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Music and Copyrights in the Digital Age
Survey Results
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Introduction.
Use of the internet by music professionals
Legal issues affecting the online music industry.
Purchasing behavior for used equipment.
Suggested further reading.
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Music professionals' use of the Internet is primarily driven by access to the wealth of freely
available DIY (Do-It-Yourself) information and inexpensive promotion and marketing solutions offered
by the Web.
Information Most Sought Online - 2A
Participants report that music news (67.9%) and marketing resources (52.1%) are most sought
after when surfing for music-related information. Their acquisition has traditionally resulted in
significant recurring cost, especially for independent musicians and businesses. Perhaps an ominous
sign, sites relying more heavily on charts (26.4%), releases (36.4%) and reviews (41.4%),
registered significantly less interest, though still important [2A].
For independent music sites such as labels and radio stations, this may mean acquiring access to more
news and DIY information, either through licensing agreements,
investment in content producers or building in-house the necessary infrastructure and staffing.
Use of Net for Career/Biz Advancement - 2B
The inexpensive nature of the Internet, from low-cost websites to free audio conversion and
distribution tools, and the shear size of the potential audience have greatly helped the independent
music industry. Participants report that the Internet has helped expand their audience (52.9%),
purchase cost-effective promotion (51.4%) and attract greater media exposure (45.7%) [2B]. The latter
firmly confirms the Internet as a primary tool used by the media, from journalist to music editors.
Somewhat more worrisome is the slow adoption of e-commerce by the industry with only 20% of
participants crediting the Internet with higher music sales. This is directly linked to the lack of a
ubiquitous, inexpensive distribution/commerce solution offering security and addressing the
uncertainty surrounding legal aspects such as copyright and royalty payments.
Have a Website - 3A
Distribute Audio Online - 3B
The hot Internet topic today for the music industry is digital music. Previously, RealNetworks had a
near monopoly on the streaming of music online. Now, with the wide acceptance of MPEG 3, audio
layer 1 (MP3), RealNetworks share of the market has declined to 68.6%, according to respondents
who were asked what they preferred as audio format to listen to [4A]. In just the last year, MP3 has
already taken a 25% share of the market. This is due, not only to its near CD quality sound, but its
ability to be downloaded and distributed, something not true in the case of RealAudio.
Preferred Online Audio Formats - 4A
An even greater percentage (54.5%) use formats other than RealAudio on their sites, such as MP3
and wav. RealNetworks has understood this and recently announced a new plug-in for the RealPlayer
G2, developed by Digital Bitcasting Corp., that will allow the streaming of MP3 files, which are
currently only able to be download on to a computer hard drive. RealNetworks has realized that if it
does not incorporate MP3 into its fold, it could quickly be left behind.
Microsoft has also entered the MP3 fray with the upcoming release of its Windows Media Player which will be
able to decipher MP3s. However, the major record labels, spearheaded by the Recording Industry
Association of America (RIAA), have been slow to catch on. They feel threatened by this new digital
music format which does not offer either copyright protection or distribution control. The RIAA has
lately taken to blaming the MP3 format for the decline last year of music sales among its prized
15-24 age group.
To confront the threat, the RIAA has formed the Secure Digital Music Initiative (SDMI) to develop a
standard digital musical format with copyright & distribution safeguards before the 1999 holiday
season. The proposal though does not properly address consumers concerns. With MP3, consumers
have a cost-effective tool to acquire their favorite music without having to visit brick and mortar
retail stores and pay up to $16 for CDs.
What was also very interesting, yet not surprising, was the fact that not one of the respondents
favored Liquid Audio or AT&T's a2b music. Liquid & AT&T made critical mistakes early on. With
Liquid Audio, musicians have to pay a fee (ranging from $60 to $250) to join, in the case of a2b music, it only
offers selected major artist as promotions for the albums.
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Introduction.
Use of the internet by music professionals
Legal issues affecting the online music industry.
Purchasing behavior for used equipment.
Suggested further reading.
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