The internet has had a big impact on the workings and revenue of the music industry. It has forced the industry to change and adapt (Blethen). These changes have had both positive and negative effects on the music industry, effecting all people within the business (Mansfield). Some people share the opinion that the industry having trouble and is in turmoil (Sloan). Others think that the internet has helped the industry with its growing success and will only make it better (“A Change of Tune; The Music Industry”). The internet has influenced the music industry by making piracy easier, creating online radio, creating new customer advantages and creating some company disadvantages.
The internet has drastically increased piracy problems with the music industry by making it much easier. Piracy has easily had the biggest impact on the music industry because of the internet. Piracy is defined as illegal music theft (Graham, “Music industry finds new beat”). The best description of music theft comes from the Recording Industry Association of America (RIAA):
Music theft can take various forms: individuals who illegally upload or download music online, online companies who build businesses based on theft and encourage users to break the law, or criminals manufacturing mass numbers of counterfeit CDs for sale on street corners, in flea markets or at retail stores. Across the board, this theft has hurt the music community, with thousands of layoffs, songwriters out of work and new artists having a harder time getting signed and breaking into the business. (Piracy: Online and on the Street) These mentioned illegal downloads are now at an all time high. Forty-three percent of people worldwide now download music illegally (Mansfield).
Piracy is made easier by online file sharing companies. File sharing companies allow people to share music on the internet. Although these companies say not to download copyrighted materials, they still allow them to be. An example of a popular file exchange program with many users is Limewire (“www.limewire.com”). Limewire costs nothing and takes minutes to download (“www.limewire.com”). Another file sharing program is Kazaa (Graham, “Ruling sets back music industry's”). Like Limewire, Kazaa is also free. The only revenue that these companies offer to the music industry is through lawsuits, which can last for many years.
Piracy has a huge effect on companies that record, produce and distribute music. Record Companies blame music piracy for the decline of the music industry (Gundersen). In 2005 the industry lost more than 300 million dollars because of sales of illegally copied discs (Bridis). Earlier, in 2003 CD sales went down 8.3% and have since then declined (Gundersen). Last year, there was an 11% decline in worldwide music sales because of piracy (Mansfield). This information made 2007 the worst year for the music industry in over 25 years (Mansfield).
Next, it is only fair that we talk about the effect of piracy on the people who create the music. How does piracy effect artists? Similar to the companies that produce the music, artists are also losing money because of piracy (Mansfield). Artists are now figuring out new strategies to deal with piracy (“The end of music?”). They are boosting concert ticket prices and having more shows (“The end of music?”). “Some musicians are happy to turn a blind eye to illegal downloads, it seems, as long as they are able to satisfy the publics appetite for live music”, says Dan Cryan, an analyst with Screen Digest (Mansfield). That quote was from an expert who believes that some artists do not let piracy effect them by making money off of concerts. The top 35 pop artists now earn a large portion of their money from concerts, instead of recordings (“The end of music?”).
Piracy also has an affect on the consumers. It affects both the people who follow the rules by purchasing music legally and the...