Someone is sharing your work, and it’s not the end of the world

I heard a story once, of a friend of a friend. I don’t really know if it’s true or not, but I think it’s representative of how quite a few people think.

The friend in question was apparently an accomplished musician, but he had hung up his guitar for good, never to release an album again. Why? It’s those darn kids and their piracy. “The second you release an album,” he lamented, “it’s up there for everyone to steal. You just can’t make money in the music business anymore.”

Obviously this isn’t true — while the industry itself may be in the beginnings of a death spiral, it’s hardly true that no one can make money-making music — but there’s something more interesting about the observation than just the fact that it’s wrong. The Internet and peer-to-peer technology has made pirating music easier, certainly, but people copied CDs and tapes long before Napster existed. For decades there have been easily accessible ways to copy music. So, even 30 years ago, when you put up an album it was “there for everyone to steal.”

On top of that, most artists actually benefit from music piracy.

Several studies have shown that most artists actually profit from unauthorized sharing of files. They sell more albums because people have the opportunity to download songs and entire albums for free. A study by Blackburn (2004), a PhD student from Harvard, found that the 75% of the artist actually profit from piracy. Blackburn reports that the most popular artist (top 25%) sell less records. However, the remaining 75% of all artists actually profit from filesharing. The same pattern was found by Pedersen (2006, see graph), who analyzed the change in royalties paid by the Nordisk Copyright Bureau between 2001 and 2005.

Linked on the above page is an overview of the studies on this topic:

The basic result is that online illegal file-sharing probably has some negative impact on traditional sales but the effect is appears to be quite small. The size of this effect is debated, and ranges from 0 to 100% of the sales decline in recent years, but a figure of between 0 and 30% would be a reasonable consensus value (i.e. that file-sharing accounted for 0-30% of the decline in sales not a 0-30% decline in sales). At the same time there is still substantial disagreement in the literature with the most impressive paper to date (Oberholzer and Strumpf 2005) estimating no impact from file-sharing.

So, basically, having your music shared online isn’t the end of the world. It’s actually probably good for you.

Additionally, and this is more of a technicality: I don’t like using the word “steal” to describe piracy, for reasons I’ve explained before. He (the above friend of a friend) isn’t losing anything when someone pirates his music. If you “steal” from a record store, you’re preventing the store from selling that record to anyone else, whereas when you download a song you’re not preventing the artist from selling it again, and there’s no evidence that you would have paid money for it if piracy wasn’t an option. That’s not to excuse it entirely, but I think it’s an important enough distinction to warrant avoiding the word “stea

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