It is still very difficult to make a living as an artist, it always has been, and it always will be. But at least it has become a little bit easier than it was before the Internet and p2p file sharing. In the music business, total revenues have increased slightly, while the big record companies are getting a smaller piece of the pie. This has left more money for the creative people who actually make the music (rather than just distribute it).
File sharing is not a problem that needs to be solved. It is something that is positive for both artists, consumers, and society as a whole. All we need to do now is to get copyright legislation in line with this new and positive reality.
By reforming copyright to legalize p2p file sharing that is done without direct commercial intent, we can put an end to the criminalization of an entire generation, while at the same time improving conditions for a vibrant cultural sector in Europe.
Studies On The Cultural Sector In The File Sharing Era
There is quite a lot of academic research on how the cultural sector, including the music business, has fared in the file sharing era. These studies make very interesting reading, and should be obligatory reading for all politicians involved in copyright policy making.
First, three studies on the music business in various member states:
• UK 2004 – 2008 : Record companies lose, artists gain from file sharing
• Sweden 2000 – 2008: More Charts The Record Labels Don ’ t Want You To See: Swedish Musicians Making More Money
• Norway 1999 – 2009: Artists Make More Money in File-Sharing Age Than Before It
All three studies conclude that although record sales are down, revenues from live performances have increased dramatically, in a way that more than compensates for the drop in sales of recorded music.
The Dutch study Ups and downs – Economic and cultural effects of file sharing on music, film and games (2009) takes a combined look at different cultural genres. It shows that between 1999 and 2007, revenues have increased for all of them, except music recordings. For the music industry, this study only looks at recorded music, and does not examine income for artists from other sources, such as concerts. This means that the study only confirms the negative trend for recorded music in line with the Swedish, Norwegian, and UK studies above, but leaves the part of the music sector that has made up for this outside the scope of the study.
A Harvard study from 2009 takes a look at the wider implications of file sharing for society, and finds that since the advent of file sharing, both the number of music albums and films released per year have increased. Canadian law professor Michael Geist summarizes the study under the heading Harvard Study Finds Weaker Copyright Protection Has Benefited Society.
The Hargreaves report was commissioned by the UK government, and published in May 2011. It makes a strong call for evidence-based policy making in copyright matters, as opposed to having policy determined by the weight of lobbying.
Although the report is by no means a “Pirate Manifesto”, it makes several concrete proposals for policy changes that would at least go in the right direction.
The studies that have been mentioned here are summarized in a little more detail in the following sections.
UK 2004 - 2008: Record Companies Lose, Artists Gain From File Sharing
Above you find “The graph the record industry doesn’t want you to see” according to Telegraph editor Shane Richmond.
Times Labs has made an analysis of the music market in the UK for the last five years, based on data from the UK collecting society PRS.
In the graph, the top field is what the record companies make. The four other fields are what the artists make. The conclusion is very clear:
Record companies are making less, artists are making more, and the total amount is constant.
The reason record companies are making less money than they used to is probably due to file sharing. We Pirates happy to concede that. File sharing is a much better way to distribute music, so the service that the record companies provided is less and less in demand. It is only natural that they are in decline.
The best thing about this, is that the artists are making more money. People are spending just as much as they used to on music, but the record companies are getting less. Instead, the artists have increased their share to soak up the money that has become available.
This is an excellent development, and something we should embrace. File sharing should be legalized. The artists are the ones who have the most to gain.
Sweden 2000 – 2008: More Charts The Record Labels Don’t Want You To See: Swedish Musicians Making More Money
Mike Masnick at Techdirt writes:
We’ve already discussed the research on the UK music industry that shows both that live revenue is more than making up the decline in recorded revenue and that musicians themselves are making more revenue than ever before. Some people have suggested that this is a UK-only phenomenon, but a worldwide study found the same thing as well. And, now it looks like the same is being found in Sweden as well – home of The Pirate Bay, which we keep being told is destroying the industry. Swedish indie record label owner Martin sends in the news on data from the Swedish music industry, which looks quite similar to the UK data. First, it shows that while there was a tiny dip in overall revenue, it’s back up to being close to it’s high, mostly because of a big growth in live music:
Basically, recorded revenues dropped. Collections stayed about the same, but live grew. More importantly, though, is the second chart, which shows the revenue for actual musicians. And that’s going in one direction: up.
And yet, The Pirate Bay is destroying the ability to make music, right? Funny that the numbers don’t seem to support that at all. Basically, these charts are showing the same thing that those other studies have shown. More music is being created. There is greater “discovery” of new music. There are greater revenue opportunities for musicians, and the only part of the business that appears to be suffering is the part that involves selling plastic discs. Yes, that sucks if your business was based on selling plastic discs, but for those who can adapt and adjust, there is more money than ever before to be made. That sorta goes against the claims that “piracy” is somehow destroying the industry, doesn’t it?