Critically assess the strategy of the music industry in response to the problems of file sharing.

Critically assess the strategy of the music industry in response to the problems of file sharing.

While the empirical evidence of the effect of file sharing on sales is mixed, many studies conclude that music piracy can perhaps explain as much as one fifth of the recent decline in industry sales. A displacement of sales alone, however, is not sufficient to conclude that authors have weaker incentives to create new works. File sharing also influences the markets for concerts, electronics and communications infrastructure. For example, the technology increased concert prices, enticing artists to tour more often and, ultimately, raising their overall income. Over the past 200 years, most countries evolved their copyright regimes in one direction only: lawmakers repeatedly strengthened the legal protections of authors and publishers, raising prices for the general public and discouraging consumption. Seen against this backdrop, file sharing is a unique experiment that considerably weakened copyright protections. While file sharing disrupted some traditional business models in the creative industries, foremost in music, in our reading of the evidence there is little to suggest that the new technology has discouraged artistic production. Weaker copyright protection, it seems, has benefited society1.
Music companies fought the introduction of radio in the 1920s, fearing the new medium would provide close substitutes to buying records. Since that time, the numerous attempts to bribe radio stations in the hopes of influencing playlists suggest the industry has come to see radio as an important complement to recordings.