Music Piracy All at Sea

In 1999, a nineteen-year old student decided he wanted a fast and efficient way to share his favorite songs with his friends. But, he didn’t just want to make them compilations tapes on cassette. He wanted to do the sharing via the computer. The result was Napster. A file sharing community that allowed Shawn Fanning and his friends to share all the mp3 files they ripped from their CD collections with each other…and 60 million other users.

The rest would be history, if it were not for one small issue – what they were doing was illegal.

At first, that stopped no one. Napster clones with marginally different peer-to-peer client-server architectures appeared. Gnutella networks, eDonkey, AudioGalaxy, Kazaa, FastTrack, Grokster, Limewire, Morpheus, BearShare, and countless others emerged totaling hundreds of millions of users sharing billions of megabytes of files. Add to that Usenet binaries and ICQ/IRC channels through which music, video, software, and other copyright materials had already been shared illicitly for years. This, was still years before the advent of BitTorrent networks.

Although figures have shown repeatedly that the rise of Napster and its ilk had actually caused a resurgence in lackluster CD sales, many users download lots of tracks but then buy the complete album on CD for the sake of having something more tangible to own. The whole file-sharing culture has also, it is claimed, boosted interest in music in much the same way that video piracy in the 1980s saw more people going to the cinema.

Nevertheless, it was inevitable that the copyright holders were going to be a little less than pleased with P2P. With support and advocacy from certain artists themselves, most notably Metallica’s Lars Ulrich and Dr Dre, the record industry began to fight this cultural sea change. Napster was shut down under court order and many of the other early P2P systems followed. However, others sprang up to replace them almost as quickly as others were knocked down. The development of BitTorrent has added a whole new approach to file sharing veiled with a layer of legitimacy.

In the meantime, more savvy agencies, namely Apple Corp and a Russian site going by the name of Allofmp3.com, as well as a few other innovators, had latched on to the fact that mp3 downloads, despite the fears of the wider industry would be the way forward. The difference between these paid-for downloads (allofmp3’s dubious international legality aside) and the original incarnation of Napster is that users had to pay and royalties were apparently passed on to the record companies, and one would hope, the artists themselves. Ultimately, the Napster name was resurrected as a paid-for service endorsed by the record industry and others followed suit.

At this point in download history, there exist paid-for services such as Apple’s iTunes, Walmart.com and BuyMusic.com, Real Rhapsody and the successors to Allofmp3, MP3Sparks and AllTunes (which are still possibly of dubious legitimacy but offer much cheaper downloads than most of the Western companies) and of course dozens of P2P file sharing systems, including the Gnutella system and the vast numbers of BitTorrent users and the torrent search sites like The Pirate Bay that service them. So, there is a mix of legal, possibly illegal, and most certainly breaking copyright law sites and systems.

The Record Industry Association of America (RIAA) has chased after illegal file sharers and had some successful and some failed suits against many. But, there are millions of downloaders and dozens of “offshore” internet sites to host the necessary search systems and hash files to allow P2P downloads.

Writing in the International Journal of Electronic Finance this month, Alan Smith of the Department of the department of Management and Marketing at Robert Morris University in Pittsburgh, PA, asks which will prevail – pay sites or piracy? “There is much controversy concerning the issue of music piracy over the internet and the implementation of new information technology,” he says, and points out that there has been a growing acceptance of paid-for downloads in the user community. But, downloading free music today, is he emphasizes, just as popular as it was when Napster was first fired up to allow people to swap music for free.

One reason it is still so popular is because it is quicker to download software on a file-sharing program, rather than driving to a store and physically buying it. The P2P option also displaces what is essentially theft in the eyes of the law it stands in most Western countries.

However, there is an ethical side to the argument on the side of the P2P users. “Record companies have traditionally fixed music product prices to avoid competing with each other and to maximize their profits,” Smith argues. It is perhaps not surprising that music lovers have taken up against this perception of self-serving corporate greed that does not apparently provide an equitable arrangement for the majority of employed artists, with obvious big name exceptions; most artists receive less than 10% of royalties on CD sales and iTunes downloads (Of course, that’s 0% for illegal downloads).

More to the point, not all musicians wanted to see an end to Napster and its ilk. Many wanted Napster to remain online so that their music could be heard. This was an especially common thought among smaller bands and artists. Governments are going to have to take some rather draconian and inevitably unpopular measures to close down all illegal file sharing systems. But, even then, just as successor after successor emerged following the Napster debacle those who want to find a way to get downloads for free will find a way. Perhaps the record industry needs to reinvent its out-moded business model which still hinges on the record store approach and attitude. Maybe they will find a profitable approach to music sharing that is equitable for artist, company, and music fan alike.

UPDATE: The European Union has decided to invest millions in the development of an open-source BitTorrent client. It’s a quite bizarre happening, it turns out that the Greens – (42 seats in the European Parliament) have been campaigning for fair use of P2P file-sharing technologies for ages, arguing the toss over copyright and IP issues etc and this is the final outcome. Cost will be some $22million, which is about 15m euros.