, but at what cost?
On second hand they might already be hosed. When I shut down the P2P, my kids ended up doing the same thing I did. They go to school, talk about the music, find out who has it and why, and copy it if it fits.
There are more CDRs laying around the house now than when P2P was running.
Now, I do get excited about movies and guess what? That is what I buy. The movie market appeals to everyone at some level. There are several layers to the whole thing that make it easy to sell to those looking to buy that music just does not have today.
The RIAA is currently trying like hell to milk everything they can from the kids. (Remember the point earlier about cost?) Problem is that those same kids also have DVD, subscription TV, cell phone plans and other new things to worry about. With all those new choices offering different values, is it any wonder CD sales are not as attractive given their low value proposition in comparison?
Your average teenage girl can get a cell plan for the cost of many CD's that will provide way more bang for the buck than that CD will...
I think the RIAA is getting squeezed right out of their prime market because of these things and their own ignorance.
Now here I am sitting with my disposable income looking for something to buy. Does it take much of a stretch to see that I am going to buy something from those people willing to entertain my business?
Whatever problems the the movie companies have with digital are not getting in the way of moving product. They are showing me lots of pricing options, good content and good value across the board. I can easily find blockbusters along with interesting smaller films.
What do I get on the music side of things?
Shit.
The majority of the content is aimed at people half my age. I cannot realistically sample using the radio because they are all but owned by the big boys, so they mostly play the same things. Going into the music store to sample is a joke really. All they do is put the same tracks on the in-store boxes that I just got d
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