On Air, On Sale, Off Piracy

Mark Kohras is a JD candidate at Osgoode Hall Law School.

Universal Music and Sony Music UK have both announced that they will soon deploy a new business strategy for downloaded music. The strategy (termed “on air, on sale”) will see new albums available for download the same day they debut on the radio. Previously, an album played on the radio a number of weeks before it was available for sale. Known as “setting up” an album, the practice intended to generate pre-release interest by consumers has instead been generating something else: piracy.

Today’s youth have grown up in a world where new technologies have increased efficiency in communications like never before, creating a culture of instant gratification. Consumers expect what they want, when they want it, and if the music industry doesn’t give it to them, they know how to obtain it for themselves. This has largely been the problem with the practice of setting up. Examination of Google search records showed that searches for new albums were peaking 2 weeks before the album was released. David Joseph (Chief Executive of Universal Music) believes that this shows that consumers were either bored of, or had already pirated the album before it launched. Universal and Sony hope that releasing the download on the same day as the radio launch will enable consumers looking for instant gratification to chose legal downloads over pirated music.

This is the latest in a series of attempts by the music industry to keep up with consumer expectations. In early 2009, Apple dropped Digital Rights Management Technologies (DRM) from its iTunes music store. That move came in the wake of a growing tide of discontent by consumers for the restrictions placed on them by DRM. At the time, there was concern in the industry that some potential customers were resorting to piracy in order to obtain DRM-free music. The move seemed to work, with digital sales growing to encompass an additional 12% of global music revenue in 2009. Today, digital sales of music account for 27% of global music sales (40% of total sales in the US).

Around the same time as Apple removed DRM, the music industry also abandoned their strategy of mass lawsuits in US courts, which many have criticised as having little effect on piracy. While the lawsuits succeeded in publicizing the issue and educating consumers about copyright infringement, they did not appear as effective a deterrent to music piracy as the industry may have hoped, with global music sales declining by around 30% since 2004. This shift in policy seems to indicate a growing trend in anti-piracy efforts: give the consumer what they want. The end goal of the music industry seems to be to get the need for instant gratification to work for them. By making it faster and easier to purchase music legally, consumers will be less likely to undergo the additional hassle (and liability) required to pirate music. In the end, incentivizing consumers to purchase music legally may prove to be a more effective strategy for combating piracy.