January 29, 2012

Is file-sharing the sole cause of the music industry's decline?

Here's the abstract from a newer paper by the always enlightening Stan Liebowitz (free PDF):

The file-sharing literature has focused mainly on whether file-sharing has decreased record sales, with less attention paid to the size of any decline. Although there is still some contention, most studies have concluded that file-sharing has decreased record sales. What has not been noted is that most estimates indicate that the file-sharing has caused the entire enormous decline in record sales that has occurred over the last decade. This heretofore hidden result is due to the lack of a consistent metric that would allow easy comparability across studies. The task of this paper is to provide such a metric, translate the results reported in the literature into that metric, and then summarizes the results from this exercise.

The studies that suggest that the whole decline in sales is due to file-sharing are earlier, back in the wild west days of the early 2000s. The more recent studies from 2008 and 2009 still put file-sharing's role as accounting for 65-75% of the declining sales.

Most of what the music industry puts out is junk, but sooner or later the zeitgeist will change and we'll get the next big thing. First it was jazz, then rock, and next who knows. But for that to happen, all of the infrastructure has to still be around. Good music, when people can create it again, won't record and distribute itself.

That's the worst part of this whole mess -- having to stick up for bloodsucking record companies. But what choice is there when the other side is file-sharing dorks who don't care if the basic infrastructure melts away, all so they can save a few bucks on their faggot album by Bruno Mars or Avenged Sevenfold?

7 comments:

  1. To maintain high levels of entertainment consumption, you have to make media which appeals to the majority of people living in a society(which includes everyone of all age groups except the very old). This was possible in the past, when people had children fairly young, and therefore they and their children would often belong to the same "rising-crime" or "falling-crime" cultural phase.

    Baby-Boomers typically enjoyed 80s culture just as much as their Gen-X kids did. For instance, my dad was born in 1949, yet he fondly remembers Fast Times at Ridgemont High, which came out when he was in his 30s. (when he saw American Pie, his reaction was "worst piece of shit I've ever seen"). My mom owns a CD by The Cure, despite being in her late 30s when the Cure came out.

    As parents wait longer and longer to have children, however, the population becomes more evenly divided between those born during rising-crime times vs. falling-crime times. When this happens, it becomes harder and harder for music to find broad demographic appeal. Record executives, have to choose a side - evidently they've sided with the Internet Generation, resulting in crappy music. Truth be told, however, even if they made music more oriented towards Baby-Boomers and Gen-xers, they'd still probably see a decline in sales, as the Millenials -unable to relate to entertainment that wasn't narcissistic - would stop consuming such entertainment.

    As a related note, you see this broad decline in entertainment consumption in all spectrums. Its been widely publicized that sales of movie tickets have been declining for a long time. This has usually been blamed on home media, but I don't buy it. I think its more that movies are now oriented towards only one half of the population - Millenials - to the point where the other half have dropped out.

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  2. A good idea may be to investigate whether record sales and movie ticket sales declined during the falling-crimes period of the 1930s, 40s, and 50s. My guess is that they didn't. Back then, people had children young, even those who were "cocooned". Subsequently, most members of the Silent Generation would have been parented by members of the Silent Generation, and would have had similar tastes to their parents in music and movies.

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  3. It appears to me that the primary motive for males making new music is that it gets you laid, on which file sharing has little or no impact.

    I also see lots hot chicks making home music videos and posting them on you tube. Some of them thereby get famous, and cash their fame in by starring in adverts. File sharing has some impact on their ability to monetize their fame, but not a whole lot, primarily due to the tendency of the recording industry to be excessively greedy and to mistreat its talent.

    Chicks like fame for its own sake, and because it helps them to marry famous guys, thus again, file sharing is likely to have small effect on the production of music.

    It might well, however, have adverse effect on the production of movies.

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  4. "file sharing is likely to have small effect on the production of music."

    As you say, though, only on the creative side. The article I quoted is talking about the record companies' health, not the talent they record and distribute.

    If that less creative but still necessary part of the infrastructure goes kaput due to file-sharing, then even when talent shows up again, they won't be able to be heard and enjoyed. All of that infrastructure will have to be re-built.

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  5. "A good idea may be to investigate whether record sales and movie ticket sales declined during the falling-crimes period of the 1930s, 40s, and 50s."

    I don't have the hard data at hand, but I do know that sometime then the movie theaters got clobbered. During the rising-crime Jazz Age, everyone went out to the grand picture palaces, and those buildings stopped being built during the mid-late '30s.

    I don't think ticket sales recovered until the late '50s or '60s, and didn't really take off until the mid-'70s with Jaws, Star Wars, etc.

    Some attribute the death of movies back then to the Depression -- but the first four years of it were part of rising-crime times, and people were still going out to movies, right up through King Kong.

    Others point to the disastrous impact of the 1948 Hollywood Antitrust case, where studios couldn't own their own theaters. But again, ticket sales slipped before then, and recovered like mad in the '70s and '80s, even though the antitrust decision was still in effect.

    The depth of the Depression and the antitrust case probably exacerbated the trend, but it was already there.

    I think there were plummeting record sales in the mid-'30s or a little later. It was attributed to widespread ownership of radios, but I doubt that.

    - Radio ownership soared during the '20s and early '30s, yet people were still crazy about records and live music.

    - Radio ownership only rose during the '60s through the '80s, but people started buying records like crazy again, and going out to concerts regularly.

    - Most of what people listened to on the radio in the later '30s through the early '50s (before it was eclipsed by TV) wasn't music at all. It was comedy variety, sit-coms, thrillers, soap operas, quiz shows, etc. So it couldn't have cannibalized record sales.

    - During the '20s, most of what was on radio was music, not those verbal genres. So even when it could have eaten into record sales, it didn't (just like the '60s - '80s).

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  6. "This was possible in the past, when people had children fairly young, and therefore they and their children would often belong to the same "rising-crime" or "falling-crime" cultural phase."

    I was too young to have my own music tastes, but my mom (born in '55) was way into New Wave, synth-pop, and mainstream rock too.

    On the drive to daycare everyday, she put in a Hall & Oates tape and we'd sing along to "Private Eyes." She says I used to bug her to sing a duet with me for "Oh Sherrie". But my voice was too deep, even for a 3 year-old, to do Steve Perry right.

    And it goes the other way, too -- kids in the '80s could get into their parents' music. My dad was born in '54, and has always been stuck in '64-'67 (before the Counter-Culture, but after the party had already gotten going). His music was still on the radio in the '80s.

    We heard it from our parents, but a good number of us listened to the oldies stations too. My brothers and I voluntarily watched the Help! movie every weekend for awhile there.

    He didn't get that into the music of the '80s, but those are probably his favorite movies.

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  7. It’s not just the inability to deal with new distribution models that’s killing the music industry; they haven’t been able to develop music production technology either. Correct me if I’m wrong, but the last truly revolutionary instruments were the synthesizer/sampler and the drum machine and both of those mainstreamed in the 1970’s. The new kinds of music explored in the 70’s and 80’s: Disco, New Wave, Hip Hop/Rap, Synthpop, Electro, Ambient, were all dependent upon one or both of those instruments. The only exception is Grunge and that rose in popularity primarily as a reaction to the new technology.

    Your average garage band today with a vocalist, drummer, guitarist and bassist is using the same technology that existed 35 years ago. My drum kit might have iron cobra power glide bass drum/hi-hat pedals and starcast mounting for the tom toms but really it’s no more advanced than what Buddy Rich was playing half a century ago.

    Musical innovation depends on technological innovation. 80’s sounding electrionic music might have made a comeback in the last few years but it just doesn’t sound as fresh as it did when the technology was new.

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