Tuesday, April 20, 2010

Unexpected Harmony


The flames of music piracy purportedly eating at the music industry are not untamable. Although glancing at the cover of the February 2003 issue of Wired Magazine, one may think otherwise:
In the piracy debate today, electronic distribution is at the forefront, having cut into labels’ profits much more than the ripping and burning of CDs, referenced on the WIRED Magazine cover. You may already be aware that the mass dissemination of music over internet networks was made possible by the innovation of the .MP3 compressed audio file format and the creation of Peer-to-Peer (P2P) file-sharing networks. The first P2P network was called Napster, created in 1999. Although the onset of music piracy would appear to lead to homogeneity within the popular music industry, heterogeneity is the actual product of music piracy as P2P file-sharing has become a tool for promoting new music. It is quite an unexpected harmony.

The structure of P2P file-sharing intuitively seems to preserve homogeneity by only promoting well-known artists. For those who aren’t familiar with this process, P2P file sharing involves both downloading and uploading parties: once a person downloads a complete file from others online, he (the archetype of a music pirate is a teenage male) automatically becomes capable of uploading that file to others in the community. Search engines within P2P software prioritize tracks for download based on the number of people currently downloading and those who already have the complete file for uploading purposes. Moreover, the increased popularity of a track is directly related to increased download speeds. Therefore, if an artist or specific track already has a large audience, it will benefit from the majority of the P2P community’s attention. This suggests that P2P file-sharing widens the gap between major and minor artists by filtering and promoting in favor of the already well-established artists. However, the industry has managed to overcome this side-effect of P2P file sharing. I looked at the rap industry in particular to demonstrate this idea.

There is a positive correlation between the rise in piracy and the diversifying trends we see in artists within the hip-hop industry. From 2000 to the present, the number of main and featured rappers represented in the Billboard Top 100s has increased by over 400%(5-26 unique rap artists represented). Addressing the argument that the increased number of rap artists within the mainstream charts to the rising popularity in rap music in general, it is important to note that the first rap song to enter the mainstream charts was over thirty years ago, appropriately entitled “Rapper’s Delight” by The Sugarhill Gang. Until 2000, and until the onset of music piracy, the number of unique rap artists represented in the charts has been below five. It is clear that something happened in 2000 that flipped a switch. That something was piracy. The observed trend in diversification today is not limited to the number of unique artists.

Piracy has also positively influenced the variation in labels within the charts. The major labels, namely Sony, BMG, Universal, EMI, and Warner Brothers account for over 75% of music sales. These powerhouse labels have basked in considerable control over the recording, distributing and promotional aspects of the popular music industry. A study conducted in June 2005 examined the influence of sharing technologies on the market. The study provides data before and after rise of P2P sharing networks. It was found that the rise in piracy had a negligible impact on the chart-survival of low-ranked albums on the Billboard Top 100s (the lower the indicated rank, the more popular). However, after the onset of music piracy, the gap in survival times of albums associated with major labels and those associated with minor labels was made smaller. The implication of this is that minor labels are somehow benefiting from increased exposure, directly or indirectly due to piracy. 

Music piracy will not kill the music industry, although you have probably heard otherwise. To the contrary, it is contributing to its diversified vibrancy. The blimp may be on fire, but heat rises as the industry is currently showing us.

No comments:

Post a Comment