The Case for Copyright Reform (11 page)

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?

Norway 1999 – 2009: Artists Make More
Money In File Sharing Age Than Before It

Ernesto at
Torrentfreak
writes:

An extensive study into the effect of digitalization on the music
industry in Norway has shed an interesting light on the position of artists
today, compared to 1999. While the music industry often talks about artists
being on the brink of bankruptcy due to illicit file sharing, the study found
that the number of artists as well as their average income has seen a major
increase in the last decade.

Every other month a new study addressing the link between music piracy
and music revenues surfaces, but only a few really stand out. One of the most
elaborate and complete studies conducted in recent times is the master
thesis
of Norwegian School of Management students Anders Sørbo and Richard Bjerkøe.

In their thesis, the students take a detailed look at the different
revenue streams of the music industry between 1999 and 2009. By doing so, they
aim to answer the question of how the digitization of music – and the
most common side effect, piracy – have changed the economic position of
the Norwegian music industry and Norwegian artists. The results are striking.

After crunching the music industry’s numbers the researchers found that
total industry revenue grew from 1.4 billion Norwegian kronor in 1999 to 1.9
billion in 2009. After adjusting this figure for inflation this comes down to a
4% increase in revenues for the music industry in this time period. Admittedly,
this is not much of a growth, but things get more interesting when the research
zooms in on artist revenue.

In the same period when the overall revenues of the industry grew by
only 4%, the revenue for artists alone more than doubled with an increase of
114%. After an inflation adjustment, artist revenue went up from 255 million in
1999 to 545 million kronor in 2009.

Some of the growth can be attributed to the fact that the number of
artists increased by 28% in the same time period. However, per artist the
yearly income still saw a 66% increase from 80,000 to 133,000 kronor between
1999 and 2009. In conclusion, one could say that artists are far better off now
than they were before the digitization of music started.

Aside from looking at the reported revenue, the researchers also polled
the artists themselves to find out what their income sources are. Here, it was
found that record sales have never been a large part of the annual revenue of
artists. In 1999, 70% of the artists made less than 9% of their total income
from record sales, and in 2009 this went down to 50%.

Live performances are the major source of income for most artists. 37%
of Norwegian artists made more than 50% of their income from live performances
in 2009, up from 25% in 1999. That said, it has to be noted that only a few
artists make a full living off their music, as most have other jobs aside.

In conclusion, the study refutes some of the most common misconceptions
about the music industry in the digital age. Musicians are making more money
than ever before. It is true that the revenues from record sales are dwindling,
but that can be just as easily attributed to
iTunes as The
Pirate Bay
.

The bottom line is that the music industry as a whole is thriving.
Record labels may report a dip in their income from record sales, but more
money is going to artists at the same time. Is that really such a bad outcome?
Well, that depends on who you’re listening to.

Dutch Study: Ups And Downs – Economic
And Cultural Effects Of File Sharing On Music, Film And Games (2009)

Mike Masnick
at
Techdirt
writes:

[This study] is a very long (128 pages), but very thorough research
report analyzing
pretty much
everything having to do with file sharing in the Netherlands
,
commissioned by the government. It studies the economic angles, the legal
angles, the cultural angles – and then compares the local results to
international results.

While you might quibble with some of the methodology here or there, the
overall conclusions of the report are pretty strong and clear: file sharing is
not a problem for the overall industry. File sharing has, in fact, created a
net benefit to the economy and society in both the short and long term, and
that will likely continue.