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How bad has it actually been for the recording industry? Well, according to evidence offered in the short damages phase of the Limewire trial, the recording industry has lost more than $55 billion since Napster hit the scene. That was 1999, just ahead of a huge sales peak in 2001. And right in the middle of the gilded age of multi-platinum albums and multi-million-dollar salaries.
The rest is a complicated history, as we all know. "The evidence will demonstrate that there has been a $55 billion decline in record industry revenue over the last decade," the RIAA argued in a pre-trial brief. The calculation appears to end with 2009, suggesting a larger amount through the present period. "Even if Limewire caused only a fraction of this decline, Plaintiffs' damages would still be in the billions of dollars."
So, pin it all on Limewire? Sounds sort of ridiculous, though in recent testimony, Warner Music chairman Edgar Bronfman, Jr. said Limewire's impact has been "devastating," and its continuation after Grokster "frustrating".
But Limewire counsel Joseph Baio quickly explosed Bronfman for effectively pillaging the WMG castle. Since assuming stewardship of Warner Music in 2004, Bronfman alone scored $17 million in compensation while the company continued to lay off employees and cut overhead. It's that sort of cross-examination that may have ultimately persuaded the RIAA to settle.
pulled from court documents...
Comments Closed
@rustymk2 Friday, May 13, 2011
Rusty Redenbacher
:)
@Farradelica Friday, May 13, 2011
Mike Vavrek
explains a whole lot! That's why live music is my sole ambition! Nothing like touring! Selling records is hard!
@DMSdotFM Friday, May 13, 2011
dms.FM
Uh Oh
@mediajorge Friday, May 13, 2011
Jorge
So, who's spanking Fanning?
CTyankee Friday, May 13, 2011
Phew!
That LImewire settlement of $105 million came just in the nick of time.
Maxwellian Friday, May 13, 2011
Actually there's some good news everybody. This number will seem much lower by 2012, thanks to extreme hyper-inflation and currency devaulation.
Nice work Bronfman!
MisterSoftee Friday, May 13, 2011
can you name another industry that has lost so much so fast? I mean even saddlemakers probably had a better decline in the 20s.
Leonard Hatred Friday, May 13, 2011
Oh well, guess I shouldn'ta torrented so much.
thisismegivingafuck.jpg
Kimberlye Friday, May 13, 2011
Also could this billions of dollars loss be due to other social music media that is beginning to domintate the internet world? I' m just saying blaming one entity may not be the cause of money loss. I feel it is the emerge of online music media/marketing.
@plugola Friday, May 13, 2011
♫ Plugola
Whoa!
@Pjgarea Friday, May 13, 2011
Peter J. Garea
$55 billion in losses & they're still pointing fingers...
I always think to myself, what would it be like if the majors hadnt sued Shawn Fanning but instead one hired him?
We might have been tweeting about much different things if that were the case.
Yves Villeneuve Saturday, May 14, 2011
A much better way to measure music industry losses is to compare competing industries alongside true sales and lost sales due to piracy. Though I admit finding reliable data could be hard to come by unless there is actually some good data out there.
ANTI-EST.ORG Sunday, May 15, 2011
@_DannyVolt Sunday, May 15, 2011
Danilo Grbic
...they lost hundreds of billions by not adopting to the new model of distribution since 2000...
@theloganshow Sunday, May 15, 2011
Dave Logan
Meanwhile top execs continued to live high on the hog.
@emh2625 Sunday, May 15, 2011
E.Michael Harrington
Silly! Labels have lost $55 billion since Napster?!? And if I wasn't a professor/consultant I'd be a great Red Sox pitcher
musicservices4less Monday, May 16, 2011
Why is there always a focus on the major labels? There are hundreds if not more, independent labels that were going strong prior to the late 90's that are now struggling to survive (if not out of business) due to the unprecendented drop in volume due to free downloading over the last decade. Most if not all of the executives at those labels make "normal" salaries and are just trying to pay their mortgage.
What are we, chopped liver?
presnikoff Monday, May 16, 2011
Actually, the loss estimate is for the entire recording industry, though I think the title was a little misleading. The claims are being made by the majors (ie, RIAA), but certainly, indies have also suffered declines.
/pr
TDTMD Monday, May 16, 2011
Chopped liver-hardly but if you are working in entertainment then surely you know the value of a good headline..."One person killed as car hits tree" versus "Dozens killed and injured as Greyhound bus slides off the highway during Thanksgiving weekend trip to help starving orphans"..I wonder which headline would sell papers. All lives are important of course, but many lives lost in the same incident is news.
Okay, here is my treatise on the whole money losing aspect, both from a business and a social perspective.
Let's deal with the business side first. The latter day fortunes of the music industry, like other industries, saw its decline when bigger became better. When A&M was snapped up by Polygram, for the first time A&M staff had to answer to a shareholder. No longer would we be able to put FUN in the budget, FUN had to be allocated to a specific entry on a ledger and balancing expenditures with inflows on developing artists became more important than the music itself. A&m had prided itself on breaking acts (I would mention them here but I suspect most of the readers were either too young to remember them and perhaps too young to even remember A&M Records) so lets suffice it to say you saw one of the worlds best at the time, boutique labels become part of a larger universal (no pun intended) business whose managers had to answer to the money people for the very first time. Yes A&M was a major but it was still the largest independently owned record company, although Virgin was certainly making major steps towards seizing that throne. It was a label built by a recording artist in the truest sense of an indiie-they created the label to distribute Herb Alpert and the Tiajuana Brass and it grew from there. Still being big did not mean you could afford your own distribution and RCA handled A&M in America and to get records to the masses you needed access to the major rackjobbers and RCA provided that. After it was sold and had its own distribution network in America it continued to grow but at the espense of its legacy and I am saying this held true for other independents who were gobbled up in the corporate eating contest all industries went through in the 80's as the Yuppie me first mentality swept through the corporate world and everyone thought getting bigger meant being better. What it met was some great artists were overlooked as balancing the books and showing a profit meant more than developing acts and have them lose money as they built their careers where they became profitable. Corporate greed paid a part as managers of these corporations demanded to be paid according to the size of the ship they were steering and it became so bloody excessive and out of control it sickened me who was in the industry at the time. It was a me me me, or to quote the seagulls in Finding Nemo, "mine, mine, mine, mine, mine". The artists and thus the reason for being in the music industry began to take a back seat to the size of the wand, not the magic it bestowed.
As well you had increasing competition from the games industry (some young man full of insight actually left our company to join the gaming industry-duh, who was right?), personal handheld devices, and other technical dodads and whatchamacallizem and suddenly, music began to be less important in peoples lives, meaning that core group who sustained the business were now interested in other things. Sure music was still cool but it got to the point where albums contained singles, and some filler, as companies played to the lowest common denominator to fill sales forecasts that we created a singles industry instead of an album industry (that was the way it was before back before the LP took off in the 60's) but this time the consumer could get those singles or share those singles for free as the early MP3 devices began to come down in price and flood the market and it was as easy as borrowing your friends device and transferring all their music files to your device for free. I use the term files because I am a cynic and on numerous occasions at the local gym in the pool I would hear kids sitting around being cool talking about ripping, burning, and swapping music files to use the latest lingo of the day (we called them cuts and tracks, remember?). In short you had the perfect storm to kill the industry with reduced quality content, a singles market, an internet which afforded consumers with free choices, and a society who would never go back to the old system of buying whole albums as opposed to buying singles. How many times today do you see kids sitting down and putting on a whole album and just getting into it? I have two teenagers and I don't. It is a personal music device, played on shuffle. I don't often hear my stereo being used unless there is a party. Hell, when they have sleepovers they all bring their IPads or Laptops and they get on Facebook and don't even bother to talk to each other when they are in the same bloody room...the technology is ruling the day here. Social media indeed. It should be anti social media when they would rather connect with friends who are not at the sleepover rather than going to the basement, throw on some tunes and get into some musc and have some good laughs, play air guitar or just be googy dancing and listening to music in a social setting. Sadly it has lost its magic all the way around and getting that back, well, I have no answers except to continue to enjoy my music in my way.
Of course I know I am overlooking other apsects but this is beyond my ablility to put it all down in some coherent, convincing manner. I wrote my thesis on James Joyce, I don't want to do a second one on the music industry. The topic is far too sad. Pity the artist is all I say.
@KomusoTokugawa Monday, May 16, 2011
Komuso Tokugawa
Listen to my fingers playing the worlds smallst violin...
m.shamus Monday, May 16, 2011
Misleading headline: "Lost $55 billion" is different than "a $55 billion decline", which is what the evidence suggests. The music industry never lost this money, they just never earned what they expected they might if Napster never came on the scene.
That said, this argument by the RIAA is pretty ridiculous.
monayork Monday, May 16, 2011
..the horse and cart industry say they have lost $555 billion since the Ford motorcar..
Touché
Old people get over it.. It's called progress.
Lets all look forward and stop looking back..
And how is this even a headline? We are in 2011..
Ummmmm - that is all
@JVeart Monday, May 16, 2011
Jānis Vērzemnieks
Mūzikas leibli no impērijām kļūst par mazām kurpnieku darbnīcām
@Valleyarm Monday, May 16, 2011
Valleyarm
Majors say they have lost $55B since Napster. Here's to not talking about what actually caused these losses
@edmundmccormack Tuesday, May 17, 2011
Ed McCormack
Pretty insane.
@rigsc Thursday, May 19, 2011
Steve R
Time to work on that business model
@contrapuntist Thursday, May 19, 2011
Miguel Cano
lame thinking is the real problem.
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