Spotify has long argued that it isn’t killing music sales, but is rather reducing piracy — and the company now has some numbers to back that claim up: This week, Spotify published a report that shows that piracy in the Netherlands has gone down just as Spotify has become more popular in the country.
The report is authored by Spotify’s director of economics Will Page, who joined the company last fall and previously worked as a well-respected economist for the British collecting society PRS for Music (hat tip to TorrentFreak).
Spotify launched in the Netherlands in 2010. Check out how music piracy has changed in the country over the last few years, and compare that to other types of piracy:
What’s more, Page was able to highlight how artists who have their music on Spotify see significantly less piracy — and as a result actually more record sales — than artists who don’t distribute their music over the service. One Direction is one example of a band embracing Spotify. Check out the chart below, visualizing how the band’s music did on Spotify, BitTorrent and traditional distribution when it released its album Take Me Home in the Netherlands in 2012:
Now compare that to Rhianna, whose album Unapologetic was released one week later, but didn’t appear on Spotify for a couple of weeks:
The report goes on to compare piracy levels in the Netherlands with Italy, where piracy is still much more pervasive. Spotify only launched in Italy this year, and Page’s take is that the company could have a similar effect on piracy there as it had in the Netherlands. However, income levels in Italy are also much lower, and going down:
It remains to be seen whether Spotify can really fight piracy everywhere, or only in places where people can actually afford to pay for music.
Source: paidContent (by Janko Roettgers)
Here’s where the war on piracy gets really complicated. Because for all the ‘just embrace it’ advice from the tech community, it seems that shutting down massive piracy hubs actually improves digital sales. You need an attractive carrot…
…and a giant stick as well. It was true for song downloads following the shutdown of Limewire, and now, there are statistics backing the Megaupload shutdown, as well. ”The shutdown of Megaupload caused a statistically significant increase in digital sales,” Carnegie Mellon professor of information technology and market Michael Smith recently told an audience last week at the Digital Book World Conference in New York.
According to details from MediaBistro, Smith analyzed and compared countries with varying degrees of Megaupload penetration (low, medium, high). And after crunching the numbers he determined the following result:
"It does suggest that when you look at competing with free, using anti-piracy measures to make piracy less attractive does work," Smith said. Perhaps the more important questions are how long the effect lasts, and whether it was worth the effort. Limewire took years and millions of dollars to shut down (and let’s not even get into the costs of the Megaupload takedown).
And sometimes, shutting down one massive piracy hub merely creates a void for another to fill. In the case of Megaupload, Kim Dotcom is now filling that void himself.
Source: Digital Music News
NEWS: Music Pirates Buy 30% More Music than Non-Pirates
It’s not what you would expect from file-sharers, a.k.a. “music pirates,” but apparently according to American Assembly, those who share files illegally buy 30% more music than those who don’t share music. At first glance, it’s pretty surprising to think those who break the law and steal music pay more for music than those who don’t steal, but it makes more sense upon further review.
People who file-share in large amounts are passionate about their music, but also share a libertarian psychology. They don’t think music needs to be controlled by anyone, and it should be free for all to listen to. However, it’s more surprising that people who don’t regularly download and share illegally also don’t buy music as much. So those who don’t consume or buy as much, probably aren’t as passionate. If these non-passionate music fans were more interested, they’d probably illegally download than purchase, right? So maybe this study says less about music fans as a whole and more about what drives music piracy; passion.
Of course, we already knew this. Music pirates get a bad rap and what they do is technically illegal, it’s easy to forget they’re not bad people and simply can’t help tapping into the loopholes of the web. They love their music, and it’s the environment that’s to blame.However, it’s an awkward position for artists who connect with their fans, since a huge chunk of a diehard fan base probably doesn’t give any of their money to that band.
DEBATE: Will We Ever Return to the Days Before Mass Piracy?
The most entrenched cynics will say “Ha! Um. No.”
Most would argue the culture of piracy is too deeply interwoven into music culture today. Sound point. However, a lot has changed with music consumption as of late. Streaming has rivaled downloads, illegal and legal, and this is the key detail that might eat away at piracy. Unfortunately, streaming is still slow to find fair royalty rates with labels and musicians.
When there are so many easy cheap/free streaming outlets, music pirates aren’t as incentivized as they used to be. With the massive growth of streaming services and time for the culture to heal itself and embrace them, music consumers could be programmed to limit the piracy.
In the end, it’s hard to imagine any form of technology stopping piracy. It’s a floodgate that can only be reduced in size, but not sealed altogether. Music tech gurus don’t bother trying to stop it, but find ways to adapt and work around it. No, we won’t return to the days before piracy, but hopefully someday, culture will embrace a compromise that makes most sense to them and the musicians making the music.
What is going on here? Why are there more news stories about artists supporting piracy brands like with Kanye West and Swiss Beatz buddying up with MegaUpload? Now, dubstep DJ Pretty Lights is signing on with BitTorrent! Granted, Pretty Lights is notorious for being anti-music industry, but this is a bit cannibalistic.