Music industry still fails to understand the Internet

Most people who download music from the Internet do it illegally. According to a new industry-backed survey 95% of all music downloaded from the Internet is from “pirate” sites.

This morning on BBC Radio Five Live, a UK industry spokesman came out with the same, old, tired arguments that if we don’t pay for music the industry will die.

Actually, the music industry will die because it is currently inhabited by this dinosaur style thinking. The world has changed and all the music industry has done is to make its products available by another “channel”, such as iTunes.

What the industry has failed to realise is this simple fact – people now expect music to be free. That’s a fact the industry simply has to get to grips with.

It’s also a fact the rest of business has to understand. Things that people used to pay for they now expect free. For instance, in the past if you wanted information in any kind of depth you either had to visit the local library, or you had to pay a researcher. Few business people had time to visit libraries, so information research was a significant industry. Now, we all get the information we want without paying for it – we use the free services of Google, Yahoo and the like.

Just a few years ago, if we wanted anything really special we would have paid $97 or more for a downloadable report. Now, we download information for free.

Only this week I’ve been rebuilding this web site (not yet live…!) with free software (Joomla) which I have needed several “extensions” for. They’ve all been provided by developers (some big companies too) free of charge. Just a few years ago I would have paid hundreds of pounds for these items – not any more. We expect it all free.

Even Microsoft is realising the issue. They made their billions by selling is digital material in huge boxes with big books inside them, which we never read. Now we can get Office software suites and operating systems for free.

Everywhere you look, businesses that used to charge for things are finding they can’t do so any more. Industries like the music sector simply have to face up to the changed world where their customers expect their products for free. They need to talk to those pirate web site owners; they are making money even though their core “product” is supplied free of charge. The people who make free office suites are still making money and the Joomla project is also well funded – even though its product costs zero.

The future of business looks very different with core products and services being provided online for nothing with money being made in very different ways. And I’m not the only person who thinks this – take a look at what the influential Chris Anderson has said in this article.

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