How The Digital Revolution Has Rised Music Piracy

Digital technological modernizations in music entertainment are commonly perceived to be fundamentally disturbing the authority or part of commercial actors inside the music business and their recognized trade practices and benefits. In particular, the internet is widely regarded as having produced a “crisis” for the music industry.

The opportunities created as a results of digital revolution of music as cited by Erik Brynjolfsson and Andrew McAfee shows how the digital revolution has hastening innovation, driving yield, and irreversibly converting employment and the economy of so many nations around the globe. The threats of digital revolution of music entertainment are critically analyzed by researchers and they deduced that digital music piracy is a discordant modern-day issue which remains to lead civic discussion on domestic rights, highlighting the extensive influence of the digital uprising on everyday music listening.

Consumers in the music market can receive music by following the industry’s traditional business model. For example, by ordering a CD, attending music festivals, album release parties or downloading an album to a business download store for example Amazon and iTunes. The consumer buys and does not have an active subscription afterwards. The growing popularity of streaming services for example Deezer, Spotify, and Apple Music shows proof that there is a paradigm shift in the music industry similar to other online business industries which increasingly relies on revenues from access services. Many firms for example Spotify and Deezer use both price and operate a two-tiered service that simultaneously that offers a free advertisement-based version and a fee-based version.

Music is a real phenomenon that consumers are always willing to spend on. Lal & Sarvary, states that “Some consumers need to sample music prior to purchase” On the other hand, it can be said that the greater convenience of sampling through streaming services will reinforce this relationship. This can make consumers more likely to buy music online and enjoy listening to their favorite artists. This argument indicates that the transmission can have a positive impact on music purchases. Several arguments have shown that transmission services for some consumers are more effective than traditional distribution channels. For example, they provide easy access to a complete music library and free consumers from music file storage compared to the cumbersome task of transferring them between devices. In addition, consumers can find and share music comfortably for example, through shared playlists and recommendation according to music preference. These features are free for advertising-financed services and if they provide enough utility for consumers, they may not see the need to buy music through a CD or downloading it.

While we anticipate the impact of free and paid music services, this negative impact will cause a great transmission of payment services, since the cost of these services competes with the cost of other channels for a limited budget for the service. In other words, consumers who pay monthly subscription for services may not be able to demonstrate continuous levels of spending on other channels. However, the adoption of transmission services may crumble other channels and this will strongly affect the paid transmission channels.

Statistics shows that the net effect of paid streaming on market receipts is positive, while the impact of free streaming is not. The implication of this finding recommends that music labels should focus on paid streaming and ensure that sufficient numbers of consumers choose paid streaming services through free streaming services. If companies succeed in attracting many consumers to the paid streaming model, they can expect the music market to grow as a result of the substantial revenue contribution from these services. Managers should focus on the business model of free streaming to inactive consumers or people with a very low level of expenditure for music. This implies that promotions for free streaming services should not occur when a consumer can expect to meet active music fanatics for example in music festivals or record stores. It should be the best place to attract subscribers for paid streaming. 

Despite the fact that streaming services such as Spotify, tidal and Apple music have reduced the rate of music piracy it is still prevalent across the world’s largest music markets. According to IFPI’s latest Music Consumer Insight Report, 38 percent of global consumers listen to music in copyright infringing ways. Unfortunately, usic piracy is still a norm despite the growing age of streaming.