The experience of the music industry, which has been plagued by digital theft, should send shivers down the spines of film executives. The music majors are suffering from declining sales and the inability to protect revenues from digital theft.
The music majors have been hard hit by piracy, at a time when they were already struggling with declining sales. Global music sales fell by 7% last year, the third consecutive decline. A further 5% decline is predicted this year.
The proliferation of digital music in the form of the recordable CDs, various internet sites and most notably peer-to-peer technology (P2P), has made downloading and ‘burning’ illegal copyrighted music often easier than obtaining it legally.
The music industry is faced with a situation where it cannot protect its main revenue stream, because as soon as content is released, it can be illegally copied, distributed and downloaded around the world in a few hours. In fact, the new Radiohead album Hail to the Thief was copied and distributed online before official release.
While the declining status of the music industry cannot be singularly attributed to digital theft, it is clear that online piracy has delivered a significant blow to revenues. Film executives must ensure they don’t fall to the same fate.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
