brettcooper-deactivated20101121Apr-01-2009 12:02pm
China: Our Digital Future?
A number of recent events taking place in and around the music industry have had me thinking about music’s digital future. First, we have the news yesterday that Seeqpod, a playable search service that essentially crowd-sourced streaming music from around the web, has been “bullied” into bankruptcy by the RIAA. Secondly, we have the announcement that the Pirate Bay, who are themselves in the midst of litigation, have added the ability to tag/share their torrent links on Facebook. And finally, we have Google China partnering with WMG, Sony, EMI and Universal to distribute completely free digital music in that market, one in which upwards of 99% of all digital music downloads are pirated. The vision, is to exchange a percentage of ad revenues for the rights to distribution.
In my mind, these events can be grouped together to form a vague outline of the coming revolution within the current music market, starting with the shutting down of legal services like Seeqpod, progressing to Pirate Bay’s “arming of the populous” by essentially turning a mainstream platform like Facebook into a Peer to Peer index, and ending with the acquiescence of the few to the many, i.e. the record industry and Google’s page views for free downloads scheme in China.
Seeqpod is no more in spite of the fact that it sourced most of its music from major sites like Youtube, Vimeo, and others. This kind of indexing is not strictly illegal, especially when you consider that Google will return most if not all of the same search results that Seeqpod would have on a song by song basis, but according to the DMCA the problem was Seeqpod’s additional functionality, which allowed for the creation of playlists out of search results. Ultimately the company was just too small to deal with the weight of the legal pressure being brought down upon them and had to close, although as a last stand the team have sold copies of their API to a number of other groups at $5000 a pop, so no doubt we will see about a dozen other equivalent websites soon.
The difference between Seeqpod and my next example, the Pirate Bay, is that while Seeqpod indexed and played content for their users directly without allowing for direct downloads, the Pirate bay points people in the direction of what they are looking for, allowing for illegal acquisition and but leaving that decision in the hands of the users themselves. The preference of users is made clear by comparing popularity of the two methodologies. In a period of one month an average 170,000 visitors frequent the Pirate Bay from the US alone (a number which is growing steadily), compared to just 25,000 globally for the far more benign Seeqpod, in spite of the fact that most of the torrent directories contained within the search results point to illegal content. The site claims it is clear of any wrongdoing as it merely acts as a search engine that directs people to search results that other users are responsible for hosting. Naturally, the MPAA and the recording industry have brought huge lawsuits against the site’s founders, a move that if it succeeds will only result in hundreds of thousands of frustrated consumers. The fact that use of the Pirate Bay and other sites like it is growing indicates that this is now the preferred delivery mechanism. People want this stuff for free and they expect it. The addition of Facebook linking functionality to the Pirate Bay’s search results is a genius “up yours” move to introduce torrent distribution to a network that now boasts 15 to 20 million visitors a month. If even a small percentage of that mainstream user base catch the torrenting bug, then the recording industry will have to face down millions of frustrated music consumers instead of thousands.
Watching the report above really demonstrates that, if anything, the Pirate Bay is almost a proof of concept for free music, especially considering that the central point in the record industry’s lawsuit is that the creators of the site are profiting off of content they don’t own to the tune of millions of dollars a year in ad revenue, and all based on a user base that is pretty small in the grand scheme of things. What is particularly fascinating is the news that Google and four major record labels are banking on employing essentially the same model in China, where statistics show a 99% piracy rate for recorded music. The scheme would see Google splitting its ad revenues with the content holders in order to gain a greater portion of the search engine market.
When you consider that even the RIAA has announced that it knows that it cant hold back the tide with legal action much longer, its moves against sites like Seeqpod and the Pirate Bay, as well as its lobbying efforts against projects like Pandora seem remarkably short sighted. Perhaps even they realize this is the case, as the Google experiment looks like a test case for the distribution model of our digital future in the West. It is a fact that an increasing number of the core consumers of music are growing up in an era where acquiring it for free is second nature. We will not ever be able to change that behavior and only by adopting a strategy that allows the music to feel free while in reality paying for itself indirectly through other means (the third kind of free Chris Andersen described in my earlier post) will the industry be able to grow and prosper. Other Western media industries have managed to hop on this bandwagon early, just look at Hulu.
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