How Google Killed the Music Industry (In 3 Easy Diagrams)

Google Killed the Music Industry, Right?
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Diagram #1.

If your business is based on recorded music sales, then you know this slide well.  But it’s also created a ripple effect throughout the music industry, with artists and labels moving towards touring, merchandise, and other areas to sustain revenues (with mixed results).

Diagram #2.

Under the Digital Millennium Copyright Act (DMCA), signed into law in the 90s, sites like Google are only required to remove infringing content when notified by the content owner.  Content owners, which include major recording labels like Warner Music Group and Universal Music Group, complain that no matter how many notifications they send, the same links (from the same sites) keep appearing over and over again.  And despite a massive surge in notifications over the past few years (see above), the amount of pirated content remains large.

Diagram #3.

Any questions?

40 Responses

  1. Daniel

    Basically, this is the end of my reading this publication. Your premise is a vast oversimplification. Unfairly characterizes the shift from ownnership to access that corresponds with the internet age as a product of google’s supposed greed, and worst of all does nothing to further the dialogue among industry professionals about the causes and effects of the internet of what was a vastly bloated market in the late 90’s. In short, cheap headline. Zero content. Over it.

    • Gnome Sane

      This article is perfect for those who think:
      a) torrent downloaders would actually purchase .0001% of the stuff they download if prevented from downloading
      b) Google is a useful way to find accesible pirated music for free
      Please extract head from rectum

    • Remi Swierczek

      Dear Daniel,
      I agree it is oversimplified …but Google is the main entity keeping music in the open. Music as the most popular media is also the most desirble property to swarm with ads!

      Google the biggest Shazam makes Shazam, Soundhound or Gracenote worthless!

      Entities with over 500 million (not counting the DIGITAL MONK #!) users continue to function as PIMPS of music.
      Deep pocket PIMP ONE has set the standard at no money for PIMPING service and NO MONEY for SEX! As long as they controll the condom supply everyone but screwed musicians are happy!

  2. Anonymous

    So it wasn’t napster and the pirate bay? Cool.

  3. so

    Top 4 auto-complete searches for a record in Google are often “rar”, “zip”, “leak”, “free”, “download” (and I doubt they mean iTunes or BandCamp).

  4. Sid Luscious

    Correlation does not imply causation.

  5. rikki

    musicians killed the business due to the cheap shoddy McMusic being produced in mass quantities….. so why pay for it….you dont care enough to learn to sing or play an instrument, on key.

    Do something radical no auto tune, and learn how to play a danceable guitar solo.

    make me want to pay to see you live and buy your music……….

    Enough of the mediocrity!

    • Tootology

      The fans killed it when they stopped paying. Pretty simple really.

    • Fight from the inside

      And you’ll pay dearly for that ticket. You don’t get something for nothing.

      • rikki

        money I HAVE talent is lacking in today’s moosisianzz

        paul simon wrote sounds of silence when he was what 22? bob dylan like a rolling stone he was how old? 24…..

    • matthew king kaufman

      RIGHT ON!!
      music is the product

    • Faza (TCM)

      O RLY?

      “Spurious correlations” occur when we see a relationship between data points without a clear causal mechanism.

      In this case the causal mechanisms are clear cut and nobody really denies them.

      1. Substitution is an Econ 101 concept. In the case of licensed and unlicensed copies of creative works the unlicensed copy is a pretty much a perfect substitute.

      2. The difference between getting something at a zero and a non-zero price needs no further discussion.

      3. Locating the free option carries a cost. Google is doing its utmost to bring this cost down, often ranking the pirate options higher than the paid ones.

      4. Google is quite clearly the dominant search provider.

      So, what was that about “spurious”?

  6. Blatanville

    So, major multi-national corporations buying up the record companies in the 80s and 90s, and demanding the same kind of margins they were squeezing out off their widget industries, neglecting the fact that even as a business, record companies and movie studios were in the business of ART…
    That had nothing to do with it, huh?
    “$18.98 Iggy Pop CD/ wonder if I can get it from my sister for free/ it’s all about marketing, Clive Davis, see? When people buy the shirt then they get the MP3.”
    MC Lars, “Download this Song”

  7. Nick White

    Holy cow! Are you guys secret apologists for the RIAA? All you do is whine about Google, YouTube, and Spotify – same as the RIAA! The blame game is still being played. As a result, nothing is getting done. You are losing your credibility as a “news” source. Later!

    • dancer

      +1 for digitalmusicnews losing its credibility

  8. Anonymous

    “Any questions?”

    Nope, that just about covers it.

  9. jose cláudio

    Hi, I worked for Warner Music Brazil and I resigned in 1998, as my friends abroad told me the industry would sink in 2 or 3 years (2000/2001).
    In Brazil there is no law against piracy. In all streets you can buy copied CD/DVD for less than 1 USD$!

    José Cláudio

  10. Jose Fritz

    Pure propaganda. You start the Revenue Chart in 2001.. after the historical peak of CD sales. So of course it’s trending down. If you started in say 1973.. sales would just appear to have returned to “normal.”

    • Faza (TCM)

      And if it falls down to zero, you can say it has simply returned to the “normal” state before we had a recorded industry.

      Do try to make sense.

  11. Ariel

    The problem is digitality itself: easy, free copying and distrubtion that replaces what used to be the central function of publishers. Copyright law used to set limits, in practice, only on owners and operators of heavy capital equipment like record presses and trucks. Today it sets limits on everyone and those limits to many including myself, seem extreme and arbitrary (emailing your friend an mp3 is illegal, say).

    The DMCA isn’t perfect, but it at least addresses reality. The record industry has been utterly, utterly unhelpful in coming up with a new scheme. They’re all about recreating pre-internet scarcity and moralizing at / suing people who disagree. (Also pop music is mosty dogshit, but that’s probably seperate).

    • Me2

      In keeping with your analogy the presses have been replaced by internet platform code, and the companies that deploy it. That is where we should be looking, as many are, to set the limits.

      • Ariel

        That’s a broken analogy though. Youtube is a peer-to-peer platform. You’re talking about Youtube putting limits on its users.

        • Me2

          Talking about YouTube putting limits on its service.

          As far as I know, YouTube houses all of the videos on their servers, without using p2p file transfers. I think the term you’re looking for is ‘User Generated Content’.

          But how merely uploading an album, movie, someone else’s video etc. legally qualifies as ‘User Generated Content’ is something I’ve been thinking on lately.

          • Ariel Stulberg

            You’re right. That’s the term.

            So, I basically agree Youtube is abusing DMCA, but I don’t think the kind of alternative Paul is suggesting exists. I think music recordings are, as a practical matter, free-to-all the moment the hit the internet. You can ask people to pay. Everyone who can afford to pay should pay. But you can’t force them anymore. The free alternative is just there. It’s a string of information that’s extremely easy to share. You can whack all the moles you want, but it seems to me sharing/piracy/free stuff is just in the DNA of internet technology and can’t be eradicated without really deep controls over the entire global computer network.

            And that’s good! It’s amazingly good that so much stuff is available to so many people. It’s a massive human achievement.

            The problem of keeping the arts afloat financially is a big problem and always has been. I think there are better solutions than trying to recreate scarcity.

          • Me2

            I agree and think it’s great how much material is available, as well as the relative ease of distribution. The whole history of recorded music on demand, more or less. This was the dream back in the 90’s, right after the advent of mp3.

            Now that dream (at least one part of it) has become reality.

            But most just did not foresee that it would result in such little remuneration for the enjoyment of recorded music (if at all). We should have forseen. But we just thought the internet was… somehow special.

            It isn’t really anyone’s prerogative or necessity to assert global control over the web. The banks do just fine (generally speaking) without it. Accounts for the most part have remained secure, and not devalued despite their digital embodiment. This is in no small part happens because of security and legal enforcement but also because of the social conditions. I wouldn’t write code that hacked the bank accounts and copied them over to me, because.. that’s stealing.

            Come to think of it, I wouldn’t retool stuxnet to take down a hospital either (not that i have such skill), because that’s just killing.

            So much for code=speech.

            Something will likely take the place of the current paradigm, probably sooner that we realize in fast pace of cyber-time.

            My hope would be for something more decentralized and transaction based. The pieces are already there with micropayments and blockchain. We just need that digital mozart and the right conditions to make it happen. It would within a year obsolesce anything we’ve seen from YouTube or the streaming companies to date, for sure.

            Mind you, from my perspective, the current internet monopolies are actually trying to slow things down in this arena, while keeping the real goodies until the time is the most profitable.

            All this despite the rhetoric of “revolutionizing” everything. They’re actually standing in the way of what comes next (though they want to be the ones to do that too, when it suits them).

            My fear is that the next moves we’re actually looking at, back here on earth, at least in the short term are not systemic or revolutionary in nature, but more like a regulatory melee.

            We’re already seeing enough spin, ‘educational’ influence and lobbying to make Standard Oil and Big Tobacco look like amateurs (we are talking about the largest multinationals in the world right now).

            But I got off topic. Of course, given the current (1990’s) legislation loopholes, DCMA included, YouTube/Google did the only thing it could,.. eat everything.

            I have to wonder, over the years, how many millions are spent and how many millions more to promote ‘free culture’?

          • Me2

            Oh good god, I wish this site has editing.

            Edit above DCMA to DMCA, the internet totally missed that last coding joke.


    Given the dead bird over the headline I assume taste is at least as dead as the music biz. Crass, Paul, and completely unnecessary.

  13. Maxim

    So, basically, the diagrams show that the more requests Google receives for takedowns, the less revenue the music industry gets. Which means that Universal, Warner and Sony should simply stop sending takedown notices (which apparently cause that huge decline in revenues) and the revenue will get back to $14B or whatever it was.

    PS Digital Music News sometimes come up with such ridiculous articles, numbers and correlations so I start wondering whether the people behind this web-site have to do anything with the music industry at all…

  14. Raptureman

    Sorry but no. Sales are painful for some, but music is alive and well. Artists may have day jobs, live frugal lives, but its there. A huge network of people around the planet, new scenes, nostalgic get togethers, live & archived. The internet has basically become a fluid that music – production and consumption – has dissolved into. If you want platinum albums, pitchshifted pap, soft drink sponsorships, glossy videos and the same sounds that your whole street/school/office has got, then yes, dark times for you Ringo. For me, its the future now.

    • thismachinekillsfascistswhethertheyrealizeitornot

      So it’s ok that musicians lead “frugal” lives ie. are broke. It’s fine that their only option is to stopgap with the kind of employment that will enable them to take the time off (ie. usually low-wage employment) so that they can come and play for their “huge network”. This adds up to you?

      And if they do manage to succeed somehow beyond their “frugal” existence, then it must be “platinum albums and pitch shifted crap”. One or the other, no middle class here. It’s either the 1% or totally unsustainable. Is that what you’re saying is “there”? Because it sure reads that way.

      Sad. The only thing “fluid” about your arguments is the ground they stand on.

      Great job conflating live performances with recorded music (not that the headline didn’t already do that). And thanks for supporting the corporate dream of mass inequity. Nicely done.

      Next, why don’t you tell us about how “production costs are zero”?

  15. Hugh

    the article assumes that the number of takedown requests is a factor of the amount of pirated material. Whereas alternatively one might assume that as the number of takedown requests go up, the amount of piracy would go down. At best it’s an assumptive bit of reasoning and difficult to follow. Interesting but doesn’t make too much sense.

    • Me2

      It would be interesting to see this plotted against number of users and/or number of video uploads. Perhaps that is the connecting factor.

  16. Rick Shaw

    Now show the graphs that prove how the music industry committed suicide by eliminating artist development and releasing music based upon numbers

  17. A. Lewis II

    The music industry brought this upon themselves. I still remember having to pay MORE for a music CD than for a DVD movie in the mid-late 1990s. With the movie, you get your money’s worth, but for a crappy music CD, you’d be lucky if two songs were worthy of listening to.

    The industry was greedy and Napster did them in, not Google.

    I have no sympathy for these huge music companies. This is the penalty for getting greedy.

  18. sauseagent

    Yeah I have a question…How many Artists that have demanded (from google) their new album be taken down simultaneously complained nobody got to hear their new album? There’s a graph for ya
    since you so brilliantly ended with ” any questions”

  19. Dan

    This is the worst article I’ve read in a very long time. If you’re tasked with writing an article about something, maybe actually write about that thing instead of smugly presenting three graphs with a moderate correlation and asking “any questions?”.