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The Economics of P2P File-Sharing
brajesh writes "Does P2P file-sharing really affect music sales and in what ways? According to a blog entry at "The Long Tail", a paper from David Blackburn[.pdf], a Harvard PhD student, on the economics of P2P file-sharing concludes that it does indeed depress music sales overall. But the effect is not felt evenly. The hits at the top of the charts lose sales, but the niche artists further down the popularity curve actually benefit from file-trading. Form the paper - "Artists who are unknown, and thus most helped by file sharing, are those artists who sell relatively few albums, whereas artists who are harmed by file sharing and thus gain from its removal, the popular ones, are the artists whose sales are relatively high." But then "File sharing is reducing the probability that any act is able to sell millions of records, and if the success of the mega-star artists is what drives the investment in new acts, it might reduce the incentive to invest in new talent. This is, at its heart, an empirical question which is left to future work." There is also another compilation of studies on economics of P2P."
When the rest of the 'food chain' below her benefits, who cares if the one at the top, with more then they need anyway, misses out on a few potential sales.
Remember, *nothing* was stolen during the p2p transaction, so she didnt actually *lose* anything, it is only a reduction in the vague concept of 'potential' ( i.e. unprovable ) sales.
---- Booth was a patriot ----
I particularly like the Fairshare proposal floated by Ian Goldberg, in which you could "invest" in promising new artists. It gives incentive to get in on the ground floor with a little-known artist, rather than to ride the coattails of a megastar.
Any alternative would be better than the current system.
Without the labels as middlemen who shift 90% of the overall revenue into overhead costs, artists would need little if any outside "investment". Now that publishing music no longer technically requires centralized control, the industry should move to a system where artists do direct online sales through independent low-overhead sites. Instead of signing their copyrights over to middlemen, they would hire them as needed. In this new efficient market, the artists will make far more money, and the music will be much cheaper for consumers to buy.
Talking about not hearing the other sides argument. The point is that small artists don't *need* a record label any more. So we don't care how they invest their money - except that suing grandmothers doesn't seem like the best use.
We also have the classic "free" vs. "free" equivocation. I don't want to get music for free. I want to support the artist. But I much prefer to buy albums directly from the artists. And I hate stupid restrictions. "Liberian Acapella" is one of my favorites. They sing at churches and sell their self produced albums. I have many albums from Magnatune (a "record label" that does distribution only). Another favorite is David Bellugi from Italy.
That said, I am a copyright Nazi. I confiscate and destroy illegally copied RIAA music whenever I find it, give my teenage daughters a lecture on "playing by their rules if your going to listen to their music", and threaten to take the $3000 out of their bank account if they get caught distributing copies (I realize the lawsuits are for online distribution, but the principal is the same). Of course, the fact that I can't stand most of the music has *nothing* to do with this...
What I really need is some official RIAA materials on copyright violation, so that we can be clear that the copyright Nazi thing is part and parcel of RIAA music, and not something I am making up.
So, teen pop shiiat loses sales, but real musicians find their audience with P2P. No wonder the RIAA hates it. You can't snooker people who get to try before they buy. P2P makes it much harder to rip off children, which has been the recording industry's MO almost since Edison invented the phonograph. Don't buy CDs!
How ya like dat?
Well, socialism has been taken to mean many things (I feel like pulling up "civics" from Civ4). In particular, there is a social model, an economic model and a government model. The social model means that the state will provide universal healthcare and other social benefits to people that are unemployed, invalid and so on. I suppose you may call this "mommy and daddy providing for needs", economically on the basis that is it ultimately more productive for society to have people healthy and returned to the workforce even though they can not afford the treatment, and morally on the basis that everyone should be entitled to some minimum standard of living regardless of their ability to provide for themselves. You'll find that most of Europe believe quite strongly in this model.
The economic model with state-controlled and protected industry has for the most part been abandoned as a general principle, but not entirely. Many countries have some form of public transportation, public utilities and so on that are state-owned, because it is considered easier to socially optimalize it as owners than to regulate them as monopolies. For example, it is usually better for society as a whole to have more public transportation than is economically optimal for the transport company (less pollution, less congestion, less public roads to build and maintain and so on). They have for the most part been exposed to competition, but service goals and such maintain the social goals. Even China has pretty much abandoned socialism as an economic model in favor of a market economy.
Socialism is also a government model, where "the people" are in charge and thus there is no need for any other party. The basic lines of Marx that each worker should be represented in government, is more like a form of direct democracy than the one-party model that became the mark of communism. You also need to separate between the actual and formal government model. As an example, many parts of Europe have kings, queens but are still democracies. Just like the "People's republic of China" isn't much like a democratic republic.
As far as the rethoric against the RIAA goes, it sounds pretty socialist to me. It's all about how the captialists (RIAA) are exploiting the workers (artists), and how they should revolt and form some sort of people's republic (no large capitalists) where the workers (artists) all get their share of the profits. Let us assume that everyone trades by p2p, and music industry as we know it today crumbles. What do you see? In the old days, artists and composers were sponsored by kings and rich men. I think an new generation of "superstars" would appear, corporate shills sponsored by large corporations with massive promotion budgets. It would not matter if they are spread around because they are nothing but concealed corporate propaganda. That is the fallacy of most revolutions, the average man has rarely come to power. More often than not, he has simply paved the way for another master to take the same place.
Live today, because you never know what tomorrow brings
If you are doing well enough for trading to hurt... You're doing well enough.
Why should 90 percent of the revenue go to ten percent of the artists.
Here's to the musical middle class
It always seemed that copyright lengths should be getting shorter, not longer. After all the pace of commerce has increased.