Since the dawn of the digital age, the music industry has succumb to a new form of shoplifting – online piracy. While pirating music is not a new concept along with the Internet, downloading music without paying for it is occurring at a much greater magnitude than the pre-internet days. As an Economics major, I wonder how much this phenomenon affects the music industry. So I ask the question: Should you really be torrenting?
As a disclaimer, I do not condone piracy. It is a crime, no matter if you think that you are justified in doing so because certain musicians already “make millions” and your one illegal purchase won’t make a difference. This is a widely held belief, and economically, it makes a bit of sense. In such a large market, a few sources of lost revenue do not affect the artist greatly. In this mindset, the benefit to you far exceeds the costs towards the artist. However, if everyone thought like this, and many people do, then we see real effects. According to the RIAA, it totals to about $12.5 billion in annual losses to the US economy, equating nearly $2 billion in lost wages.
There are of course many other digital files that can be downloaded besides music, such as TV shows and movies, that also contribute to the effect of piracy on the economy. Specifically to music, however, there are many arguments saying that downloading music for free actually helps the industry and artists more. According to this study, there has been less revenue coming in from recorded music in recent years, meaning that the recording industries, rather than artists directly are being hurt. Despite this, concert sales have increased and the spread of free online sharing has helped to give many musicians a new level of exposure.
As described by the video above, pirating does not seem to come to an end, even after policies are implemented to shut down popular sites like The Pirate Bay. As with the shutting down of most markets, black markets tend to form and people will continue to the illegal practice as long as their incentives hold. The likelihood of getting caught for torrenting is quite low, and thus many people continue to do so. And as this Forbes article mentions, perhaps recording industries and musicians should consider lowering the price of music to a value that would align with consumers’ interests.
So in the end, should you participate in online piracy? From a legal standpoint – no. From an economic standpoint – maybe. Just note that there are many legal options in place of pirating, such as SoundCloud or YouTube that can get you the music you want for little to no cost to you.