Measured Against Reality

Friday, November 10, 2006

A Good Hard Look at Downloading

About a week ago someone told me that they don’t download because they believe that content makers should be paid for their work. This sounds like a reasonable argument, but it really isn’t. I’ll explain why for each type of media.

Let’s start with music, because that’s the most popular thing to download. Personally, I don’t buy CDs, ever. And don’t get me started on iTunes downloads, but that won’t happen either. It doesn’t really matter why, but let’s just assume I’m either poor or cheap (or both). Because of this, no record company, artist, or distributor will ever make a cent from me. So if I were to (hypothetically) download a CD, then they haven’t lost any money. They didn’t lose any money from distribution or production. They only money that they lost was the money spent making the music, which doesn’t change at all based on my actions. So they didn’t make any money, but they didn’t lose any either. Since we’ve already accepted that I wasn’t going to buy the CD, there should be no problem with me (hypothetically) downloading anything, because I was never going to net them any money.

So far the download is neutral, no money lost or gained. But let’s take it a step further. Now let’s assume that after I have (hypothetically) downloaded the CD I share it with my friend/family member/coworker, who does buy CDs. Despite how the record companies make it sound, people who buy CDs still exist, in massive numbers. He likes the music, and he goes out and purchases the CD. Had I not (hypothetically) downloaded it, he would not have heard it, and would not have netted them the money.

If we look at it like a pyramid-scheme, I share a CD with a few friends, who share it with a few friends, who share it with a few friends, and so on. Through the power of exponents, you get to a few hundred people very quickly, some of whom will buy the CD (or future CDs) and would not have without the (illegal (and hypothetical)) act of downloading. The more obscure the band, the more pronounced this effect will be, since they won’t have national exposure. This is exactly why sites like Jamendo do so well, people love free music, bands love free exposure, and the Creative Commons just works.

The situation is different for the “big four”. They already pay for exposure, and their music is the stuff on the radio. However, they produce fewer CDs of lower quality than they ever have, which is probably the main reason they’re making less money now. I wouldn’t be surprised if they lose more money from lawyer’s fees than from downloading. (As a note, I’m not sure if the distribution scheme I mention below would work for music as well as TV. It very well may, in a similar way that radio works. Because I discussed it there I won’t again here.)

To sum up: the case that downloading music hurts profits is unlikely, especially when the downloader is a person who wouldn’t normally purchase CDs. Downloading increases exposure, which can only result in more profits (whether through CDs or concert tickets). As such, it’s likely that non-traditional distribution is beneficial for artists, and quite possibly for distributors.

The case for TV is different. TV (at least for broadcast) is free, but supported by advertising. Gee wiz, that sounds like something familiar on the internet. There’s no way that you could use that model to support internet distribution! It would be really difficult for gigantic companies like FOX or CBS to dedicate a few servers to shows, make them free for download without commercials, and use a model like Salon’s to support it. That’s only the exact same thing as television at over the air, it would never work! They could probably even get away with keeping the commercials in there, most people are ridiculously lazy and wouldn’t bother with cutting them out. Even if people don’t watch the commercial(s), it’s no different than going to the bathroom during a break, and just as easy. As such that’s not a real problem.

Because TV is advertising dependent, distributing it over the internet would probably increase profits, whether through P2P channels or through something like I described above. There are many people who don’t have time to watch their favorite shows anymore, and services like TiVo are expensive. Right now I don’t even own a TV. No one is making any money off of me. The very worst case scenario for the stations is that I (hypothetically) download their shows off of P2P networks and retain my interest in them, so that when I do have access to a TV I watch their channel instead of another one. Who wants to watch a plotline-dependent show that they haven’t seen in nine months?

More likely (and beneficial) scenarios include me watching the show with friends, getting them hooked on it, thus increasing the potential number of advertising targets audience. If networks adopted the scheme above, they would still be able to show me ads, while I would be able to watch my favorite shows, all of them, at my leisure, with my friends. It’s the best of both worlds, and I really wish a major network would start doing it (and I don’t mean some crappy YouTube-esque Flash Plugin that you need to be online to watch and is 200 pixels wide. I want an .avi that I can store on a hard drive and watch whenever I want to, at least at TV quality).

To sum up: Illegal downloading probably negligibly affects television. Even if it does, the effect is likely to be positive. Not to mention that the ability to mitigate the effects and give the customer what they want while still making money is well within the content provider’s capabilities, if they wanted to do it.

Movies are a different beast still. However, they’re pretty much like music, except where exposure matters less. They’re also much more expensive to produce, and an ad-supported distribution network probably wouldn’t work as well. I’d have sympathy with Hollywood if it weren’t for the fact that they make about one good movie a year, they haven’t had an original idea in twenty, and their slow demise will almost certainly be a benefit to all of society. I won’t discuss the issue further.


I am well beyond skeptical that downloading hurts anyone. Given people’s actual behavior (as opposed to the fantasy-land where everyone who downloads a CD would have bought it) the effects will be much smaller than the $20 bajillion estimates that the RIAA throws around, and this doesn’t take into account any of the positive effects, which are hard to quantify, but extant nonetheless. (For a fortuitously timed article on this subject that just came to my attention, see here.)

Anyone interested in learning more about copyright issues should read Free Culture by Lawrence Lessig, Stanford Professor of Law. He distributes it for free online, and (unlike me) isn’t writing based solely on his own logic. I highly recommend it.

(Final note to those feeling litigious: when I write in the first person it does not actually indicate that I have performed the act that the narrator was said to have performed. This page in no way constitutes proof that I have ever violated any law.)

Labels: , , , , , , , ,

6 Comments:

  • Nice read !

    This is Laurent from Jamendo, i'm writing from luxembourg, it's really fun to read a standford student blogging on Jamendo.

    Thanks for the blog entry.

    --
    Laurent

    By Blogger Laurent, at 12:48 PM, November 10, 2006  

  • Being a musician, I can tell you that producing music is an extraordinarily expensive hobby. Some musicians try to make careers out of it to varying degrees of success, and most fail. This is understood. We do, however, have respect for the amount of money it takes a musician to create what he creates, and we respect his right to be compensated fairly for our enjoyment of it.

    Downloading music is a good way to get familiar with an artist, and if you like them, buy their album.

    "
    If we look at it like a pyramid-scheme, I share a CD with a few friends, who share it with a few friends, who share it with a few friends, and so on. Through the power of exponents, you get to a few hundred people very quickly, some of whom will buy the CD (or future CDs) and would not have without the (illegal (and hypothetical)) act of downloading. The more obscure the band, the more pronounced this effect will be, since they won’t have national exposure."

    This is predicated on those people liking the music in question, which is not necessarily so. I've made my music publicly and freely available for years but nobody cares because they don't like it. That's fine with me, but for those artists who have given up working to make music for a living, their intellectual property is their wellbeing, and exposure is a means to the ends of sustaining their lifestyle.

    "I don’t buy CDs, ever. And don’t get me started on iTunes downloads, but that won’t happen either. It doesn’t really matter why, but let’s just assume I’m either poor or cheap (or both)."

    Or neither. You might just be a jerk who likes to download music and burn cds because you don't feel like paying for it. This type of man makes up a bigger chunk of society than one would think, and copyright law exists to protect producers of intellectual property from such a class.

    I don't download because I believe content creators should be compensated for their work. This is an extremely reasonable argument and one that can be appreciated by the content creators you alienated the moment you started writing that paragraph.

    By Blogger Mr. Fantastic!, at 6:10 PM, November 10, 2006  

  • Oi. "Or neither. You might just be a jerk who likes to download music and burn cds because you don't feel like paying for it. This type of man makes up a bigger chunk of society than one would think, and copyright law exists to protect producers of intellectual property from such a class."

    Ok, so let's say that half of society is too cheap to buy CDs. My argument is still valid. The more people hear an artist, the more likely it is that the person's music will be bought. There's no way to deny that. Once you accept the people who download wouldn't have bought anything then it doesn't matter if they're 99% of society, because the musician would never have made money off of them. I fail to see how those people violate anyone's property rights.

    How many of the artists who are just starting out make most of their money from CDs? I would think that they'd get most of it from concerts, and I've heard that before (but I don't remember from where, so it may not be true).

    I'm sure that content creators will thank you when they get the dollar that they actually make off of the $18 CD you bought. Also, go check out Jamendo. Content creators clearly have no problem with downloading, (which is why so many speak out in favor of it, and so few against it).

    By Blogger Stupac2, at 6:29 PM, November 10, 2006  

  • Yeah, downloading with the artist's consent is fantastic, it's the way I've gotten my stuff around to those four people who care about it. It's the indiscriminate limewire-ing of music that pisses me off. There really are people out there who will never spend a dime to compensate artists they like.

    Some artists can perform or sell merch, but a lot of us can't. I record only, because I don't work with anyone else and play all the instruments. I know lots of dj's, recordists and other artists are the same way.

    These people tend to be hobbyists too, who work for a living and then jam on the side. I still think that if they want to sell a CD they deserve to sell it, not have it ripped off of them.

    I'm actually at work but i'll check out that site when I get home. I've always thought that the internet would be the future of music and it's great to see it coming to fruition.

    By Blogger Mr. Fantastic!, at 6:59 PM, November 10, 2006  

  • This was an excellent read! And the comment by Mr. Fantastic and your reply really illustrates the most significant aspects of this argument.

    I agree with you about your model of how downloading does not HURT as much as it HELPs. This is the model that google and pretty much every social-networking based website has adopted in order to survive (and thrive!). They make their services or products pretty freely available, which reaches many many people. If they monetize all those eyeballs with quality advertising, or compelling reasons to give them money (such as tee shirts, concerts, or authentic stories of sick kitties or Financial Aid screwing them over), then the number of views isn't a bad thing...

    as long as those "views/impressions/downloads" really are free for the creator.

    The problem comes in when the product itself is difficult or expensive to make. Most of society is still structured around the idea that work and productivity should be DIRECTLY compensated, and at a measurable and fixed rate.

    There are few businesses out there that provide services for free and depend on some other indirect method of financially supporting that (granted, those business models are growing. e.g. Google, webtwopointoh businesses, etc etc)

    For musicians, yes new musicians are finding cheap ways to make music and are thrilled enough to share it freely on the off-chance that people will love them. It's more about "I do this because I love it" rather than "I do this because I want to make a living off of it"

    Blah blah blah, I'm rambling... and I'm sure you can see my point here.

    Anyway, it's two conflicting models, and they aren't compatible right now.

    I hope that there's a thrilling and long-awaited culture shift (and I think you do to) that will help improve the corporate world's ability to interface with the creative world.

    Writing about it and debating the ideas is definitely one way to get conversations about it going and initiate change.

    By Anonymous Emily Nashif, at 7:42 PM, November 10, 2006  

  • Downloading music online is risky business - you can get many Free Music Downloads from iTunes and you will not get in trouble.

    By Blogger TropFish, at 8:18 PM, November 12, 2006  

Post a Comment

Links to this post:

Create a Link

<< Home