Piracy killing music! - the industry's explanation for its increase in sales

singemonkey · 2011-01-10T20:13:34+00:00

Music industry "victims" blame reduced revenues on piracy. But sales are up. Is this the whole story? http://torrentfreak.com/more-music-sold-than-ever-before-despite-piracy-110110/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+Torrentfreak+%28Torrentfreak%29&utm_content=Google+Reader

StephenG

how much money does the label make from a tour??

how much goes to the artist and how much to the label? from a tour, not cd sales.

MIKA-the-better-one

@Donovan..... you get a real job.... U2 still tour, Rolling stones still tour..... they are getting pretty old... I think as a musician you stay touring quite a bit...... or you save your money......... Obviously we have not got to the point yet where touring is the only way to earn, but its definatly the main income....
Now I also asked a question, you cant answer it with a different question ?

DonovanB

Get a real job? a REAL job?

Oh my word. you need to get a real clue. Who is going to hire a 45 year old muso to do real work?

I'm not listening to you anymore. If you don't consider music to be a REAL Career that means you don't value music, musicians or what they really offer.

Bob-Dubery

MIKA the better one wrote Most people who buy music around the world intend to see the band live and usually have the oppurtunity.
In the US touring is key to any band, infact most smaller labels will not sign you unless you are touring the country....already. menaing most money comes via tours.

Music is still sold, but as said a gazzillion times, its more a tool to get you to a show

for the guy in the Jetta, lucky him cuz now he can listen for free.

Does anyone else not sense that this is now in favour of new bands??? giving them alot more power

No. What they actually need is to make enough money that they can make more music - and have a bit in the bank for when they get a family or if they get sick.

If they want to take a decision to give some of their output away as a promotional tool then that's their decision and their risk. However for us to assume that all bands should work this way and so it's cool to take their stuff for free anway even if they haven't told us that we don't need to pay sounds self-serving to me. It sounds a lot like "I want stuff for free" and trying to invent justifications for it.

It's always cheap and easy to give other people's stuff away.

Bob-Dubery

StephenG wrote how much money does the label make from a tour??

how much goes to the artist and how much to the label? from a tour, not cd sales.

There's no fixed ratio or amount. Some artists fund their own tours but allow the record company to pay for the making of the album. Some guys pay it all themselves, take all the risk themselves, and thus take more of the profits. In some cases the record company pays for everything in advance.

MIKA-the-better-one

Donovan Banks wrote Get a real job? a REAL job?

Oh my word. you need to get a real clue. Who is going to hire a 45 year old muso to do real work?

I'm not listening to you anymore. If you don't consider music to be a REAL Career that means you don't value music, musicians or what they really offer.

Now you are just taking me out of contect to make me seem unreliable........
1000's of musicians have washed up, and had to go get a average job.......... 1000's of musicians are musicians while having a normal job....... 1000's of musicians use there status in music to ahead themselves in other avenues of work, art, film, vocal training etc
The referal of "real job" was a poke at fun..... anyone using such a forum as this would not hold such an opinion....... Frankly i find your diversion to not listen quite childish.....

MIKA-the-better-one

X-rated Bob wrote
MIKA the better one wrote "I want stuff for free" and trying to invent justifications for it.

It's always cheap and easy to give other people's stuff away.
Its not that hard to give music away for free...... I do it everday, at every show, and online, you could say there is no value to it as its made by me, pretty much an aspiring professional with no name behind it...... maybe i wont always give it away.... maybe if i ever get big enough and become the elite few who can sell a few I will..... but it wont be my life and blood...........
For any musician thats a no one you give music away.
And yes you can have the choice but there are smart choices

IceCreamMan

MIKA the better one wrote Most people who buy music around the world intend to see the band live and usually have the oppurtunity.
In the US touring is key to any band, infact most smaller labels will not sign you unless you are touring the country....already. menaing most money comes via tours.

Touring is lucrative for the behemoths that fill stadiums with 90 000 bums in seats ... for the average band touring is about promoting the band an in turn CD/paraphenalia sales ....

Mika, i think you have it the wrong way round for the run of the mill bands .... getting a coupla hundred dollars split 5 ways aint lucrative at all ...but the revenue generated by the table selling yr CD's an t shirts is far more lucrative.

( i recall reading it somewhere that bands get about 3 $ per seat sold ,which is a dismal amount of money but times 90 000 = 270k $ , a sizeable chunck of change - i could be wrong on the numbers but i seem to recall reading that somewhere)

MIKA-the-better-one

First tour eveyone looses money....... I expect they get better though..... there are lots of bands I know in the USA and Europe, who make most money via tours...... and some of them have no albums out, they have EPs, which only come out on Vinyl...... limited runs :/
they use Itunes etc..... but for the most part they dont stress about selling music, its about that selling out in everytown, which is pretty easy when everyone there has gotten to hear you legally or not :/
you can sell Cds' but I am talking on behalf of what I know here from my side of music which is getting bigger

IceCreamMan

MIKA the better one wrote First tour eveyone looses money....... I expect they get better though..... there are lots of bands I know in the USA and Europe, who make most money via tours...... and some of them have no albums out, they have EPs, which only come out on Vinyl...... limited runs :/
they use Itunes etc..... but for the most part they dont stress about selling music, its about that selling out in everytown, which is pretty easy when everyone there has gotten to hear you legally or not :/
you can sell Cds' but I am talking on behalf of what I know here from my side of music which is getting bigger

Of course the business model can and does work the way you describe it ...allow free distrubtion of music in the hope that you will sell out a venue and make money that way or via merchadise sales (non cd related , t shirts etc) but then the musician has made the choice to go that route and for unknown/"small" bands this is the way to go without a doubt .... i suspect most of these bands if offered a deal by a giant corporate will probably jump at the chance though but wont admit it .. big business offers huge benefits to all role players although offers cons as well..the machine needs to be fed though , for every band that sells a million there probably 10 that dont turn a profit and are subsidised by the profit generators .... also the directors need a fancy car etc ....

without the moguls of the music business we may never have had a rolling stones or beatles or <insert band name here>.

Jericho

Wizard wrote Market price has got nothing to do with cost:

(a) If I find diamonds in my garden, I don't have to give them away because they didn't cost me anything - I can sell them, with a clear conscience, at the price the market is prepared to pay for them

(b) If I make marimba's and they cost me R 1,000 to make, I can't force people to pay this when they perceive the value to be R 400
(yes - true story)

I'm sorry but you are completely wrong ....and I'm going to let Mike Masnick explain basic economics to you.But first I'm going to show you how you are wrong. You claim if you find diamonds in your garden you can sell them at whatever price the market is willing to pay for them. Not true in a competitive market. That is because your competition will be forced to reduce their prices to compete with you... so your cost of zero is pushing market prices DOWN.

Here's Mike explaining in a more simpler manner how marginal cost influences prices....its a pretty straightforward and generally accepted economic theory.

Wizard wroteTo explain this, it helps to go back to your basic economics class and recognize that, in a competitive market, the price of a good is always going to get pushed towards its marginal cost. That actually makes a lot of sense. As competition continues, it puts pressure on profits, but producers aren't willing (or can't for very long) keep selling goods at a direct loss. Sunk (or fixed) costs don't matter, because they've already been paid -- so everything gets pushed to marginal cost. That's pretty well accepted by most folks -- but it's still misinterpreted by many. They tend to look at it and say that if price equals marginal cost, then no one would ever produce anything. That's a misconception that is at the heart of this whole debate. The problem is that they don't add in the element of time, and the idea that what drives innovation is the constant efforts by the producers in the space to add fleeting competitive advantages (what some economists have annoyingly called "monopolistic competition," a name that I think is misleading). In other words, companies look to add some value to the goods that makes their goods better than the competition in some way -- and that unique value helps them command a profit. But, the nature of the competitive market is that it's always shifting, so that everyone needs to keep on innovating, or any innovation will be matched (and usually surpassed) by competitors. That's good for everyone. It keeps a market dynamic and growing and helps out everyone.

Wizard

Jericho wrote I'm sorry but you are completely wrong ....and I'm going to let Mike Masnick explain basic economics to you.

Wizard just smiles ?

You may want to extend your economics influence beyond Mike Masnick ...

DonovanB

Jerocho, what you are saying is this?

fixed Cost of production, R20,000
Cost per unit of reproduction R1

Total cost to produce 200 units, R20,200. or R101 per unit.
Cost to produce 100,000 units, R120,000. or R12 per unit.

I do agree that the marginal cost is low and should be filtered down. Isn't paying $1 per song better than paying R180 for 10 songs, only 3 of which you like. Meaning R60 per song?

I guess that why, in the original article, single sales are up and album sales are down.

Doesn't make piracy right, or good. So in saying Piracy is the best thing to happen to music, what one actually means is that very cheap reproduction of music is the best thing to happen to music. Easy distribution is a great thing.

Wizard

Jericho wrote That is because your competition will be forced to reduce their prices to compete with you...

They won't ... because I'll be selling at the same price as them ... ?
I just have to sell at market price in order to be able to sell my product ...

singemonkey

Wizard wrote
Jericho wrote I'm sorry but you are completely wrong ....and I'm going to let Mike Masnick explain basic economics to you.
Wizard just smiles ?

You may want to extend your economics influence beyond Mike Masnick ...

IceCreamMan

Jericho wrote
Here's Mike explaining in a more simpler manner how marginal cost influences prices....its a pretty straightforward and generally accepted economic theory.
Wizard wroteTo explain this, it helps to go back to your basic economics class and recognize that, in a competitive market, the price of a good is always going to get pushed towards its marginal cost. That actually makes a lot of sense. As competition continues, it puts pressure on profits, but producers aren't willing (or can't for very long) keep selling goods at a direct loss. Sunk (or fixed) costs don't matter, because they've already been paid -- so everything gets pushed to marginal cost. That's pretty well accepted by most folks -- but it's still misinterpreted by many. They tend to look at it and say that if price equals marginal cost, then no one would ever produce anything. That's a misconception that is at the heart of this whole debate. The problem is that they don't add in the element of time, and the idea that what drives innovation is the constant efforts by the producers in the space to add fleeting competitive advantages (what some economists have annoyingly called "monopolistic competition," a name that I think is misleading). In other words, companies look to add some value to the goods that makes their goods better than the competition in some way -- and that unique value helps them command a profit. But, the nature of the competitive market is that it's always shifting, so that everyone needs to keep on innovating, or any innovation will be matched (and usually surpassed) by competitors. That's good for everyone. It keeps a market dynamic and growing and helps out everyone.

u used the term theory , interesting that eh.

then u use the term profit in yr explanation ???

without the profit motive , nothing gets produced ...

signed

confusedly yours

Seventhson

Well back in the 80s there was bootlegging. I don't think piracy will ever kill off music. I think all these justin dudes and pop sensations will kill off good music :'( ?

Bob-Dubery

Seventhson wrote Well back in the 80s there was bootlegging. I don't think piracy will ever kill off music. I think all these justin dudes and pop sensations will kill off good music :'( ?

There is still bootlegging. It started earlier than the 80s and still goes on.

It deprives the artist of income, in some cases makes a profit for the bootleggers that they do not share with the artist, and deprives the artist and/or label of control of their output.

There's an essentially harmless form of bootlegging which is fans taping for their own records - but it can be more malicious and exploitive.

A good way to find out how you REALLY feel about these issues is to put yourself in the hot seat. This makes it a little more real, a little less theoretical.

So you have a band, you have a CD, somebody or several somebodies is making copies of the disc that it cost you money to make and you will receive no income as a result (neither will the producer, the recording engineer and so on). They didn't ask you, but it's cool because your record is good and they want to share it with their buddies.

You're in hock because you bought a PA system (or the company bought it for you, but you have to pay it back so the position is basically the same).

Somebody decided that your album is so cool that they loaded it onto some free download site so that the whole world can have it without paying you anything for it (nobody asked you if this was OK).

Meanwhile you played a crap gig last night and the drummer audibly called you an "ass wipe" after you gave him a dirty look when he mangled the beat, but you saw some microphones out there and you know they're nothing to do with you or your sound guy. So now there's a recording out there on the Internet (you have to assume) that has you sounding really crap and like you're about to beat each other up.

You have gigs, but nobody is paying you a lot upfront because who the heck are you? We had Dan Patlansky here last week and folks know who HE is, but you guys? Hmmm.... well let's see if you pull a crowd and how much business the bar does.

It's easy to make these decisions when you're not the guy with something to lose.

StephenG

X-rated Bob wrote
It's easy to make these decisions when you're not the guy with something to lose.

But Bob, apparently, as some on here will have us believe, the week after someone gave away free copies of their cd, and after the tunes were uploaded to a free file sharing site, the band will be so popular they will book out the entire Soccer City stadium with fans, make themselves millions and live the rock star life... :?

so to everyone the band owes money too, they will just ask for an extension to the deadline to pay it back, until such time as their pirated cd's get them enough fans to fill soccer city.

so its all good in the end hey.

singemonkey

Well, speaking of putting yourself in the artists' shoes, here's fresh fuel for the fire:

http://torrentfreak.com/record-labels-to-pay-45-million-for-pirating-artists-music-110110/

A group of Canadian musicians file a class action suit against a number of huge record companies due to copyright infringement of their work. Facing possible damages of $6 billion, the companies settle out of court for $45 million.

In court:

“The conduct of the defendant record companies is aggravated by their strict and unremitting approach to the enforcement of their copyright interests against consumers,”

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