Can Innovation Through Business 'Solve' Issues That Legal Repression Can't?

from the making-music-worth-paying-for dept

If you follow music industry news, you probably didn't miss Spotify's launch in the US last week. Prior to this launch, a Swedish music executive was interviewed about what to expect when Spotify launches in the US. One part of the interview stood out in particular:
[Spotify] has eradicated music piracy almost on its own. Sweden was the home of Pirate Bay. They even had their own political party and made the prime minister in national television declare "Off (sic) course the youth shall be able to download music for free".

Three years later, The Pirate Bay is not mentioned by anyone anymore. Spotify is, on the other hand, mentioned by almost everyone - including the old Pirate bay fans.

This did not happen because some new radical law or brutal police force were implemented. Neither because a confused prime minister changed his mind again and embraced the music industry. It all happened simply because the users found a new legal service that they actually thought was much better than the old Piracy one.
What is interesting here is that innovation through business helped reduce 'unauthorized consumption' of music, while many a record label exec prefers to invest in legal changes that have not really made all that much impact so far. Personally, I think the recording industry missed a huge opportunity 10 to 15 years ago. Instead of using the legal system to fight Napster and the wave of peer-to-peer filesharing that followed, innovation through business would probably have been more worthwhile (and a lot less costly). Besides that, legal changes on the scale some of the folks in the recording industry envision would create a market that's even more broken than it already is, preventing other business (like Spotify) from driving innovation and competing in their industry, and would be threatening to civil rights (the rights to free speech and privacy in particular). Enforcing the interests of one group or industry by sacrificing innovation and civil rights surely must be one of the most undesirable things we as a society face today.

Even though Spotify displays a good model for success, it does have its drawbacks. One rights organization highlights an important issue with Spotify: the inability to port data.
Because streaming customers do not own their music, they cannot take it with them. Should they decide to try another service (or if a service goes under), users should be able to easily export titles of songs in playlists they created or a list of favorite music, etc. Users should also be able to choose independent add-ons that make the service more valuable, such as alternative means of organizing their music "collections." Without this kind of functionality, users are going to be disappointed, and we are unlikely to see the real competition that helps drive innovation.
The content industry is a volatile industry. Only two years ago MySpace bought imeem (the first platform in the US licensed by all 4 major labels) and shut it down the same day, replacing all playlists with ads. For this reason owning copies of music, whether through legal downloads or unauthorized alternatives, will stay attractive. As a matter of fact, according to the music exec mentioned above, digital sales in Sweden were up 17% last year compared to a mere 3% growth in the US.

We're only just entering the digital age. Blocking innovation with legislation and lawsuits is a shortsighted approach, especially with innovation proving to solve issues that legal changes can't. If the recording industry doesn't live up to their responsibility to innovate and service their fans, others will.

That's how business works.


Reader Comments (rss)

(Flattened / Threaded)

  •  
    identicon
    Anonymous Coward, Jul 19th, 2011 @ 7:24pm

    Innovation can only happen through monopoly rents and frivolous lawsuits. Without lawyers and corrupt politicians, who would innovate?

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    Anonymous Coward, Jul 19th, 2011 @ 7:41pm

    Doesn't the statement "has eradicated music piracy almost on its own" seem a little bit out there to anyone? Techdirt usually does a good job of jumping on something like that but they seem to have glossed over it on this article.

     

    reply to this | link to this | view in chronology ]

    •  
      identicon
      Anonymous Coward, Jul 19th, 2011 @ 9:23pm

      Re:

      Yeah, that jumped out at me before, but I mostly blame it on the non-regular writer. It obviously hyperbole, but the fact that a music exec. is saying it is rather amusing..

       

      reply to this | link to this | view in chronology ]

  •  
    identicon
    trish, Jul 19th, 2011 @ 7:55pm

    the copyrighters

    im sure these societies who spend so much money on futile legal strategies dont do out of an honest desire to make more money. They do it out of a sense of entitlement so profound that they are willing to self-destruct while brining down their foes, if necessary. It's important to them not to find a way to suit the consumer's needs to get paid for the content. They just want to produce the content and get handed a big check, and then they want to dictate how we should get to consume it. I think they have blinded themselves, otherwise intelligent business-people, to the fact that there was a better way than to retaliate with attacks.

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    Anonymous Coward, Jul 19th, 2011 @ 7:55pm

    The music industry has done a real good job of shooting themselves in the foot. I wonder if there is anything left of the armpits at this point, having finally replaced the foot as the lowest part.

    Wherever you look and listen, this industry and it's pet talking puppets have done it's absolute best to alienate it's customers. Listen to radio once in a while. The playlist is an hourly repeat. Nothing new, not tightly controlled by the majors is ever heard. That avenue for inspiring purchasing by hearing something you haven't heard before is out.

    Commercial channels on the net are no better. I can find plenty of places to listen to great music, it's just missing for the majors, unless you go to the right places. If you do that, anything out there that's been made and still available is likely to be found. Even stuff that's out of print and no longer sold. From the 40's on up through modern stuff, things I can't buy in the store are available as an unmet and unserved market.

    As long as the market is tougher for finding those rare items and for ease of use, it will have the better model in place. Right now, the majors aren't in that running; at all.

     

    reply to this | link to this | view in chronology ]

  •  
    icon
    Capitalist Lion Tamer (profile), Jul 19th, 2011 @ 8:06pm

    The music industry has done a real good job of shooting themselves in the foot. I wonder if there is anything left of the armpits at this point, having finally replaced the foot as the lowest part.

    In this dramatic reenactment, the recording industry is portrayed by Dr. Cooper's dad (Kevin McDonald):

    http://www.youtube.com/watch?v=9GLtH1fk5DI

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    TDR, Jul 19th, 2011 @ 8:07pm

    I'll just quote C.S. Lewis here from The Magician's Nephew:

    "Now the trouble about trying to make yourself stupider than you really are is that you very often succeed."

    The MAFIAA, their pet politicians, lobbyists, lawyers, and the trolling shills they pay to show up here have perfected that to an art form.

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    out_of_the_blue, Jul 19th, 2011 @ 8:08pm

    Complete rebuttal to "a Swedish music executive":

    http://thepiratebay.org/recent

    On the whole this is disjointed ramble: are you now claiming along with this "executive" that Pirate Bay has gone away, and so too will recording industry efforts to implement draconian controls? That a PAID music system is somehow the answer to "piracy"? When are we going to get "free" music because their "marginal cost" is zero?

    I particularly like the touch of specific figures for "percentage proof": but even if "digital sales in Sweden were up 17% last year compared to a mere 3% growth in the US", it's may only a one-year anomaly, and the absolute numbers of the US far exceed those of Sweden.

     

    reply to this | link to this | view in chronology ]

    •  
      icon
      Jay (profile), Jul 19th, 2011 @ 8:37pm

      Re: Complete rebuttal to "a Swedish music executive":

      ...

      Just give me strength to pray for the random thought that come out of this blue character.

      For he does not understand the difference of having a legal service that people can turn to, as compared to those "rogue sites" that make others money.

      Yes, my brothers and sisters, we must PRAY! PRAY to the one that understands not, what he does! We must PRAY to the gods above for him to understand what we already know.

      We know that piracy is the fault of the industry. YESSAH! We know that piracy doesn't hurt the music business. OH SAY IT AGAIN!

      For WE KNOWUH! That PIRACEEUH! BEGETS PIRACEE! OH CAN YA FEEL IT!

      For my brethren! We know that the industry, cares not for competition, merely for misguided messages of misdeeds!

      Pray for this misguided one brothers!
      Dance and shout for the uninformed sisters!

      For he knows not, what he discusses!

       

      reply to this | link to this | view in chronology ]

      •  
        identicon
        Anonymous Coward, Jul 19th, 2011 @ 8:45pm

        Re: Re: Complete rebuttal to "a Swedish music executive":

        Hallelujah Hallelujah Hallelujah

         

        reply to this | link to this | view in chronology ]

      •  
        identicon
        Nicedoggy, Jul 19th, 2011 @ 10:19pm

        Re: Re: Complete rebuttal to "a Swedish music executive":

        He just wants to join the navy Go West and protect the motherland.

        See Village People - In The Navy.

        Quote:
        Go west, life is peaceful there.
        Go west, lots of open air.
        Go west to begin life new.
        Go west, this is what we'll do.
        Go west, sun in winter time.
        Go west, we will do just fine.
        Go wes t where the skies are blue .
        Go west, this and more we'll do.

        Source: Village People - Go West lyrics

         

        reply to this | link to this | view in chronology ]

        •  
          icon
          Richard (profile), Jul 20th, 2011 @ 1:13am

          Re: Re: Re: Complete rebuttal to "a Swedish music executive":

          No - I think the British football fans version of the lyrics applies to him...

          "The song is also sung by audiences at concerts and at sporting events in the UK to show contempt for poor acts and teams, with the lyrics changed to "You're Shit, and you know you are"."

           

          reply to this | link to this | view in chronology ]

      •  
        identicon
        Nicedoggy, Jul 19th, 2011 @ 10:25pm

        Re: Re: Complete rebuttal to "a Swedish music executive":

        Also modding the Village People - YMCA song.

        "It's fun to hack the R-I-A-A.
        It's fun to hack the R-I-A-A."

         

        reply to this | link to this | view in chronology ]

    •  
      icon
      The eejit (profile), Jul 19th, 2011 @ 11:01pm

      Re: Complete rebuttal to "a Swedish music executive":

      Again, for those of you playing at home:

      The point ->.




















      You->o

       

      reply to this | link to this | view in chronology ]

    •  
      icon
      The Mighty Buzzard (profile), Jul 19th, 2011 @ 11:31pm

      Re: Complete rebuttal to "a Swedish music executive":

      Your English speaking, it's my eye hurt make.

       

      reply to this | link to this | view in chronology ]

    •  
      icon
      PaulT (profile), Jul 20th, 2011 @ 12:40am

      Re: Complete rebuttal to "a Swedish music executive":

      "are you now claiming along with this "executive" that Pirate Bay has gone away"

      The executive says nothing of the sort, and only refers to the Swedish market, not the global market. He's mainly talking about the cultural impact and the local usage of the site, which is interesting as it's the homeland of TPB.

      "That a PAID music system is somehow the answer to "piracy"? When are we going to get "free" music because their "marginal cost" is zero?"

      People aren't paying for the music, they're paying for a useful, non-infinite, service that happens to include legal music. Therein lies the difference.

      "it's may only a one-year anomaly, and the absolute numbers of the US far exceed those of Sweden."

      Absolute numbers are irrelevant when looking at the general impact of a service. Also, I'm sure that future figures will be analysed when they're available. The author's only going on data currently available, which is all that he can do.

       

      reply to this | link to this | view in chronology ]

      •  
        identicon
        Anonymous Coward, Jul 20th, 2011 @ 1:00am

        Re: Re: Complete rebuttal to "a Swedish music executive":

        That's dumb, business cannot beat piracy because piracy means everything is free and you can't make money competing with free.

        Even if you could make money you couldn't make enough.
        Even if you could make enough, it would never be as much as the music industry would get without piracy.

        Even if it was as much as the music industry would get without piracy, it will still fail because some people would probably still be getting stuff for free and therefore would be depriving businesses of revenue.
        If anyone can still get music illegally for free then piracy wins and the music business can only go bust no matter how much money they make.

        I hope this has clarified the situation.

         

        reply to this | link to this | view in chronology ]

        •  
          icon
          PaulT (profile), Jul 20th, 2011 @ 1:46am

          Re: Re: Re: Complete rebuttal to "a Swedish music executive":

          You know, I can't even tell if that's a serious comment from our usual AC or a clever imitation. I suspect the latter, but who knows? Bravo.

           

          reply to this | link to this | view in chronology ]

        •  
          icon
          Bas Grasmayer (profile), Jul 20th, 2011 @ 1:49am

          Re: Re: Re: Complete rebuttal to "a Swedish music executive":

          The bottled water industry.

           

          reply to this | link to this | view in chronology ]

          •  
            icon
            Chris (profile), Jul 20th, 2011 @ 4:09am

            Re: Re: Re: Re: Complete rebuttal to "a Swedish music executive":

            Snap!

             

            reply to this | link to this | view in chronology ]

          •  
            icon
            The eejit (profile), Jul 20th, 2011 @ 6:54am

            Re: Re: Re: Re: Complete rebuttal to "a Swedish music executive":

            I was thinking the vitamin industry, myself.

             

            reply to this | link to this | view in chronology ]

            •  
              icon
              PaulT (profile), Jul 20th, 2011 @ 7:04am

              Re: Re: Re: Re: Re: Complete rebuttal to "a Swedish music executive":

              Yeah, I'm not sure if the AC is serious or just mocking our regular troll. But, if he's serious it's a non-starter anyway. The music industry has been competing with "free" for a long long time and even made it part of their business model. It's called radio.

               

              reply to this | link to this | view in chronology ]

              •  
                identicon
                Anonymous Coward, Jul 20th, 2011 @ 1:10pm

                Re: Re: Re: Re: Re: Re: Complete rebuttal to "a Swedish music executive":

                Radio is paid for of course, by advertisers and they radio stations pay the record companies. So while it is free for the end user, someone is paying and this is the key point for all these copyright enforcement people, there must be someone paying for any listening or viewing.

                But that probably is the most bizarre business arrangement in the world, given that we know that being played on the radio boosts sales.
                Somehow, the record companies, to give them much credit have managed to convince their primary promotions people to pay them for the privilege of boosting the record companies profits.

                It all sounds reasonable enough on the surface.
                Radio station makes money by playing record company product which gets them listeners that advertising companies then pay the radio station for access to. Obviously they are benefiting from record company product and should pay them.
                But once you look beyond the surface,
                we know that record companies benefit from their product being played. We know they benefit so much that on many occasions they were willing to pay radio stations to do so.

                In a business as twisted as this, where artists pay the company for every little thing the company does to benefit both the artist and the company, so that even really successful albums might never "make" more than the advance for the band despite making the record company an absolute fortune, vastly outdoing any money the band can be said to have made from their own work and the radio stations don't just provide free advertising for the product but actually pay the companies for promoting their product, how can we expect these guys to be able to act rationally about anything at all.

                 

                reply to this | link to this | view in chronology ]

        •  
          icon
          Jay (profile), Jul 20th, 2011 @ 4:45am

          Re: Re: Re: Complete rebuttal to "a Swedish music executive":

          "money competing with free"

          Food industry
          Clothing industry

           

          reply to this | link to this | view in chronology ]

    •  
      icon
      Neppe (profile), Jul 20th, 2011 @ 1:51am

      Re: Complete rebuttal to "a Swedish music executive":

      Music industry numbers from Norway - which also has had Spotify for some years.
      http://www.ifpi.no/statistikk/2011/index.htm

      Same month 2010 and 2011
      Physical media sales down 51%
      Digital sales up 228 %

      Total sales same period 2010 and 2011 (January to June )
      Physical media down 37%
      Digital sales up 91%

      Total volume all music 2009 : 505135
      Total volume all music 2010 : 592975

      Volume numbers make a significant jump from ca 19k to ca 55k in 2008 which is right around when Spotify surfaced in the Norwegian mainstream.

      Taking this into consideration mr.out_of_the_blue (I'm assuming that's where you get your 'facts'), I'm going to have to go with "reality trumps ideology" once again.
      So sorry.

       

      reply to this | link to this | view in chronology ]

  •  
    icon
    Hephaestus (profile), Jul 19th, 2011 @ 8:26pm

    "Can Innovation Through Business 'Solve' Issues That Legal Repression Can't?"

    Yes, what is needed is for one group, or company, or person to buy a single big 4 record label. Cut it down to nothing more than the catalog and an online company. Then undersell the others with 30 cent itune songs, reduced fee's on web broadcasting, etc. Open up the catalog in a smart way. Boom the rest fail because they can not shed the fat quick enough.

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    Anonymous Coward, Jul 19th, 2011 @ 10:20pm

    I think there is an error in the article; Spotify will import all the music you already have on your devices. And for premium users, you can sync all your playlists to your phone and listen offline.

    The whole thing is incredibly easy to use, and there are numerous people I know who used to pay a monthly fee to one or more of the cyberlockers that have already switched.

     

    reply to this | link to this | view in chronology ]

    •  
      icon
      Mike Masnick (profile), Jul 20th, 2011 @ 12:43am

      Re:

      I think there is an error in the article; Spotify will import all the music you already have on your devices. And for premium users, you can sync all your playlists to your phone and listen offline.


      Which part is in error? The article notes that you can't port the songs you stream to via Spotify to another service, should a user wish to stop using Spotify or if it goes under. That's entirely unrelated to what you discuss.

      The whole thing is incredibly easy to use, and there are numerous people I know who used to pay a monthly fee to one or more of the cyberlockers that have already switched.

      I agree that Spotify is easy to use (though I wouldn't say incredibly). It is the best such service I've seen, and I subscribed to the unlimited offering the day it came out. I am quite disappointed to see that it doesn't have the automated playlist/recommendation engine that I remember from the European version of Spotify.

      Apparently, once again, the labels wouldn't allow licenses for that, once again bizarrely trying to prevent music discovery.

      I'm also a bit surprised at how many songs Spotify *doesn't* seem to have in its index. That part is a little disappointing, but I'm hopeful it will be improved rapidly.

      I'm a bit surprised to hear you say that people are switching from cyberlockers to Spotify, as I just don't see how the two are similar in any way.

       

      reply to this | link to this | view in chronology ]

  •  
    identicon
    Nicedoggy, Jul 19th, 2011 @ 11:16pm

    Gloria Gaynor - I Will Survive alternative lyrics
    Quote:>
    First I was afraid
    I was petrified
    Kept thinking I could never live
    without you to sell me anything
    But I spent so many nights
    thinking how you did me wrong
    I grew strong
    I learned how to hack
    and so you're back
    from Facebook
    I just walked in to find you here
    with that sad look upon your face
    I should have changed my stupid crypt
    I should have made you leave your key
    If I had known for just one second
    you'd be back to bother me

    Go on now logout
    just turn around now
    'cause you're not welcome anymore
    weren't you the one who tried to hurt me with a takedown
    you think I'd crumble
    you think I'd lay down and die
    Oh no, not I
    I will survive
    as long as I know how hack
    I know I will stay alive
    I've got all my drives to fill
    I've got all my shares to give
    and I'll survive
    I will survive

     

    reply to this | link to this | view in chronology ]

  •  
    identicon
    Anonymous Coward, Jul 21st, 2011 @ 6:26am

    Bas, your post contradicts everything that Mike Masnick posts here about the TPB and Sweden. Are you suggesting that (eek!) legal music is in fact the majority of the market now, and that TPB is no longer relevant in it's "home" country?

    Are you suggesting that, in the end, it's better for online companies to strike licensing deals, go legit, and actually build valid, functional business models that involve legally obtained and licensed content, rather than just "giving it all away"?

    I doubt you will ever get to post again going against the techdirt doctrine like that.

     

    reply to this | link to this | view in chronology ]

  •  
    icon
    PaulT (profile), Jul 21st, 2011 @ 6:44am

    ...and yet again. Stupid AC comment, completely missing the core of the site's regular themes as well as the article being responded to, smugly accusing it of something that's never claimed - in this case, that "free" is the only business model that can work. That's never been said, and besides which, Spotify offer a free service - you only need to pay if you want the full service without ads. So, tell me, how does a service that allows free music streaming go against the idea of "free", again?

    "Are you suggesting that (eek!) legal music is in fact the majority of the market now, and that TPB is no longer relevant in it's "home" country?"

    I believe that if you read the words he wrote, he's saying that a Swedish music executive claimed the latter in the quote provided, while digital sales are increasing in markets where Spotify have a foothold. Anything else you think he's saying is your own assumption.

    "I doubt you will ever get to post again going against the techdirt doctrine like that."

    Except, he's posting the exact thing Mike often posts. The only people who go against the "doctrine" tend to be pathetic trolls like yourself. If someone can come up with a decent argument that's not full of lies, false assumptions and baseless attacks, maybe that person would be invited to post themselves. Most intelligent people welcome honest debate and intelligent counterpoints. But, I never see anyone like that, just people who attack Mike and/or regular posters as being thieves and pirates, when they do and say nothing of the sort.

     

    reply to this | link to this | view in chronology ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Save me a cookie
  • Note: A CRLF will be replaced by a break tag (<br>), all other allowable HTML will remain intact
  • Allowed HTML Tags: <b> <i> <a> <em> <br> <strong> <blockquote> <hr> <tt>
Follow Techdirt
A word from our sponsors...
Essential Reading
Techdirt Reading List
Techdirt Insider Chat
A word from our sponsors...
Recent Stories
A word from our sponsors...

Close

Email This