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Two rules to success in life:
1. Don't tell people everything you know.
--Sassan Tat
---------- Forwarded message ----------
Date: Tue, 2 Jan 2001 23:40:27 +0000 (/etc/localtime)
From: Steven Zanvil Sawolkin
To: falstaff@sympatico.ca, cbell73@calvin.edu, abryant@si3.net,
roark@watervalley.net, gadgetdon@mac.com
Subject: Slashdot | The Truth About File-Sharing
The Truth About File-Sharing
Music Posted by JonKatz on Tuesday January 02, @11:45AM
from the -not-thieves-but-consumers- dept.
A series of new studies of Napster users suggests everything you've been reading about
music file-sharing systems is baloney. You're not thieves and pirates, it turns out,
but marketing pioneers and music lovers quite willing to pay for music. These new stats
suggest that file-sharing could have enormous implications for the selling of content,
culture and information online, none grasped by dunder-headed corporations like the
record labels. They are also a reminder not always to believe what you read. (Read
more).
According to the January issue of American Demographics, a magazine which hardly
supports radical copyright-infringers, music sites like Napster have created "powerful
new opportunities for music marketeers." Despite the best efforts of the greedy record
companies and a few recording stars -- Metallica and Dr. Dre come readily to mind -- to
alienate a new generation of music lovers, recent figures prove that file-sharing
services actually generate sales and put more money in artists' pockets.
This has enormous implications for those making movies, publishing books, or creating
any kind of saleable entertainment. It suggests that the Net may work best as a
three-step process: first connecting customers with culture, then generating interest
in cultural and informational offerings, then keeping track of their tastes through
sophisticated new digital marketing research. Theoretically, file-sharing approaches
could go beyond shopping to stimulate interest in education, business, even politics,
if the music experience is any indicator. And it sure ought to be.
The relationship between new decentralized software programs -- Napster, Freenet,
Gnutella, P2P -- and such issues as copyright infringement, artists rights and
conventional retailing is complicated. Legal, political, educational and other
institutions haven't begun to sort through them. But clearly the music industry's
panicky and greedy overreaction will prove one of the most dunder-headed, short-sighted
responses in recent business history. The industry couldn't have been more off-base,
dishonest or greedy.
Nearly 75 percent of college students have downloaded music from the Net, 58 percent of
them using Napster, according to a recent study by Greenfield Online, a Connecticut
research firm, and YouthStream Media Networks. Nearly two-thirds of the 1,135 college
students surveyed say they download music as a way to sample music before buying it.
The proliferation of online music is introducing consumes to artists they don't know,
in almost precisely the same way department stores offer samples of food, perfume and
other retail items. A survey by Yankelovich Partners for the Digital Media Association
found that about half the music fans in the U.S. turn to look for artists they can't or
don't hear in other venues, like radio. Nearly two-thirds of those who downloaded music
from the Web say that their search ended in a music purchase. Music labels should have
been donating money to Napster users, not threatening to sue them and chase the site
off of college campuses.
And the much-libeled Napster users are dedicated music buyers, quick to reach for their
wallets. Jupiter Research says it found that 45 per cent of online music fans are more
likely to have increased their music purchases than online fans who don't use Napster.
The Jupiter study of Napster users found that 71 percent of users say they're willing
to pay to download an entire album.
Interestingly, reports American Demographics, the Jupiter Study of Napster users found
that 71 percent of those who use the site said they were willing to pay to download an
entire album. But in a Greenfield Online survey of 5,200 online music shoppers, nearly
70 per cent say that they have not paid -- and will not pay -- for digital music
downloads. This suggests that subscription-based services may be more likely and
successful than a per-song fee system.
This potentially revolutionary model for marketing culture is about to be dismantled by
the new partnership between Napster and Bertelsmann, which is giving the file-sharing
site more than $50 million to develop software that will charge users for music.
Bertelsmann says it will keep a part of Napster "free," but watch for yourself to see
how quickly it shrinks.
These figures, remarkably, demonstrate that almost every assumption about the free
music movement, reported in most media outlets and used as justification for a wave of
new legislation and legal action like the Digital Millenium Copyright Act, is dead
wrong:
* Most music downloaders aren't thieves or pirates but music lovers willing to pay
for music.
* Artists have made more money from this new generation of music lovers than they
would have without them.
* The true significance of file-sharing wasn't an end to intellectual property, but
an exciting new way to develop markets.
* Record companies and other corporations should be supporting file-sharing sites
ratherthan hiring lobbyists and lawyers to intimidate, sue and enrage new and eager
customers. College students have nearly universal access to broadband, and are
tomorrow's mainstream consumers. The more information and culture they have access
to, the likelier it is that they'll sample new venues, products and information.
* Evidently, file-sharing isn't a dangerous menace but an effective new method of
disseminating -- and selling -- content, and culture. Aside from these new
findings, the Napster experience also suggests that when it comes to dealing with
the Net, businesses often have no idea what's good for them.
And oh, yeah. Don't believe what you read about yourself.
