Record labels' attempts to 'squash' music piracy aren't working, says report
Music Industry News - as it happens
Source: Mi2N - August 15, 2002
Efforts by the record labels to use the courts to quash music piracy have
failed and legitimate online music services have had little impact, says
Michael Goodman, Senior Analyst for the Yankee Group's Media & Entertainment
Strategies research practice.
"The future of music, however, resides on the Internet, and its dramatically
lower distribution costs," he says.
In the meanwhile, the report says music lovers will continue to flock to
file sharing services such KaZaa, Morpheus, and LimeWire, "because of their
unlimited content and zero cost", going on, "Consumers aged 14 and older
downloaded 5.16 billion audio files in the United States via unlicensed
file- sharing services in 2001," it says. "This figure will grow to 7.44
billion audio files downloaded in 2005 before declining to 3.90 billion in
2007 due to the impact of legitimate music services, according to a new
Report titled "Digital Audio: Legitimate Services Inch Forward."
The report says to be successful, legitimate music services must meet the
* Availability: Music services must offer content from all five major labels
as well as the majority of independent labels.
* Ownership: Consumers do not want to rent music. If they pay for it, they
want to be able to mix it, burn it, copy it, and retain ownership even if
they choose to discontinue subscribing to a service.
* Portability: Downloaded files must be playable on different devices in the
home, at work, and when mobile.
* Exclusivity: Legitimate music services must differentiate themselves from
unlicensed services with unique content and services.
* Digital Rights Management (DRM): Consumers want to share music, and they
will find a way to do so, thereby defeating all realistic DRM capabilities.
Online music services will undoubtedly cause retail revenues to decline, but
new revenue streams and cost reductions will ultimately enhance record label
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