Claims from the music industry that piracy is responsible for its woes have been dismissed by the economic thinkers at the London School of Economics.
A paper written by Bart Cammaerts and Bingchun Meng contends that the decline in sales of physical copies of recorded music cannot be attributed solely to file sharing.
According to AP, the paper said that the music industry was hit by a perfect storm of different factors including changing patterns in music consumption, decreasing disposable household incomes and increasing sales of digital content through online platforms.
Meng and Cammaerts said that efforts by the music industry to suppress the use of technological advances like peer-to-peer file sharing in order to protect out-of-date business models had stifled innovation in the industry.
To make matters worse, such efforts were about as useful as a chocolate teapot at stopping piracy
Instead of dragging people to court, the Industry should have focused on harnessing such technologies to provide “user-friendly, hassle-free solutions to enable users to download music legally at a reasonable price”.
What it did, was slag off file-sharing and bring in regimes of copyright protection which threaten to stifle the very same creative industry copyright law aims to stimulate, the researchers found.
The industry has been chosing to ignore some very important figures. While their cash has declined the revenue earned by artists from live performances has been increasing. Figures from Britain for 2009 show that the live music scene, at around £1.54 billion, was actually larger than the music recording industry, worth £1.36 billion.
Recent moves by the industry to embrace new technologies like online streaming services appear to be bearing fruit and converting illegal downloaders to legitimate services, the paper found.
This report follows a similar finding by the University of Minnesota whose economist Joel Waldfogel found there was no evidence that the quantity of new recorded music or artists had been affected by file-sharing over the last ten years.
Much of the piracy in developing countries was the result of charging people far too much.