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Effect of Digital Piracy in Music Industry

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Music is always around us whether or not we tend to adore it. It has become a tool for relieving stress and tension and has become a part of our life. People tend to use it as a tool to relax and is a subconscious buying tool in shops. About 25% of the lifetime of westerners are spent in registering, monitoring and decoding music. It has been accepted as ‘Lingua franca” among most of the world’s youth population. Since the late Nineties, the music trade has been undergoing a large amount of serious and crisis-ridden changes. This era was launched and driven forward by a brand new set of technologies: digitalization, data compression and the Internet.

Piracy as the word means is a deliberate violation of copyright of a person’s original work on a commercial scale. Every year it has been noticed that there is a decline in the sale of physical musical albums due to online music piracy. According to Several studies, there is a decrease in physical album sales due to online music piracy. The remainder of the paper is organised as follows. Section 2 deals with a brief discussion on methods of piracy, section 3 discusses about the effect of piracy on the industry and section 4 deals with the conclusion.

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Methods of Piracy

The following are the methods of piracy which are adopted by users and consumers all over the globe.

  1. Digital piracy
  2. Peer-to-Peer
  3. Local Area Network (LAN) file sharing
  4. Digital Ripping

Digital Piracy

The record companies face a barrier in their growth and investment due to the digital piracy. According to the International Federation of the Phonographic Industry (IFPI), a number of unauthorised information are being downloaded by users across the globe which amount to about 28 percent of the global internet user population. According to Universal which is one of the giants in the music industry, the significance to curb digital piracy is increasing to a greater extent as it hinders the distribution and growth of the industry to a larger extent.

Peer-to-Peer (P2P)

According to the (British Phonographic Industry), P2P enables computers to be connected over the internet to enable transfer of files between them directly. P2P became identified worldwide through the employment of file sharing systems and applications which includes the Napster and Kazaa used in the late 1990 and 2000. An unidentified environment of networks is created by P2P to share files. Napster which was prosecuted for using P2P, originally initiated P2P by creating a centralised search facility for files. In this search multiple clients are being connected to a single server.

In this centralised model, a client will request information from the server and the information obtained will not be shared among its other parties. Since Napster was sued in 2001, a number of sites started P2P models. In this decentralised model, every client acts as hub for other clients in the network thereby removing the need of a central hub.

Local Area Network (LAN) File Sharing

A LAN is a type of network that makes computers to communicate between each other within a limited area such as a home, school, computer laboratory, or office building using network media. This type of connection is extremely useful in buildings having a large number of computers used by a relatively fair number of young population with fast internet speeds.

Digital Ripping

Ripping is a process in which the digital audio data which is stored in a particular format is converted in to another format for sharing purposes. For example, the data stored in a CD can be converted to MP3 format which can be used for sharing among users at a later time. This method of sharing is useful if the user needs to replicate the files.

Effects of Piracy on the Music Industry

Illegal downloading or piracy has prompted the music industry to have much less investment alternatives and possibilities to recruit and increase new expertise. Recording companies at the moment are pressured to fund on proven artists. As a result, new talents face a more difficult time and have to look for outlets to create and sell music on their own, which includes promoting it off directly on line. Recording companies usually pay advance amount to the artists and when the album sales hit a peak, they are able to recover the advance amount paid. As the music sales decrease, record companies are forced to offer fewer and lower advances. When the work of an artist is illegally downloaded neither the artist nor the recording company is able to make money due to decrease in sales of the music album which leads to the death of this industry.


At the end of it all, unluckily illegal music sharing is something that is still continuing thereby stopping the industry from reaching its peaks. People will always choose to go for the cheapest option available. Also, with the involvement of common search engines, it will remain an undeniable practice. The solution to this practice

can be to use services provided by companies like Spotify, Tidal and Apple music who are finding flexible and creative ways to deal with this problem.


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