The latest issue of Entertainment Law review has a comment piece by Keith Bottomley of Bircham Dyson Bell entitled “Allofmp3.com – the legality of Russia’s online black market. An interesting read. The tone generally says allof mp3.com is bad, but it concludes “the activities of allofmp3.com in Russia are within the strict interpretation of its licence and the Copyright Law and the Copyright Law may not in itself contravene any of Russia’s treaty obligations”. However, it adds that in selling outside of the Russian territories it is breaking the law of many other countries.
I have written about allofmp3 on these pages many times. On the one hand, I can understand the principle that organisation such as the International Federation of the Phonographic Industry (IFPI) et al are trying to uphold, in going after allofmp3 etc, but on the other hand I’m not sure how this stance is benefiting the artists whose interests they claim to represent. They say their artists are loosing out financially, yet they have refused offers to accept money from the Russian collection societies (ROMS/NP-Fair). They says the ROMS licence is not legitimate – even in Russia, but are always quiet on NP-Fair’s status, and allofmp3 also had a NP-FAIR licence.
Is the key is the royalty rate? ROMS currently offers 15% whereas NP-FAIR raised their rate to 50% late last year. I’m not sure what others in other countries are paying, but if it is anyway comparable then any sympathy I have with the record companies (or more to the point, the artists on whose behave they are acting) disappears. As my Dad used to say, 0% of nothing is nothing.
Is it just a matter of price? Are they just upset that people can buy tracks for under 10 pence each? People are always pointing to the cheap cost of tracks on sites like Allofmp3.com. So, let’s have a look at the reality for a second.
Let’s take random 4 minute MP3 track by Random band at128 kbit/s on allofmp3.com. The cost 6-8 pence.
The same song downloaded from the iTunes Store at the same bitrate costs 79-99 pence.
The same song again (if an indie release) downloaded from eMusic (on my account which offers 90 tracks for £14.99 a month) would be 16 pence (if I download my maximum number of tracks per month).
Also it is worth remembering that allofmp3 offered more opportunities for increased revenue for IFPI and co through the availability of downloads at different bitrates and in different formats. For example, when I used the allofmp3 site last year I chose to download a 256kbit/s or 368kbit/s so would personally be being paying about 12-18 pence a track – essentially no different from what I am paying eMusic. And yet the IFPI is choosing not to collect money for its artists.
All this comes as 2007 Digital Media Survey, carried out by Entertainment Media Research in conjunction with media lawyers Olswang revealed an increase rather than a decrease in illegal downloading and a drop in legal downloads. Further statistics show a steady growth in single downloads, with people seemingly ignoring buying whole albums digitally. It doesn’t take a rocket scientist to figure out why this is.
If I can buy the physical CD for £8-9 in the supermarket or music store, why would I pay £7.99 to download just the tunes, at lower quality and without the advantages of owning the physical product??? eMusic – and I’m sorry music industry, but Allof mp3.com – have got it just about right on pricing. Want to cut down drastically on illegal downloading? It is easy – reduce your prices to a level where people will prefer to actually pay than illegally download.
Yes, I’m sorry that does mean drastic cuts in price per track/album; but this is money saved: Illegal downloads fall, legal downloads grow (and habits form) and with more people downloading the tracks because they’re cheaper I would bet money that overall there will be no loss of revenues for the recording industry, indeed most likely the opposite will occur – they’ll make more money. Even a move to just to cut the price of a full album download to make that more appealing than cherry picking your 3-4 favourite tracks from that album to download would work.
As I write this I see that Mark Mulligan commenting on Terra Firma’s purchase of EMI also suggests the only way forward is for a radical change in pricing structures. Will the industry listen before it is too late? Is it already too late? Do you care? Do I care? (yes, as it happens – I still like owning ‘albums’, but then maybe I am out of touch)