Networks and the Music Industry essay

The peer-to-peer network shortly known as P2P networks denotes the sharing of computer resources by directly exchanging the files between computers. P2P networks allow the potential users to exchange the data and information through digital files without having to publish the data on the internet. The P2P network was originally created to share the files within a small organization in the absence of abundance of printers or scanners. Under such circumstances the P2P network proved to be useful for exchanging data. In the present day context P2P technology has helped various industries in a number of ways.

However, P2P technology has badly affected the music industry by allowing swapping of music files without payment to online stores. According to William and Alan (2004) there is absolutely low ethical standards in respect of P2P networks that it has become the usual practice to download music files from the internet and write them over compacting discs (CD) without making good the compensation due to the artist who created the music or without making payment to the firm that promoted, packaged and made distribution of the music product.

This represents an immoral behaviour in terms of the intellectual rights on the part of the people so downloading. This also amounts to piracy which includes the duplication of any digital data without the express approval of the creator is increasingly being practiced in the music industry throughout the world. Many of the countries in the world are trying to bring legislative measures to control this kind of piracy but it appears that technological developments will always be leading ahead of law and it would be difficult to curb this illegitimate activity in the entertainment industry.

The recent rapidity with which the P2P network applications grow allows users to share any kind of files and this has a direct effect on the sales revenues of the music industry. Jay (2000) submits that the increase in the P2P networks has seriously affected the sale of compact discs while there is a tremendous enhancement in the sale of compact discs with recording capabilities which contain songs with a copyright. The effect of P2P network applications on the music industry can be understood from the fact that with the increase in the number of files being swapped the revenue for the music industry will go down.

The continued draining of revenues will mark the end of any industry and with more number of people hooking on the internet the number of swapping of files will increase. This will be further amplified by the advancement in technology which will make the downloading and transferring of the files easier.

The downtrend in the sale of music products can be explained by some simple statistical figures. According to reports presented the sale of music CDs was down to 7 percent in the first six months of the year 2002 and this was in addition to the drop in the sale of 5.3 percent for the year 2001. (Weave 2002) According to the estimates of the International Federation of the Phonographic industry (IFPI) one copy of the CD album sold is burnt in a blank CD – R. The act of copying any data in a blank CD is denoted by the term ‘burning’. Harley (2002) states that it has been estimated that more or less one third of the burned CDs are filled with songs exclusively downloaded from the internet. Out of such downloaded songs 99percent are retrieved from illegal websites using unauthorized file sharing services.

The increased use of blank CD-Rs prove to be a convenient and easy method of getting the songs burnt on them from internet. Since this method of copying songs in a format that is playable on a normal CD player is inexpensive most of the college students who do not possess any disposable income resort to this kind of file sharing. Fine (2000) reports that according to a survey conducted by SoundScan Inc the sales of CD went down by at least 10 percent during a period of three years in wired colleges.

The protection of piracy has made the music industry bring about some solid actions against the infringement of their lawful rights. Greenberg and Erios, (2001) point out that as a measure against the prevention of the piracy the music industry has taken Napster and similar other organizations facilitating the illegal downloading to the court for claims against infringement of copyrights. Even though the courts ruled that Napster and others should forthwith stop the illegal music swapping and also compelled them to establish a payment based service, the piracy in the music industry never diminished.

According to Hammersley (2002) approximately 2 billion music files are getting downloaded every month by the action of the successors of Napster like Morpheus, Kazaar etc. This peer-to-peer illegal swapping of music files is getting increased day by day. Though these successors do not have a central website of their own like Napster, they are able to move from one computer to another, making detection of the piracy impossible. Another initiative from the music industry to combat the piracy was that the larger record companies having their own labels had established on-line subscription services of their own for selling music products online.

Magex (2001) points out that the big companies like Universal and BMG have already started selling their music products like CDs and other commodities form the website Getmusic. com a joint venture promoted by them to sell the music products on-line. They also have plans to promote the online store in major European countries. Another example of this initiative may be found in the EMI launching emidigital. com a business to business (B2B) website that enables EMI distribute the digital assets to other business partners and retailers. This has laid the platform for the future development of digital music industry on the internet.