Will downloading digital music help or hurt artists and consumers?

The landscape of the digital music world is currently undergoing great changes. And guess what? Things aren't necessarily swinging in the favour of artists or consumers. Only a year ago journalists were making exciting statements like the following:

Neumu: "I know indie bands that now make a living touring — not from record sales. I also know artists who can live modestly releasing albums on their own labels, selling them off the Web, at shows and at record stores. This is the real "present." And in it, artists are proving to be smart and innovative. We are watching as the Big 5 run out into the ocean, chasing the elusive million-plus seller, and soon they'll be dragged to their deaths by the undertow."

But while it onced seemed like the advent of digital downloading technology would eliminate the need for major label middle men, the Big 5 (record labels: Sony, BMG, Warner, Universal, EMI) have smartened up. They're currently in bed with the likes of Microsoft, Hewlett Packard and Apple to usher in legal music downloading. That would be great, but instead of increasing access to music for consumers and royalties for artists, the opposite is occuring. Check out downhillbattle.org for an explanation of why legal downloading isn't really helping artists:

downhillbattle.org: "Apple says iTunes is "better than free" because it's "fair to the artists and record labels." That's simply not true. First of all, Apple gets 3 times as much money as musicians from each sale. Apple takes a 35% cut from every song and every album sold, a huge amount considering how little they have to do. Record labels receive the other 65% of each sale. Of this, major label artists will end up with only 8 to 14 cents per song, depending on their contract. Many of them will never even see this paltry share because they have to pay for producers and recording costs, both of which can be enormous. Until the musician "recoups" these costs, when you buy an iTunes song, the label gives them nothing."

And to see how the new trends in legal downloading (i.e. computer manufacturers' new commitment to digital rights management) will affect consumers, check out Bill Thompson's excellent and frighteningly revealing opinion piece:

BBC: "[Hewlett Packard is] putting digital rights management software in every one of its consumer devices, encrypting any recorded content stored on HP systems so that it can't be transferred to other computers or players. [...] I used to think that our fears over the ways that the entertainment industry were cracking down on file sharing and other copyright violations were unfounded, because the computing companies would refuse to see their products crippled by the need to keep the Recording Industry Association of America happy. I was wrong."

The issues surrounding music downloading are pretty complicated, and I don't necessarily agree with all of the content on the sites mentioned above. I'd welcome any comments you have on the matter.

Posted by matt at January 20, 2004 03:44 PM