The Music Industry’s New Internet Problem

from BW.com

Five years ago, New York-based graphic designer Gitamba Saila-Ngita spent around $100 a month buying CDs and digital downloads to fill his iPod. Now, he spends less than $10 each month on tunes. The reason? He gets almost all of his music from services like Imeem and Last.fm (CBS) where he can listen to pretty much anything over the Web for free or at minimal cost. “And I absolutely listen to more music than I used to,” says the 23-year-old. “I pretty much have music playing all the time. It’s because I can access so much of it, however I want.”

The music industry has a new Internet problem. A decade ago, the major record labels began to worry about online piracy, in which people illegally swapped music over peer-to-peer networks like Napster (BBY) and later LimeWire. Partly in response to the piracy threat and partly due to sliding CD sales, music companies began to experiment with licensing their records to new online services.

The idea was that services like Imeem, Last.fm, and Pandora would let people listen to music on PCs, mobile devices, and home stereos, while collecting small fees and advertising revenue that the services would share with labels and artists. Music fans would be discouraged from stealing tunes, and the major labels—Warner Music Group (WMG), Sony Music, Universal Music, and EMI—might even get a sales boost as listeners discovered new kinds of music.

More here.

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11 Responses to The Music Industry’s New Internet Problem

  1. Andrés Linares February 5, 2015 at 9:54 am #

    The music industrie has always been comforting with the internet, since music was able to be downloaded. Which once was the major way of winning money for a musician is now the less, selling there music is now just an extra, because of illegal downloads. Illegal downloads made CD’s a struggle for artists, making them sell there money for less now, so music apps like, Pandora or Spotify can distribute it legally but cheaper.

    Now days artist have to be artists, not just singers, they have to really perform, since now the only way to become millionaires as it was before selling CD’s, is selling their concerts. A great example of the fight against this illegal distribution or this drop of prices for music, what people doesn’t realize is that music is art, is causing big artist through the world, just to give for free their music in internet, but their real music not fake, cheap copies. This movement was started by Calle 13, a music group for Puerto Rico, this rap/politics group made artist do the same for one reason, when they copy the music, a music archive is very heavy because it has tons of work in it, to distribute it in the internet, the copies are cheap, and the final product which was art is going to sound just heap with not any work in it, so they prefer to give for free their music but for people to have the real deal.

    Music will always live, and music will always inspire people, and make us come together, so this is the time where we have to come together and maybe use the apps, because they are legal, if is possible buy their music and appreciate their work, but we have to unity and stop downloading illegal music, is stealing from an artist

  2. Andres Arcila April 26, 2015 at 1:11 pm #

    This article talks about the new era of music and how the industry works. Music is not anymore and industry that make money by selling CD’s, the internet ended with this sells. But not everything is negative, internet has being useful for singers and managers in communication. how does this benefit singers and managers? well, with internet is easier to contact people and contract them, make deals to give concerts and worldwide tours. This is what is giving the most revenue now to the music industry.
    In my personal case and do not pay for music, there is many apps that you can download free music or you can listen to them online. There is not a struggle anymore to listen to new music, you can listen to new songs even the same day the singers release them by paying not even 1 cent. It is free!
    Also this help singers to be known, some music is not commercial or able to all type of public so radio station do not play them, but in internet you are free to listen to whatever you want with real lyrics.

  3. Kevin Giron April 28, 2015 at 9:06 pm #

    I remember when I was younger and my brother would buy CD’s when they were released and put them in a case that he kept in his car. My older sister would illegally download music from limewire onto our desktop and eventually make a mixtape. How the times have changed. I never physically or virtually purchased music nor have I ever downloaded music illegally, the reason being is that the music industry and the internet have developed to a point where I can download a free app and have access to all the music i want.

    There are less people than ever downloading music illegally and that is because there is less incentive to do so. Spotify is a common app to stream music, it is a free app but you can purchase premium for $10 to avoid advertisements and commercials. The music industry is receiving a boost in sales as more people are getting exposed to their music. The internet was once viewed as a problem by the music industry but now with more people having access to the internet and smart phones the music industry is benefitting.

  4. Joe Iuliano April 29, 2015 at 10:41 pm #

    This article interests me tremendously because being heavily involved in the music industry, we see the effect that the music world is unfortunately going through. When artists come out with music they want their music to be purchased on iTunes. Notice when I said purchased because they earn compensation from as many buyers that buy their songs or albums. On top of that they earn more money when their music is on the top charts or albums, but that is lacking from users downloading music through online networks like limewire and frostwire.

    Apps like spotify, soundcloud, and many more music apps that allow you to listen to new music and pretty much any song you would like to listen to legally are now becoming more and more popular. It also allows you to share music with other people so your music knowledge will increase because now artists are going to get paid off views and plays on each of these apps with their music on it. It is also available on internet browsers too but the music industry is now trying to find better ways for people to listen to music without doing it illegally.

  5. Nicolette D October 10, 2015 at 10:42 pm #

    Reading this article and other’s comments, I can tell a lot of people are into music and love specific types. I enjoy all types of music. I think music is all about how it makes you feel. Country music relaxes me, electronic makes me want to get up and dance, and hip-hop just makes me feel happy on a bad day. I can literally listen to anything! You name it and I already love it!

    I believe that the music industry is constantly facing financial issues. For the longest time now, more and more people have chosen to download music or listen online. It’s becoming a lot less likely for individuals to buy CDs. Majority of people own iPods or MP3 Players, so a CD is not desired. I really just feel like this is a hit or miss for the industry. Artists are still getting their names out there and becoming more popular, but they’re unable to sell out CDs. However, artists and groups in the industry act accordingly by putting their music on apps like Pandora or Sound Cloud. At the same time, because of the Internet, no one wants to buy their next new album. They spend so much money on the advertising of their new album, when their fans can already hear it online. For many new artists or artists just emerging and becoming big, websites like these and leaks of early releases get people attracted. Many artists would have much success if it weren’t for the illegal downloading with LimeWire or the YouTube to mp3 sites. Everyone’s losing interest in paying for a CD, when they can get it for free in a couple clicks. Overall, this Internet crisis affects the music industry’s profitability.

  6. Will Nguyen October 11, 2015 at 4:11 pm #

    After reading this article on the methods and cost effectives of downloading music, there are two ways to look at it. One way is the business side. The companies who produce the music are doing so to make money off of it. Itunes, Pandora, Last.fm, etc buy the copy rights of the song from the owner and host it on their stations/store for a fee. In this case Itunes sell songs at $1 per song and Pandora has a monthly fee they charge their users to listen to music. This is acceptable price for music; however the other side is us, the consumer side. Of course we all have multiple songs we listen to; my friend has 300 songs on her Iphone. But does she really want to spend $300 + tax just for these songs? Who would want to? So like many other people she would rather get songs some other way than pay $300. The small Pandora monthly fee is not a bad deal but the downside to that is you do not have full control on what songs you want to be played. Music industries will do whatever they can to profit from their music but in the end with today’s technology there will always be a way to distribute music freely over the internet.

  7. Matthew Begley October 12, 2015 at 12:02 pm #

    I agree with the article that music labels should be worried about the large and still growing presence the internet plays in the music industry. While the music industry has effectively used music distributing applications such as iTunes and Pandora to get the music out on a global database that everyone has access too. This also eliminates that problem of going through greedy distributors to get their CDs and albums out there. However, the profit margins going through these sites and applications are rather small. It also gives people the option of buying individual songs instead of entire albums thereby reducing profits even further. By going through online sources as it has pointed out runs that risk of being illegally downloaded or leaked for free. If you put in online you have to be prepared for it to be hacked. Companies are getting frustrated and upset that people are getting these songs for free however, when sites are charging over a dollar for one song people who buy lots of music are going to be fed up and look for places where they don’t have to pay. YouTube is the primary host for how people can both listen to and download music for free. There are dozens of YouTube to MP3 converters online that can convert YouTube videos to MP3 files for free.
    While I believe that music labels have been smart using the online sources to gain global recognition for their artists and their music, they have to use other methods in order to get people to want to pay for the music. There are a few solutions to accomplish this one being controlling a better quality of music that is only available for people to purchase and can’t be downloaded for free.

  8. SSchneid October 14, 2015 at 2:18 pm #

    Often, when individuals make the choice to access music for free it is because they are missing out on the bigger picture. This article highlights what that bigger picture is. Looking at music sources such as Spotify that offer streaming for a price of $4.99 per month for college students, could not possibly provide enough compensation for the amount of music that is being played. Therefore, there is a discrepancy between the production and compensation of music. In my mind, the industry has changed form one of appreciation, to one of convenience. I remember when I was growing up, going to Barnes and Noble with my parents, and listening samples of CDs in the music section. I enjoyed that time of discovering new and old music, and the purchase of a new CD. With the age of the internet, the idea of going to Barnes and Noble to explore and discover, has been replaced by a few clicks of a mouse and previews on iTunes.
    According to the article, music sales are down in general and I find the internet completely to blame. It is nearly impossible for industry professionals to keep up with all of the illegal and legal music sharing websites. Therefore, industry workers are missing out on compensation. Not only do the artists lose money, but the recording studios, sound engineers, album cover artists, and musicians are losing money as well. It is possible to listen to new songs on YouTube completely for free. Due to this, people are losing the idea that the music industry requires compensation. I still believe in purchasing all of my music, and I subscribe to Spotify for 4.99 a month for streaming. I will continue to do so, because I believe in the value of discovery, and the right to fair compensation.

  9. Qi Li February 26, 2016 at 4:58 am #

    After reading this article”The Music Industry’s New Internet Problem”, it shows a series problem about the new services which is called” The Music Industry” and it also remained me the importance about the music. In my opinion, music is sound, composed in certain rhythms to express people’s feelings or to transfer certain feelings. Dance is physical movement also used to express joy or other intense feelings. It can be anything from ballet to break-dance. In my life music is much more important than dance. I prefer experiencing most things inside my mind. I don’t need psychical movement to experience joy. Sometimes I use music to escape from reality, there is nothing I love to do more than listen to certain types of music that relates to my feelings at that moment. When I am a little bit down, listening to music with messages I am familiar with, is in a certain way comforting for me. As a child, I started playing the guitar. Sometimes when I feel creative I get my guitar and start playing. It is very satisfactory for me to listen to music I make myself. It empties my mind and gives me some kind of satisfied feeling. When I am, for example, in a bar enjoying music, I don’t feel the urge to move my body. That’s why in this essay I will be focusing on music much more than on dance.

    I always have music playing around me. There are a  lot of different kinds of music I listen to. Sometimes I listen to music for the lyrics, sometimes just for the hypnotizing beat. For example in the car, I like to listen to instrumental music, known as “Minimal” This kind of music makes me drive easier and it keeps me focused for a longer period of time. When I’m alone, studying, I prefer listening to instrumental classical music.  That music has some kind of calmness and it has no distracting lyrics, so I can focus on my study work much better. Overall, my choice of music depends on what mood I am in.
    In general, music has a lot of influence and has a lot of forms of expression. For example, you can see, hear and feel music (when it is loud enough). Music can enlighten you, make you depressed or make you think of love. Music can keep traditions alive. I’m pretty sure I will sing the same songs to my children, that my parents sang to me when I was a little child. Music is also known for its ability to “save lives”. People who are very depressed and alone can find comfort in listening to certain singers, bands or songs. Everybody, including myself, has experienced something like this. For example, losing your (grand)parents or lover. Listening to music gets you all the way through the pain. Music can also remind you of how things were. When I listen to old music from the 60’s or 70’s, even I (born in the 80’s) get some kind of nostalgic feeling. Music can also help you form opinions or give you different views of society. Of course music can also deliver poetic messages, or it can just be entertaining. Music changes, because society changes. Think of technological improvement or changing views. One reason why I prefer music much more in my life than dance, is that music does not restrict my thoughts. When listening to music I can create whatever image I want.

  10. Ashley F March 4, 2016 at 1:53 pm #

    Free downloadable music sites and sites that allow users to stream and listen to music for free are in competition with the music industry whose ultimate goal is to make money off of the music produced. This was not always an issue, however the transformation of the music industry over time as a result of technology created this new issue. I remember when I was younger and I would receive CDs of my favorite artists for Christmas, I did not even know all of the songs on the album but my mom had to buy it for me so that I could listen to some of my favorite songs on demand because downloading and streaming individual songs was not an option. A few years later, when iPods came out, I remember creating an iTunes account and paying for each song that I wanted to listen to and not even thinking twice about having to pay. As I got older and discovered sites where I could download music for free, or listen to songs for free such as YouTube, Sound Cloud, Pandora and Spotify, I stopped paying for music because I did not see the need to when I can get everything for free. I have not paid for music in over three years, I do not even pay to have the premium accounts for the sites that I use that offer this option so that you can listen to music ad-free. I even see these sites as a better option than downloading single songs because companies such as Pandora provide you with a large mix of music and even helps you discover new music you may not have heard or found otherwise.

    I think that artists and their labels are partly to blame for this issue because they do not make a strong enough effort to get people to pay for their music. These artists and labels offer the music for free on so many different platforms that listeners see no need to pay. For example, if I really like a song, I will stream is for free on the artists VEVO account on YouTube where they uploaded it. Some may argue that it may be more convenient to just pay the money for the song instead of having to go to YouTube every time I want to listen to it, but to me I see this as the better option. The new creation of Apple Music is even detrimental to the music industry. Instead of users paying Apple per song downloaded on iTunes, users can download as much music as they want and just pay a flat rate per month. As mentioned in the article, “Total industry sales were about $10 billion last year, down from $14 billion in 2000, according to the Recording Industry Association of America” this is alarming for music labels and their artists because the amount of people purchasing music is declining as more technologies develop that give people alternative options. However, there is a positive to these free music sites and streaming platforms, music companies can use the data provided by these sites to figure out how to improve their labels and artists in order to target more people and figure out a way to make money. As stated in the article, Greg Scholl, the president of a large independent music label says, “some of his artists use interactive dashboards to monitor where on the Web their music is being played, and even the demographic group and geographic location of the people playing it. They can use that to answer questions like “Are we missing a market where there’s interest we weren’t aware of?” This is helpful to these artists and music labels and can hopefully eventually help them find a solution to their ultimate problem; declining revenues and business.

  11. Daniel J Cambronero December 6, 2019 at 8:37 pm #

    Music streaming has revolutionized the way musicians and music lovers consume the medium as streaming sites like Spotify, Apple Music, and Tidal all have dramatically changed music. The article was written in 2009 and its date shows how quickly the music streaming climate changes. What was then Last.fm and Imeem, is now equivalent to Spotify and Apple Music. Streaming in the music industry started getting popular after bands realized that selling their MP3 files allowed people to easily steal their music through many types of pirating software such as Limewire and Napster. Many bands such as Metallica came out against music piracy however, other bands such as Radiohead embraced the new age of music. Radiohead released one of their albums online allowing their listeners to pay what they saw fit for the album, many bands have followed suit in Radiohead’s steps, especially those on a platform by the name of bandcamp. Bandcamp, a site designed for small artists to thrive, allows many artists to exhibit their work with very little fees. Unlike before, streaming allows for new and inexperienced artists an opportunity to have their music heard on other platforms such as YouTube and Soundcloud, without being a part of a label or anything. Streaming has even gotten to the point now where artists no longer even need to be a part of a record label to post songs on Spotify and Apple Music.

    Despite streaming becoming the new standard, many still stick to traditional analog forms of media such as vinyl. Despite being expensive, vinyl helps artists more so than streaming their music. Many have criticized how streaming services pay their musicians because often those with hits are preferred as opposed to those making artistic statements however, this age of streaming emphasizes pop music leaving out many other genres. Vinyl still remains relevant as people like to collect their favorite musicians work in the best format and being that I grew up in a town with a record store, I had this constant access to music which inspired me to become a musician. Talking with the workers and seeing what they recommend has allowed me to explore different genres and styles which ultimately shaped me into who I am today.

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