Health of an Industry:
music, culture, & economics in the digital world
Also referred to as “piracy”, it is the violation of
a copyright owner’s exclusive rights.
These rights include: the right to reproduce,
perform, make copies of or derivative works
from copyrighted material.
•designed in 1991 by the Moving Pictures Experts Group (mpeg)
•based on the lossy algorithm. This algorithm significantly
reduces the file size by discarding or reducing the resolution of
sounds that are less audible by the human ear.
•reduced file size is then easier and faster to distribute between
•the .mp3. became the file format standard around 1994 as the
internet became more widely used
Users & Transfer Mediums
•central demographic – college students
•tend to have a higher interest in music.
•savvy and have access to high speed internet on campus.
•they are poor.
*2.6 billion songs are downloaded every month, mostly by
•transfer mediums include:
•BLOGS – authors of music blogs often post downloads of the
music they are writing about.
•PEER 2 PEER (p2p)– software like Soulseex, Gnutella,
Napster, & Freenet, for example, allow users to download
directly from each others computers. Often times a file is
downloaded in parts from several uses simultaneously.
•WEBSITES such as Pillage.com
Napster, the original transfer medium, used the traditional traffic
model by hosting the content on its own server. Therefore they were
held responsible for the piracy.
In a p2p model it is harder to assign blame.
The Industry Fights Back…
•pushed U.S. government to write the no electronic theft act (NET act).
•enables prosecution of infringement without monetary gain
•copy protection on physical copies is implemented in an effort to
prevent the extraction of information from them (ripping).
•licenses individual tracks & albums to be sold online by companies such
as Apple Computers, Amazon inc., Bleep.com, etc. thus allowing them to
be purchased and downloaded legally.
•Giving physical copies more value by providing incentives for customers
to purchase the music:
•including bonus material
•re-thinking how the content is packaged
•Recording Industry Association of America (RIAA) begins to track
students through their computer’s internet protocol address (IP address)
•The IP address leads RIAA techs to a campus’ networks) when a file has
been illegally downloaded. The technicians then record the IP address
and a sample of the copyrighted material to use as the basis for a lawsuit
•settlements to RIAA (on average about $3000)
•jail time and paying huge fines (up to $150,000 per song).
“Because we know that some audiences, particularly campus music downloaders,
can sometimes be impervious to even the most compelling educational messages or
legal alternatives, these new efforts aim to help students recognize that the
consequences for illegal downloading are more real than ever before,"
–RIAA President Cary Sherman
•71,060 U.S. jobs lost = $2.7 billion of worker’s earnings
•$422 million tax revenues lost
•$291 million in personal income tax lost
•$131 million in lost corporate income and production
Total Loss Annually= $12.5 billion (globally)
•The UCLA Online Institute for Cyberspace Law and Policy:
•Recording Industry Association of America (RIAA):
•Institute for Policy Innovation:
•Preventing Digital Music Piracy: The Carrot or the Stick by Rajiv K. Sinha, Naomi Mandel
•P2P, Online File-Sharing, and the Music Industry by Rufus Pollock
•A Behavioral Model of Digital Music Piracy by Ram D. Gopal, G. L. Sanders, Sudip
Bhattacharjee, Manish K. Agrawal, & Suzanne C Wagner
•Comtex Business, College students targeted by RIAA for Internet piracy