Free Downloading Eating Net Music

The European record industry must act now to curb the illegal free downloading of music and license their content to paid-for online music services. These are the main conclusions from new Net music industry research from Jupiter MMXI.

This latest study shows how the legal music-downloading sites (such as MP3.com, Peoplesound.com and Vitaminic.com) are suffering as the usage of grey market, peer-to-peer applications (such as KaZaA, MusicCity Morpheus and Audiogalaxy) are increasing.

Jupiter believes that the music industry's attempts to regain control of this market through the courts, as seen with Napster, have not only failed to check the growth of file sharing but have also proved unpopular with consumers. In addition to tackling piracy, the record industry needs to offer compelling alternative options to the grey market that are worth paying for.

However, as Mark Mulligan, author of the report, points out 'Paid services will remain niche until they have comprehensive content and grey market alternatives become less appealing for consumers.'

Jupiter suggests that the record industry is therefore faced with a dilemma. It doesn't want to alienate future customers by targeting individuals to close down peer-to-peer networks. Jupiter's own fieldwork points to the fact that over half (52%) of peer-to-peer users are under 25 years of age. Although they are not representative of the older, higher-spending consumers that are key to the record industry, they are the new generation of music buyers and are currently more likely to use download services online than buy entire albums in music stores.

However, the record industry also needs to put a stop to the increasing number of illegal music files being transferred over the Internet, and encourage people to pay for downloading their music. The challenge is to offer superior services, for instance better quality sound, virus-free files, exclusives with artists and increased security compared to those that are available free.

Mulligan concluded, 'Europe's legitimate online music market is being left in the starting blocks by the unchecked growth of illegal file sharing. The record industry needs to crack down hard and fast on the software companies behind file sharing networks and at the same time get serious about licensing content so that legitimate services can offer compelling alternatives. If they fail to do this, the free music mindset will become permanently embedded in the new generation of music listeners and paid-for music services in Europe will never get off the ground.'

All articles 2006-22 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.