The Digital Music Market - Educating Users

• Author: Sylvie Castonguay
• Position: WIPO Magazine editorial team, Communications and Public Outreach Division

The Digital Music Report 2008 compiled by IFPI, which represents the recording industry worldwide, estimates that worldwide earnings for the record industry in digital music sales topped US$2.9 billion in 2007 - a 40 percent increase over 2006. Not bad considering that the industry was non-existent in the digital market five years ago. But will the double-digit growth in digital sales counter industry losses on physical CD sales, falling since their US$45 billion peak in 1997? Not by a long shot, if the Enders Analysis forecast in its March 2007 "Recorded Music and Music Publishing" report proves correct.

IFPI identifies rampant illegal downloading and peer-to-peer (P2P) file sharing as the number one reason why digital sales have not made up for the slow down in CD sales. It calls for Internet Service Providers (ISPs) to act by suspending and disconnecting the accounts of copyright infringers and by applying filtering measures, noting that tens of billions of illegal files were swapped in 2007 - a ratio of twenty unlicensed downloads to each legal one. IFPI suggests that new revenue sharing models with ISPs may provide the incentive for them to act against piracy. Legal action against ISPs may also further encourage cooperation with the music industry. (See also, In the Courts: Pursuing the P2P Pirates in this issue of the WIPO Magazine.)

The music industry is also looking to remedy the situation by reaching out to the users. The pro-music.org site was launched three years ago with the endorsement of the music industry worldwide - from musicians and managers to major record labels, retailers, performers and publishers - to educate the public on the legal download of music. The site links to resources for educating parents so that they can in turn teach their children to use the Internet responsibly (see box).

This approach is in line with the findings of the Microsoft Survey of Teen Attitudes on Illegal Downloading, conducted in January. The survey showed that their parents were the first source of information for teenagers on the rules related to downloading. Moreover, the survey found that the more teenagers know about copyright, the better they understood that illegal downloading is a punishable offense. However, the older the teenagers, the less likely that knowing the rules would change their downloading habits. The findings of the survey suggest that outreach efforts...