RIAA Reports Music Industry Is Making All The Money Just As New Study Says Piracy Has Never Been More Widespread

Music Industry

from the hmmm dept

As much conversation as gets logged on the topic of copyright infringement, or piracy, you may not have noticed that there are not that many arguments against piracy. Certainly there’s a volume of voices, particularly those coming from the entertainment industry, but those voices are typically making only one of two claims. The first claim is that piracy is morally wrong. This claim typically devolves into something along the lines of “but piracy is theft”, and relies on the intuitive notion that downloading, say, a song hurts the creator of that song by depriving them of income. If there was no income deprivation, there would be no moral wrong. The second claim skips the first part of that equation and simply asserts that piracy harms the entertainment or content industries, depriving them of the income they need in order to create more content. You will notice that, ultimately, there is actually only one argument against piracy: its effect on the income of the content producers.

With as much as entertainment advocacy groups like to pantomime Chicken Little on this topic, you might be surprised to learn that the RIAA recently came out with its 2017 Year-End industry report, in which it gleefully notes both how much money the music industry is making and, importantly, how that revenue is growing rather than shrinking.

In 2017 revenues from recorded music in the United States increased 16.5% at estimated retail value to $8.7 billion, continuing the growth from the previous year. At wholesale, revenues grew 12.6% to $5.9 billion. These increases were driven by more than 35 million paid subscriptions, a 56% growth year-over-year. This is the first time since 1999 that U.S. music revenues grew materially for two years in a row, while gaps in core rights continue to distort the marketplace and deprive recording artists and songwriters of the royalties they deserve.

So, we have two years of growth in music industry revenue in America, even as the RIAA is also still complaining about market distortions and artists not getting enough royalties. The full report notes that streaming revenue is way up, digital downloads are down, and physical product purchase revenue has been mostly flat. Note that this is all for the American market. Nowhere in the full report does it flesh out exactly what the RIAA’s complaints about artist compensation are based on, although piracy/infringement is almost certainly the answer.

The problem for that argument, which is again the only real argument for focusing on piracy as some great evil, is that another report just came out from MUSO, a group that tracks piracy, indicating that piracy is more popular in the public right now than it ever has been.

Piracy tracking outfit MUSO has documented the piracy landscape with data from tens of thousands of the largest global piracy sites. In its latest report, the company recorded more than 300 billion visits to pirate sites last year alone. This is an increase of 1.6 percent compared to 2016.

More than half of all these visits (53%) are going to streaming sites, making that the most popular piracy tool. Torrent sites and direct download portals still have a significant user base, but follow at a respectable distance. Most of the pirate visits came from the United States, followed by India and Brazil. Despite the various pirate site blockades, the UK also secured a spot in the top ten, ranked at the bottom with nine billion visits.

A couple of things to note in the report’s details. Again, America had the highest instances of piracy by far, nearly twice as much as India, which came in third. Also note that, while streaming sites for television was the most popular method of piracy in the public, pirating music came in second. So, we have two data points. The RIAA says that the American music industry revenue has risen two years running. MUSO says that Americans pirate more than anyone else, that they often pirate music, and that piracy levels are at the zenith and rising.

The “piracy hurts the music industry” mantra just took a credibility hit, no?

The explanation for this isn’t difficult to understand. Those that pirate music also buy music, go to concerts, and support the bands and music industry through all kinds of other purchases. They also likely subscribe to streaming services and pirate what they can’t find there, or what they discover there. The point is that music pirates are often fans of music and may purchase along with pirating.

In other words, the simplistic attack mantras from the RIAA don’t make a great deal of sense alongside the RIAA reporting that the music industry is making gobs of money, and increasingly so.

Filed Under: business models, copyright, music, piracy, recording industry
Companies: riaa