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Williams 1 Matthew Williams Mrs. Chambers British Literature 21 November, 2014 The effect of music piracy on the music industry Inventor Steve Jobs once said, “It is piracy, not overt online music stores, which is our main competitor.” In this modern era, music piracy is primarily distributed by illegally downloading music products from the internet or distributing music in the form of mp3 files with friends. This negative anomaly can cause devastating losses to both the music industry and anything relying on the music industry. Music piracy directly impacts the music industry by limiting the number of records sold, harming the United States economy, and wasting money spent on trying to attack piracy. While some still believe that music piracy does not affect the general population, more and more people are beginning to realize that music piracy is affecting us indirectly. Music piracy affects not only the artist but also a large number of people working for the music industry by decreasing the amount of available jobs. James D. Torr, an editor at a San Diego newspaper states that, “stealing music compromises the livelihood of musicians, songwriters, record store owners, and employees—basically everyone in the music industry” (Torr). Music piracy directly affects the artist because people would much rather download a few songs for free rather than pay a dollar and twenty-nine cents for one song or twenty dollars for a whole album. Moreover, musicians, songwriters, singers and producers do not obtain any fees they earned from the production of their albums because of the illegal distribution of their Williams 2 products by music pirates. According to Noah Berlatsky, “Several cases in France show that local artists have to work more than two jobs due to the illegal production of their music” (Berlatsky). Indeed, some artists are experiencing a bad reputation by critics and fans because of the poor and inferior quality of pirated work. Due to music piracy, artists may soon have to make live performances just to make a living. There is no doubt that internet exposure can be beneficial for new artists, but there is a difference between helping the artist out by buying his or her work and downloading their entire album for free online. Making records is an expensive undertaking if fans are not willing to support his or her favorite bands and buy their music rather than pirate it, then record companies will find it more difficult to commit the kind of resources it takes to discover and develop new talent. A substantial amount of income does not even cover the costs producing a considerable amount of albums and records. Music piracy is very detrimental to the music industry by shortening the number of records sold, therefore, reducing the amount of money companies can spend to make music that audiences enjoy. As a result, this may cause recording labels to go bankrupt or lay off their employees. Honest retailers are also losing to music piracy. They are at a loss because they can not compete with pirates who sell their work for a tenth of the original price, and sometimes even for free. The invention of the iPod and mp3 players also harms retailers because consumers find it more convenient to purchase, or illegally download songs on the internet for free. To conclude, the loss of money that results from music piracy takes away jobs and accounts for the abundance of lost profit to the music industry. Williams 3 The entertainment industries are a thriving, if often overlooked, part of the United States economy. Music piracy directly impacts the United States economy by decreasing the nation’s Gross Domestic Product (GDP) and costing workers over ten billion dollars in lost tax revenue. “One credible study by the Institute for Policy Innovation pegs the ANNUAL harm at twelve and a half billion dollars in losses to the U.S. economy as well as more than seventy thousand lost jobs, and two billion in lost wages to American workers” (Storrs). Music piracy has really taken a toll on the United States economy by taking away jobs and causing a loss of twelve and a half billion dollars in tax revenues. Music piracy has become a worldwide phenomenon with the help of the internet providing a faster, easier, and more efficient way to pirate music. Because of this, a negative impact can be seen on not only the United States economy but also countries like France and Spain. It is estimated that nineteen percent of the United States internet population currently downloads music illegally from file sharing networks or other sources on a monthly basis (Berlatsky). It is reported in a study by Stephen E. Siwek that, “the United States government and its citizens lose four hundred and twenty two million in tax revenue” (Siwek). Siwek goes on to states that out of the four hundred and twenty two million in losses, two hundred and ninety-one million are personal income taxes and that one hundred and thirty-one million in corporate income and production taxes. It is predicted that the direct loss in employee earnings in the United States sound recording and retail industries that result from pirating is one billion dollars. The direct loss in employment at these industries was approximately twentyseven thousand jobs. Because of all these losses, the United States economy and citizens of the United States are to suffer. They suffer because the United States government has to account for all the losses, which increases the taxes that citizens have to pay. To summarize, music piracy is Williams 4 a threatening issue that harms the United States economy by reducing the amount of available jobs for middle class workers, and causes a significant loss in tax revenue. Music piracy precisely impairs the music industry because organizations and governments, including the United States government attempts to attack piracy. In the end governments and organization waste money trying to attack the problem but can’t stop music piracy. People all around the globe pirate music everyday despite the attempts from various governments and organizations pursuing to stop it from happening. Organizations and acts such as the Recording Industry Association of America (RIAA), the Institute for Policy Innovation (IPI), and the Stop Online Piracy Act (SOPA) are just few of the various attempts to try and stop music pirates and pirates in general. The truth is plain and simple, music pirates are not able to be stopped as long as there are alternatives to actually buying a legal copy of a song. In the digital era that we live in today, music pirating has become easier than ever because anybody can record a song and upload it to a website that can not track the original posters location. With that being said, attempts are still made at stopping pirates even though these organizations know that there is really no possible way to stop these music pirates. The infamous Recording Industry Association of America (RIAA) spent sixty-four million dollars in lawsuits to only receive a total of three hundred and ninety-one thousand dollars from music pirates. In other words, the RIAA spent over forty-five times on lawsuits and threats than what it received in return. With such a deficit like that, most companies and businesses would be bankrupt from losing that much money but the music industry seems more than obliged to keep pouring money into this bottomless pit, as they feel that they are preventing an even greater loss from occurring. Another example of organizations attempting to rid the world of pirates but failing is when the RIAA sued two hundred and sixty-one music fans for sharing songs on file sharing networks. “Five Williams 5 years later, the recording industry has filed, settled, or threatened legal actions against at least 30,000 individuals. These individuals have included children, grandparents, college professors— a random selection from the millions of Americans who have used P2P networks” (RIAA). The RIAA spent ANOTHER combined one hundred and twenty-seven million dollars on these lawsuits alone. Among those sued was Brianna Lahara, a twelve year old girl living with her single mother in public housing. Brianna was forced to apologize publicly and pay two thousand dollars. When agencies spend a considerable amount of money, say perhaps one hundred and twenty-seven million dollars, to be compensated with only two thousand dollars, then agencies should realize that targeting citizens with lawsuits isn’t cost efficient at all. Has the arbitrary singling out of nearly 30,000 random American families helped promote public respect for copyright law? After five years of threats and litigation, the answer is a resounding no. These are few of the many examples of how the United States government and governments around the world waste money trying to tackle a problem that can not be tackled. In conclusion, music piracy is a force to be reckoned with. It has been proven that music piracy harms artists and an obscene amount of people working for the music industry. It impacts them because twelve billion dollars in profit is lost, and seventy thousand jobs are lost due to music piracy. These facts directly harm the United States economy and economies around the world because it affects their Gross Domestic Product and accounts for a loss of jobs leading to inflation. Another way that the music industry is impacted is by government agencies that have good intentions to combat music piracy, but only provide a loss of profit by their countless lawsuits. Music piracy not only affects the music companies and artists, but it also brings negative effects to all of us as well. In the end consumers also end up as one of the victim under Williams 6 the negative impact of music piracy. Hence, everyone should stand against music piracy so that this negative trend will end in one day. Williams 7 Works Cited Berlatsky, Noah. "Illegal File Sharing Hurts Musicians and Society." Gale Virtual Reference Library. Gale, 2010. Web. 05 Nov. 2014. Hatch, Orrin. "Internet Piracy Threatens the Entertainment Industry." Gale Virtual Reference Library. Gale, 22 July 2004. Web. 05 Nov. 2014. "RIAA v. The People: Five Years Later." Electronic Frontier Foundation. Eff.org, 30 Sept. 2008. Web. 05 Nov. 2014. Siwek, Stephen E. "The True Cost of Sound Recording Piracy to the U.S. Economy IPI Issues Institute for Policy Innovation." The True Cost of Sound Recording Piracy to the U.S. Economy IPI Issues Institute for Policy Innovation. N.p., 21 Aug. 2007. Web. 05 Nov. 2014. Storrs, Beverly. "Piracy Is Stealing and Affecting Music Industry." U N I V E R S E. N.p., 21 Feb. 2012. Web. 05 Nov. 2014. Torr, James D. "Online Music Sharing Is Wrong." Gale Virtual Reference Library. Gale, 17 Dec. 2003. Web. 5 Nov. 2014.