Do you download music? If so, do you pay for it? Amazon, iTunes Store and Napster, among others, sell music downloads; simple to use, fast and legal. However it is estimated that 95% of music downloads are illegal. (IFPI 2009)

Recently four directors of the Swedish file sharing website, The Pirate Bay, were arrested, found guilty of ‘aiding and promoting copyright theft’ and sentenced to jail. There are powerful interests opposed to file sharing of music, TV and Movies.

In a simpler age, Sir Paul McCartney sang “You never give me your money”. But in fact millions of people did, and plenty are still doing so; he recently pronounced the Pirate Bay verdict to be fair. However in a previous interview, Sir Paul (almost) admitted he would have ripped off music by Elvis and his other heroes if he’d had access to today’s technology back in the day (and I don’t think he meant that would only have applied to a few ‘scouser scallys’ either…) Herein lies the dilemma; is theft of IP the same as stealing money? Or a car? Or a DVD? Just because it’s possible and un-policeable, should the copyright owners (music labels, movie studios, artists et al) give up and find another job?

Indeed, why should everything on the internet be free? Shouldn’t talented people be able to earn a living by entertaining others? If not, who will choose to be: Actors/ Producers/ Musicians/ Journalists? Next time our mate offers us a memory stick/ DVD loaded with pirated content in the pub, should we pause to consider whether we may be stifling the career of the next Lady GaGa (actually, on second thoughts…OK bad example.) MySpace Music, and new sites like Spotify, (as well as smaller rivals e.g. Deezer, Qtrax) are rewriting the rule book. Many questions remain: will advertisers support the new legal sources of free music? Will consumers accept some ads as their price for getting their favourite music for nothing? Will the premium services sell?

Of course the music labels were in a difficult situation; the technology moved so fast that they lost the initiative and lost control. So did they give up or fight? The former was commercial suicide and thus not an option. But how to fight? The internet is not going away. File sharing will only get easier. DRM (Digital Rights Management) is both universally hated and fraught with difficulties (e.g. how many computers can you download the protected track onto? If 3 computers, is this admitting that you and 2 mates can have the song for your 79p? What happens if your laptop is stolen or your hard drive crashes?) So, perhaps the best alternative model is that you pay once then the music is yours forever. The retailer (e.g. Amazon or iTunes) is tacitly accepting that you will share with your mates but at least ONE of you has paid! DRM-protected music is now effectively finished, with both iTunes and Amazon’s MP3 download service abandoning it. Some would say the Music Industry, under pressure from market forces, has at last accepted reality.

Strange things are happening at the moment. Madonna has done a ‘360 deal’ with concert promoter Live Nation; recorded music sales are way down the list of the ways she will make money. Radiohead invited us to decide how much we wanted to pay for In Rainbows (I still feel uncomfortable about what I paid, but I don’t think I should, having paid top-dollar for their previous albums). Lily Allen, Kate Nash and the Arctic Monkeys broke on MySpace and YouTube. happily gives his music away and makes money from touring and merchandise.

As we have noticed, there is a recession right now; indeed Sir Elton John and Sir Paul McCartney each just lost £60 million of their net worth. But we shouldn’t worry about these Rock Knights. They’ve made their money and they can make more from touring, advertising, publishing, sponsorship and merchandise.

There is something much bigger going on here than the current recession. It’s the new up-and-coming acts who might just find it too tough to break into the mainstream i.e. to make it pay so that they give up and as a result less new music is made and all we are left with is the Knights’ back catalogue, Sir Cliff’s latest Christmas Single (on mp3 and vinyl naturally) and the winning song from the latest TV talent contest.

Currently, what has happened in Music currently shows few signs of happening in TV/ Movies. The movie and TV studios are currently fighting tooth and nail to stamp out piracy; they want you to go to the Movies, buy the DVD, or at least rent from someone who has bought it. Maybe they will move their position once people stop buying DVDs as they have done with CDs. Until then DRM is very much alive as regards video content. DVDs now come with an anti piracy warning; “You wouldn’t steal a car…handbag…mobile phone…piracy is theft” etc. Strong stuff.

Throughout history, technological change has caused upheaval and conflict, as established structures, industries and personal fortunes are threatened and even wiped out. The Luddites fought against mechanization of the mills. There was a powerful lobby defending the canal industry when it became threatened by railways. However machines and railways won. Today, Newspapers and Travel Agents are struggling as consumer habits change. The internet has compelled the music business to re-evaluate its business model; once again technology has forced changes in the economy and indeed in society. Maybe the movie business is next. As we all know, the internet is a powerful agent of change and it seems certain that we “ain’t seen nothing yet”.