The following paper discusses the phenomenon of music piracy and its impact on the current state of the music industry. First, it presents the background information that covers the process of music piracy development and popularization making emphasis on such its result as music sales decrease. Further, the paper analyses the impact of music piracy on the music industry, namely the opportunities and threats it provides for musicians and music labels. In this context, the paper also discusses the appearance of such a phenomenon in the music industry as streaming. The next section of the work is dedicated to the discussion of factors that motivate people to use pirate websites, namely the problem of targeted customers, benefits music piracy brings them, and moral limitations that may help to uproot such phenomenon as music piracy in the world. The paper presents a detailed theoretical overview of academic sources in which the central problem of the essay is discussed. Keywords: music piracy, music industry, music streaming.

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For many centuries, the only opportunity for people to listen to music was to attend live performances. However, scientific revolution that took place at the beginning of the twentieth century provided them with a unique chance to record the sound and, consequently, to reproduce their favorite melodies with the help of special devices. The era of gramophone records, cassettes, and discs contributed not only to the popularity of many musicians but also to the wealth of the latter. From every record of their song or melody, they received a part of the money their devoted fans spent on their albums. However, the introduction and popularization of the Internet led the music industry to a real crisis. After music started being recorded in a digital format, there appeared a happy ground for a new type of speculations – music piracy. Computer-literate music enthusiasts bought official albums and streamed music online making it available for everyone for free. While just a few decades ago, this tendency was gaining stream, the increase in music piracy that can be observed now results in a significant decrease in music sales that impacts both the industry and the customer’s attitudes towards it.

The popularization of music privacy has caused a public uproar among musicians and people connected with the music industry and numerous discussions among business strategists. On the one hand, initially, music piracy played in the hand of artists. Once their song appeared online, it could become popular in a few instants that contributed to the popularity of singers and bands. This opportunity was especially important for beginners who were at the start of their artistic journey and were unknown in the world of music. It was clear that no one wanted to spend money on the disc of some unpopular band having heard only one or two of their songs. With the help of the Internet, however, ordinary people could listen to almost all songs for free and decide whether a particular band was worth becoming popular. If so, the musicians received many devoted fans who attended their concerts. As for famous musicians, they also used music piracy as a tool of promotion of their works that led to the growth of their popularity.

However, there is also a reverse side of the medal, and music piracy is not an exception. According to M. Appleyard (2015), “in the United States, this led to a 53% decline in legitimate music sales between 1999 (over US $14 billion) and 2013 (US $7 billion)” (p. 70). People simply stopped buying disks seeing no need in spending money and time on something they could get for free without even leaving their homes. The main reason for it was that “consumers are unwilling to purchase legal items if they are inferior to illegal alternatives” (Appleyard, 2015, p. 72). Consequently, the income of musicians and music labels decreased that led to the crisis in this business. Therefore, in many countries, anti-piracy companies were initiated. For instance, A. Adermon and C. Liang (2014) claim that in Sweden, after the implementation of copyright protection reform, Internet traffic decreased by 16% and music sales increased by 36% during the first six months (p. 90). However, many people still view the anti-piracy strategy to be “a cat-and-mouse game” (Appleyard, 2015, p. 73) that will bring no benefit to both musicians and customers. Moreover, there is an opinion that the crisis has already passed, just after such streaming services as iTunes were presented. For instance, B. Koh, B. Murthi, & S. Raghunathan, S. (2014) state that “2003 was an important year for the music market because of a disruptive change introduced that year in the form of iTunes and similar online channels” (p. 367). These services provide consumers with a chance to buy individual tracks legally in a digital format. This idea is also supported by K. Borja and S. Dieringer (2016) who emphasize that already “in 2014, global digital revenues were driven by 32% growth in ad-supported and subscription streaming services, with 41 million people paying for the service compared to only 8 million in 2010” (p. 86). The primary motivating factor for customers to buy music is the quality of records. Those they may download from the pirate websites, usually contain some advertisements and, generally, are of low quality. In addition, the manufacturers of many modern devices make their smartphones and laptops unable to reproduce music from unreliable websites. As a result, the owners of such devices are forced to buy music. However, there is still an opinion that streaming will not be able to fight music piracy completely and both of them will continue existing simultaneously for many years.

While the central motivation of musicians to fight music piracy is gaining money, the motivation of the customers downloading music without paying for it is saving their earnings. Every musician, when creating and presenting their music, realize the target audience of their legacy. If the audience that listens to the works of some opera singers is usually mature and wealthy enough to buy the album of their idol, pop singers normally create their songs for teenagers or young people whose income level is too low to spend money on music. Moreover, as Appleyard (2015) claims, “consumers often view large firms as exploitative, and robust legal actions can exacerbate perceptions of David-and-Goliath scenarios” (p. 75). Therefore, they consider it to be just that they, having little money, do not pay to those who earn millions of dollars for each album. Still, streaming services have changed their attitudes towards music piracy. They allowed people both to listen to their favourite music and to find new ones for a rather modest price. Another factor making people stop using pirate websites is their moral limitations. For a long time, nobody spoke of copyright protection, and the music was viewed as something public but not a part of someone’s work. Now, step by step, people learn to respect other people’s jobs and opt for streaming services but not music piracy. Still, there is a long way ahead to the moment this phenomenon stops existing.

All the things considered, music piracy has become one of the biggest threats of the modern music industry. Though at the beginning of its development, it was viewed as a useful platform for the popularization of already famous musicians and the introduction of budding stars to the general public, soon, it led musicians and music labels to a severe financial crisis since physical music sales decreased significantly in comparison to the pre-Internet era. The situation changed in 2013, when the streaming services, such as iTunes, appeared. With their help, people gained unlimited access to most music tracks, and it costs much cheaper than to buy all albums of their favourite musicians. As for the reasons that make people use pirate websites is the fact that they make music free and, therefore, more accessible, and the lack of moral limitations in the society that concern copyright and intellectual property. At the present stage, the latter are widely discussed in the community that motivates more people to buy music but not steal it. Hopefully, in the nearest future, it will lead to the end of music piracy.

  • Adermon, A., & Liang, C. (2014). Piracy and music sales: The effects of an anti-piracy law. Journal of Economic Behaviour & Organization, 105, 90-106.
  • Appleyard, M. (2015). Corporate responses to online music piracy: Strategic lessons for the challenge of addictive manufacturing. Business Horizons, 58, 69-76.
  • Borja, K., & Dieringer, S. (2016). Streaming or stealing? The complementary features between music streaming and music piracy. Journal of Retailing and Consumer Services, 32, 86-95.
  • Koh, B., Murthi, B., & Raghunathan, S. (2014). Shifting demand: Online music piracy, physical music sales, and digital music sales. Journal of Organizational Computing and Electronic Commerce, 24(4), 366-387.