UK band makes money because of piracy

By August 28, 2008 12 Comments

I seem to writing a lot about music and ‘free as a business model’ at the moment, and a great post on Techdirt this morning has me at it again. This is such a great description of why bands can benefit from having their music freely available that I’m going to reproduce the whole thing:

At some point, it won’t make sense to post these sorts of examples any more because it will just be common sense that bands can and do benefit from so-called “piracy,” but every time we post one of these stories, we get people complaining that this couldn’t possibly work for others. When a band is big, then it will never work for small artists. When they’re small, it’ll never work for big artists. Once we even had a commenter complain that it might work for big artists or small artists — but it was the all important artists in the middle that it would never work for.

So, here we go again, with yet another example of a band that isn’t worried about piracy. It’s an award-winning acoustic folk duo out of the UK, called Show of Hands, where one of the members admits that one of the most popular ways that people find out about the band is when others share the band’s music, and this often drives them to come out to shows and buy CDs as well. The band points out that “piracy” is a bad description of what happens:

You may call this process ‘piracy’ if you wish – for me it is an act of generosity and it both increases our audience size and record sales. And as I always say on the night – if you’re going to do it anyway you may as well feel good about it! I believe the official term is ‘viral marketing’, and we depend utterly upon it.

Yet, if he listened to the RIAA or the IFPI, apparently, all this viral marketing that the band depends on would be “no different than common theft.”

If the bands don’t need to be making money from digital sales then it is unclear that anybody else needs to be. Which leads to the conclusion that the price of music online needs to be low enough that consumers decide that it simply isn’t worth the hassle of going to download pirate sites. That could be via subscription
services or via ad supported services.

This is more evidence that labels need to reduce their royalty demands. As I’ve said before labels’ expectations are shaped by the economics of a by-gone age, and clinging on to them is a perilous endeavour.