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Summary:

Neil Young put a lot of the media industry’s hysteria about file-sharing into perspective when he said in a recent interview that “piracy is the new radio — that’s how music gets around.” In fact, a certain amount of “piracy” can be good for business.

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As an artist who probably makes a substantial income from licensing his music, you might think Neil Young would frown on piracy and file-sharing, but that appears not to be the case, according to an interview he gave at the Dive Into Media conference in Los Angeles. Instead of railing against file-sharers, Young called piracy “the new radio” because it’s “how music gets around.” The musician’s comment puts a lot of the hysteria about copyright infringement into perspective — as we’ve pointed out before, file-sharing and monetization aren’t mutually exclusive, and in many cases a certain amount of so-called “piracy” can actually be good for business, as authors, musicians and even game developers have come to realize.

Comparing piracy to radio is a smart way of looking at the issue: in the early days of the music business, when live performances and record sales were the main revenue generator for artists and publishers, radio itself was seen as a form of piracy (as sheet music was before that). Musicians fulminated about radio stations playing their music for free, and some record labels made their acts sign waivers saying they would not appear on the radio. In the end, of course, radio became a huge revenue driver for music — although it did so in part because record labels and publishers pushed for licensing fees.

Radio was seen as piracy too, but became a publicity engine

But more than just being a source of fees, radio was also a huge publicity engine for music, and eventually this became so obvious that at one point record labels were giving radio stations and disc jockeys “payola” under the table to promote their music. And now we have come full circle with Neil Young’s comment:

I look at the internet as the new radio. I look at the radio as gone. [...] Piracy is the new radio. That’s how music gets around.

This idea of piracy as being “how content gets around” doesn’t just apply to music either. In a videotaped comment last year about piracy, British author Neil Gaiman — who I interviewed recently about his opposition to the proposed federal anti-piracy bills SOPA and PIPA — said that he used to be irate about people pirating his work, but eventually came to realize that he was actually selling more copies of his physical books in those countries where piracy was the highest. Brazilian author Paulo Coelho found the same thing, and actually started uploading his own work to files-sharing sites without telling his publisher.

Some game developers — the digital-era equivalent of songwriters and authors, in many ways — have also come to see piracy as being a necessary evil, and in many cases a positive force. Markus Persson, the Swedish developer of the massively popular game Minecraft, has said that he came to see piracy of his game as a form of marketing. And at a recent music-industry conference in Europe, the CEO of superstar game company Rovio (creator of Angry Birds) said that piracy “may not be a bad thing” because it increases demand for the official version of the company’s products.

If you make it easy to get and pay for, piracy isn’t an issue

Even Microsoft CEO Bill Gates has been known to see the virtues of a little piracy, especially in developing markets like China. The Microsoft founder reportedly said of that market: “As long as they’re going to steal it, we want them to steal ours. They’ll get sort of addicted, and then we’ll somehow figure out how to collect sometime in the next decade.” Gates clearly saw pirating as a kind of loss leader, creating eventual market demand.

We’ve described before how one of the reasons why users engage in copyright infringement is that distributors make it too cumbersome to get the official version of whatever the content is, as venture capitalist Fred Wilson complained in a recent post, admitting that he pirated a livestream of a basketball game. But the example of comedian Louis CK — who allowed anyone to download his comedy special for just $5 with no copyright protection, and made over $1 million in less than a week — shows that there is still room for creators to monetize their content, if they make it as easy as possible.

As Andrew Weissman of Union Square Ventures noted in a recent post, information wants to be free — not necessarily free meaning it costs nothing, but free in the sense of being friction-free to access. And if you don’t make it easy for your music or writing or other content to “get around,” as Neil Young puts it, then piracy will take care of that for you.

Post and thumbnail photos courtesy of Wikimedia Commons and Flickr user Paul Sapiano

  1. Excellent perspective from a smart man and great artist; and darn good write-up, too, dude!

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    1. Thanks, Steve.

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  2. Zencamebronson Tuesday, January 31, 2012

    Neil Young should run for President.

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    1. Uh, he was born in Canada.

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      1. You don’t have to be born in America, just become a citizen and you can be President.

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  3. This has been going on for 100 Years now…and it seems will never end…

    From wikipedia:
    Keppard’s band became the Original Creole Orchestra which toured the Vaudeville circuit, giving other parts of the USA a first taste of the music that was not yet known as “jazz”.[1] While playing a successful engagement in New York City in 1915 the band was offered a chance to record for the Victor Talking Machine Company. In retrospect this would probably have been the first jazz recording. A story says that Keppard didn’t want to record because then everyone else could “steal his stuff.”

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  4. it’s time to stop pretending that the existing industry has anything to add to the world.

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    1. Neil Young is right on spot. And here is some advice from the other end of the spectrum, from a music lover who doesnt have access to his favourite music: Music companies, if you can give me the music I want, dont expect me to pay for it! You would assume that living here in India with all the outsourcing and exposure to western culture and Hollywood, I would get access to the best of western music? Nope. Music companies decide what I should buy. You will have to search high and low for Armin Van Buuren’s State of Trance CDs. Only Tiesto and Paul Van Dyk are available becuase a local publisher has a tieup. And if I do want to get the best of trance numbers legally, wait till the end of the year for a double CD compilation from which you will only like 2-3 numbers. Forget more esoteric music: Local publishers would have you beleive that Reggae is dead. African music does not exist.

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  5. Rohan Jayasekera Tuesday, January 31, 2012

    So: Everything is freemium, sometimes unintentionally.

    When free=pirated, benefits of premium typically include a clear conscience and the avoidance of any possible retribution. If the benefits are not perceived to be all that valuable, then the premium price must be set low.

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  6. Hey neil – your album Trans was 28 years ahead of its time. Yet I can’t get a copy… Are you suggesting I pirate it? :)

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  7. “As an artist who probably makes a substantial income from licensing his music, you might think Neil Young would frown on piracy and file-sharing”

    No, I don’t know why anyone would think this. He’s an extremely popular and well-known musician — inducted into the Rock and Roll Hall of Fame twice. The most commercially successful musicians tend to be the most amenable to casual copying, since they don’t need to make any more money. He’s not going to starve or have to pick up a day job, even if nobody buys another Neil Young album ever.

    Interestingly, you don’t say if Neil was for or against radio, back before he got popular, and back before file sharing existed. You do say that “radio became a huge revenue driver for music — although it did so in part because record labels and publishers pushed for licensing fees”.

    I’m sure up-and-coming bands would be completely in favor of “piracy” if they had a record label who paid them for it.

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    1. I’m in an “up-and-coming band” and we actually strongly approve of our music being on file-sharing sites. We also make all our music available on a “pay what you think it’s worth” policy.

      I’ve seen/heard a number of people say things like “it’s all very well for wealthy musicians to say it’s ok, but spare a thought for the bands who are struggling to make ends meet.”

      However, although it is true that we don’t make a living from our music (yet – we are still in debt after making our album), what’s the worst that can happen as a result of our music being pirated? Millions of new fans listening to our music for free. That I wouldn’t mind at all.

      Of these (theoretical) millions of new fans, some would then decide to pay for our music, some would decide to pay to see us live, some would decide to buy a t-shirt etc. And this isn’t a radical, bold business strategy by any means. It’s exactly what radio did for artists in the 20th century.

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  8. Wow, it’s true. The debate really is five years behind in the US. Amazing. (I’m from sweden)

    (Except i guess, @Jayasekera: interesting point, sir)

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  9. Right on !!! Neil ! I have to say I am happy to agree with you … :-) player pianos were illegal … Now it’s gnutella networks …

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  10. I agree with you strongly with regard to the effect of friction and piracy. Many people watch consume pirate television because of the effect of transmission rights barriers across territories and long delays in selling shows abroad. Three years and United States of Tara has still not been picked up by UK television! What’s a fan to do? Also, where purchase and consumption is very easy within the ecosystem, particularly Itunes, the convenience trumps the free-ness. Media businesses have long calculated their ‘losses’ based on an estimate of the number of distributed pirate copies of a work, but the reality is that most of the pirate owners would have never paid for the work they picked up for free, so the loss is illusory. Sampling one work might just get them to buy some of the artist’s ouevre. I am against piracy in principle but it does have compensatory marketing advantages to be exploited.

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