Mp3’s Shaking Up The Music Industry

Main Point: To determine how the MP3 revolution is affecting music sales.

THEISIS: Mp3 file sharing does not affect record sales; Recording industries does not expect everyone to stop downloading mp3’s, which they invented the technology for, because they are making too much money making noise about it.

Introduction:

• What is MP3’s
• How did MP3’s flourish

1. Popularity of music videos in eighties
2. Record industries had unlimited budget to technically advance
3. Music industries attracted more customers

• How the recording industries not only encouraged, but demanded MP3’s

1. Music industries strived to make more music available to more customers
2. They pushed for more cost effective and cheaper ways of doing things
3. Large percentage of music marketing is to people on limited budgets

Popularity of MP3’s

• Recognizing the target audience

1. Teens and young adults are primary audience for MP3 downloads
2. This age group is more concerned with price over quality
3. Current hits from current pop stars are most available downloads

• MP3 advantages over existing means of music

1. Costs
2. Convenience, easily portable
3. No commercials
4. No sales people, no long lines, availability

• Today’s lifestyles are high pressured and demanding, requiring music to be easy, quick, and readily available

Exactly how is MP3’s affecting the music economy

• Is the recording industry causing problems for itself

1. Their law suits are contradicting
2. Spending more time in attorneys offices and court then recording studios
3. More concerned with collecting for every song, then overall sales
4. Digital recordings sell mainly singles

• Mp3’s music sales are surpassing store music sales

1. Before music downloads, music stores had problems with theft
2. Theft of music forced high prices
3. Study reveals file sharing has little impact on record sales

• Arguments arising that record companies are more concerned with controlling what the public listens too, hiding behind copyright infringement

1. People recorded music directly from the radio to cassettes, nothing was ever said
2. Webcaster’s claim recording companies are making unreasonable demands
3. Prosecution and filesharing

Mp3’s impact on future music companies

• Latest from Recording Industry Association of America
• New royalty rates
• Demand for positions is music industry is changing

1. Iphones, ipods and downloads
2. Music companies making arrangements with download companies
3. Is the record companies really having problems

Conclusion;

• Overview of Mp3’s
• Advantages of Mp3’s
• Disadvantages
• The recording industry does not really care about royalties for each song
• Future of record companies and music industry

Introduction:

            Music videos promote music sales and upcoming concerts of touring artists releasing new albums. Musical sales generate billions of dollars. Musical options for music loving fans include vinyl records, eight tracks, progressed to more mobile cassettes, then compact disks. Vinyl records, eight tracks and very quickly cassette tapes and compact disks are being replaced with Mp3’s. In the early eighties, music videos flooded the music scene, popularizing music industry. Everyone wanted to hear more and more music. The music industry acquired more customers.  This sudden increased interests in music resulted in rapid advancements of technology. The recording industry quickly gained an unlimited budget to work with, making nonstop technology breakthroughs. Recording engineers constantly seeked ways to get wider variety of music to more and more people in less time. They were hoping to attract more customers, make the music industry more appealing, and provide them with all the songs the fans could ever hope for.

The record companies succeeded. Today, MP3 downloads dominates the music market. This is not what the production companies had in mind. Mp3 revolution is shaking up the music industry. Mp3 downloads is resulting in recording  companies spending more time in their attorneys offices and in court than the recording studio.  Multiple law suits and threats of law suits and criminal prosecution breaks out everyday between recording companies and organizations promoting file sharing and downloadingMp3’s. The recording industries forced to close down certain departments and music stores argue they are not receiving full payments they are entitled to. At the same time, these recording companies are opening new divisions and more people employed in the music profession are allowed to work from home, significantly cutting expenses for the employee and the business. Even with illegal downloading, music sales are exceeding store sales. Recording industries are concerned with illegal downloading. Record stores reported high numbers of theft in their businesses. Mp3 sales are resulting in music generating billions of dollars, just distributed differently.  (Nate, May 12,2007)

Mp3 file sharing does not affect record sales; Recording industries does not expect everyone to stop downloading mp3’s, which they invented the technology for, because they are making too much money making noise about it.

Popularity of Mp3’s:

            Downloading, legal and illegal file sharing booms astronomically. Reasons MP3’s popularity skyrockets depend largely on its target audiences. A major portion of available downloads are popular music, current hits, and other music appealing to the teen and young adult crowds. Broadway musicals, musical theatre, classical, jazz, ragtime, big band, blues are not as readily available from downloads as current hits are. Younger generations concerned with cost effectiveness will seek cheaper options. Fans of other music genres priorities are purchasing guaranteed quality sound and reputable recordings.

            The most outstanding advantages of MP3’s, is the extremely low costs. Even paid websites offer unlimited downloads within a period of time for one price. While eight tracks and cassettes were always breaking or wearing out, vinyl records always getting scratched, devices playing MP3’s will give out long before the song quality will.  Commercial free music is another advantage of MP3’s. Radio stations played music marathons allegedly without interruption. However, an obnoxious DJ would interrupt every other song to remind listeners they were listening to music marathons without interruptions. Younger generations, or the primary target audience of MP3’s, are usually on a budget. Another significant advantage is the mobility and flexibility of the music. Music is played while people work, relax, workout, drive, play, do housework, walk, run, shop. Mp3’s on cell phones, ipods, and other downloadable forms do not skip or jump track. Favorite songs can be listened to on notebooks, cell phones, iPods, miniature radios and cars. Shopping for music online is quicker, relaxed, and uninfluenced.

            Today’s lifestyles are fast paced. Driving to music shops seeking music may take up at least an hour, if someone lives in a small city. If the product in question is a high demand item, it may take several attempts at two or three stores. Sometimes the only option is ordering the music, which the customer could have done so before wasting so much time. Online downloads never sell out. Downloads are instantly available. Recording industries demand their artists and staff work fast, especially when summer is approaching. Music customers demand products and services meet their lifestyle.

How is the music industry affected;

            Recording artists may be causing its own problems. There is no indication layoffs are associated with declining record sales. Studies are revealing music downloads and filesharing has very little, if any, affect on the record sales.  (Knopper, 2006) It was  record companies who invented the technology to download MP3’s.  Arguments are arising if the recording companies really are concerned with royalties from downloads.

            Record companies are making money by making noise about copyright infringement. They are signing lucrative contracts with webcasters who promote Mp3’s. Studies show music sales has its highs and lows, with or without the file sharing. In the early eighties, everyone had radios with attached cassettes to them. Recording a song directly off the radio required pushing two button simultaneously; play and record. The production company and the artists got paid by the radio station everytime the song was played. So they did not care if individuals recorded their songs off the radio or not.  Of course the rules applied that this was for personal use only. If a person had a business, such as a dance studio, they had to obtain permission to play the song for any public performance because profits were being made from it. Copying a song onto a cassette tape was not considered illegal.

            Sources show that recording industries are more concerned with collecting money from businesses promoting MP3 downloads, not the individual actually downloading each and every song.  Record companies using the legal system to go after each individual downloading music would take way to much court time and taxpayers money. Record companies are definitely not losing because of file sharing. If anything, they are making money because of file sharing. File sharing or promotion of new songs reaches more people through the Internet than purchasing songs will.

Record companies can write off so called losses through file sharing and downloads, money they would be paying in taxes anyhow. File sharing may cause a slight decline in the number of people who go purchase the CD at the store. But record companies are receiving the increased sales through the contracts made with webcasters, and increased concert sales, and movie sales. People feel encouraged to go see a movie when they hear a song they like playing in the advertisement of that movie. If the song is played in the movie, the record company most certainly got their cut from it. Otherwise, they will be sure and get their cut in court.     However, the music industry is ever changing. If employees and executives want to stay employed in the music business, they must look at their education as always continuing and changing. Technology is ever changing, expanding and progressing. The music industry moves very fast.

Record companies are after control;

            There is no question that not the best artists get recording contracts. There are some artists that are very talented never getting signed, or if they do they do not get publicity. There are some artists who are famous because of genius marketing and computer enhancement that makes them sound good. Whether the public hears about a singer or not, is entirely political. In the early 70’s, a group of singers could not get producers to publish their music. They went out on their own, recording and publishing their own music. They put their own music on the market. The name of the album was called the outlaws.

            You Tube and upload of music videos allows artists to publicly advertise their own talents. The result is, the record industry has no control over what the public likes and listens too. The reasons for this is because of business contracts the record industry signs with others. These contracts include fashions, sodas, movies and so on. Recording industries  get very little of their money from the actual sales of the album.

            Everyone is making a big deal about stealing music. Today, people can still record songs from the radio directly onto a cassette tape, transfer it into a digital recording  on what ever compatible MP3 device they have.  If the record companies were actually hurting financially from so many people copying songs instead of purchasing them, they would have noticed the sales when manufacturers started combining radios and cassettes. If that was the situation, then making the technology for MP3 file sharing would have made no sense.

            Record stores had a problem with theft, much more so than any other stores. It comes down to the character of the majority of traditional music fans. Many people who collect music is young, and cannot afford to purchase every song or album they want. Music businesses are not going to lose money. The ones stealing to compensate their lack of funds is making it harder on themselves, the prices have no choice but to go up.  People working in the recording industry, specifically at the lower levels of the industry, are not that reputable. It is very cut throat. What these people say today, they may not say the same thing tomorrow. Agreements and contracts are continuously being violated. The lawsuits going on between recording companies and music industry’s were set up to happen anyway, with or without file sharing.

            Record company’s argue that file sharing sales only singles. Everyone who ever purchased Now that’s what I call Music knows that it is not only hits on the album as they advertise. About half of the songs are hits, and the other half are songs no one ever heard. No one knows for sure why record company’s do this. When an artists makes an album, record companies only allow certain songs to be released.

            The record company’s does not want everyone to stop downloading or file sharing from the Internet. They are making too much money complaining about copyright infringement. At a university, the record companies were making deals with students to pay 1,000.00 fines for downloading or file sharing. If the student agrees to this, the record company will not take it court. There are numerous cases of attorney’s catching someone illegally downloading music, and convince the “offender” to pay up just because they say so. No court order, no court decision, just because they say so. The person caught downloading the files is letting the accusers off easy.

Notes; 

Ap. H (August 2, 2007) YouTube criticized over copyrights retrieved Aug 3, 2007,

http://www.time.com/time/business/article/0,8599,1649111,00.html

  Source is Time news magazine informing about the recording industry’s recent copyright infringement allegations against You tube.  It says which changes the industry  is demanding, explains why the recording industry claims this is copyright violations and  that Youtube makes immediate changes, and eliminate the files violating copyright infringements.

Anderson, N (May 12, 2006) Music labels made mistakes with fair play retrieved August 4, 2007 Art of Technology

http://arstechnica.com/news.ars/post/20060512-6822.html

Source is an online  news magazine pointing out that recording companies are making ridiculous demands, how the recording companies are contradicting themselves, one representative says it is illegal to make copies of ones on CD, but it is not illegal for someone to purchase the CD and make themselves a backup copy in case damage to the original.

Anderson, N (May 22, 2006) Making money selling money without DRM; the rise of emusic retrieved August 4, 2007 Art of Technology

http://arstechnica.com/articles/culture/emusic.ars

Source is Internet news source that is an extension or link in combination with the previous source. Source investigates how ipods, iphones, emusic etc is changing the music industry.  The CEO’s of the music industry and the webcasters reach an agreement and sign contracts to keep the record company’s happy.

Baage J (aug 2, 2007) Elton John wants to shut down the Internet retrieved August 3, 2007 Buzz Watch

 http://www.dmwmedia.com/news/2007/08/02/buzz-watch-elton-john-wants-to-shut-down-the-internet

 This is a news magazine source where the legend pop -blues singer, Elton John is trying to shut down the Internet. The source explains why Elton John feels that is the only way to make music flourish again. It is an informative only source. 

Brandle, L BrunoA, Butler S, ChristmanE, GarrityB, Koranteng,J (Feb. 24, 2007) The latest news form Biz billboard, 199 (8) 9-12 retrieved August 4, 2007 Study P2P has little impact on album sales;

A  magazine source showing studies and statistics prove that file sharing have no impact or no influence on album sales. The source is from Billboard magazine, a very reputable publication in the music industry, keeping constant updates what is going with singing artists, recording industry, sales, music stock market,

Carson, V (August 1, 2007) Music from disks are still in the pink, retrieved August 3, 2007, Brisbane Times  http://www.brisbanetimes.com.au/news/digital-music/music-on-discs-are-still-in-the-pink

A news magazine source arguing that disks sales are dropping because of MP3 downloading and file sharing. The article points out that music sales are not dropping, but disk sales are not dropping. Once again, the music industry’s are making money, just in a different form.

Burskurk E (2003) Burning Down the House; Ripping, Remixing, and more

EmeryVille CA Mcgraw Hill

A book source informing about how file sharing and downloading is done legally, dealing with the recording industry and its laws, going into explanation record companies are the ones who invented and encouraged downloads, and how the record companies are actually profiting from it. The book is targets an audience who wants to know more about file sharing but keeping it legal.

Hedkte J. (1999) Mp3 and the Digital Music Revolution; Turn you PC into a quality sound Jukebox Lakewood CO, Top Floor Publishing

Book source, almost the same thing as Burning Down the House book. This book also discusses the music industry and the changes with technology advancements that is changing the music industry. It briefly discusses how recording industry’s get their revenue, very little of it is from music sales.

Houghton, B (July 6, 2007) Napster Responds to Hypebots Criticism; Internet Financial News

 http://www.internetfinancialnews.com/financialblogtalk/news/ifn-6-20070706NaspterRespondsToHypebotsCriticism.htm

A news Internet source letting everyone know that Napster is cooperating with the laws, Napster wants to stay reputable. The source shows where the stock market in the music industry is right now, and the expected effect Apple products has on the music industry and sales.

Cave, Damien (2004) File Sharing Getting Bad Rap, Rolling Stones, Retrieved August 6, 2007

Rolling Stone magazine; investigates research claiming that file sharing does not affect record sales. Says why people download, what types of songs they download why it does not affect sales, and what actually does affect sales.

Siv, Sherwin (July 31, 2007) Recording industry threat looms over net radio; Attorney Sherwin Siv says the threat to Net radio’s survival is really about the recording industry’s obsession to control digital music. Retrieved August 4, 2007 cnet news.com

http://news.com.com/Recording+industry+threat+looms+over+Net+radio/2010-1027_3-6199582.html

A news internet source written and published by an investigating attorney points out that the recording industry’s allegations continue to contradict their own allegations, there must be some other reason the recording industry is going on and on about file sharing and downloading. He points out that it was not illegal when everyone was recording music onto a cassette tape directly from the radio, and online streaming is the same thing. The article argues that the recording industry’s want control over what people listen too, using copyright infringement as their outlet.

Non Print sources;

File-sharing crackdown; students are the targets;

Yahoo.com

http://video.yahoo.com/video/play?vid=1083963892

Source from Yahoo videos informs about the recording industry’s intentions on targeting students and taking them to court for stealing music. Source looks at both sides of the issues, those for and against file sharing, such as the music industry, the music artists and general views.

PSA illegal downloading

Yahoo videos

http://video.yahoo.com/video/play?vid=196299

Short video of people talking about how great outstanding citizens they are, all the volunteer work they do, they stay out of trouble. With all of their good services they give to the community, downloading music files makes them criminals.

Reference page for Non Internet sources; 

Burskurk E (2003) Burning Down the House; Ripping, Remixing, and more

EmeryVille CA Mcgraw Hill

Chapters 1-2. Pages 2-56.

Mp3 and the Digital Music Revolution; Turn you PC into a quality sound Jukebox Lakewood CO, Top Floor Publishing

Book Reference information comes from over all Chapters 2 and 5. PP 15-17, 20 and

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