Saturday, January 17, 2009

Plan Now - The Consumer Clearly Wants Free Digital Content

According to a report by International Federation of the Phonographic Industry (IFPI), which represents 1,400 music companies in 72 countries, 95% of all today’s music downloads are illegal. This is despite the growth of legally available tracks, the removal of DRM and the wide availability of services to buy from.

Music fans in the UK downloaded 110 million single tracks in 2008 and bought 10.3 million digital albums - accounting for 7.7% of the market.

Although legal downloads have increased by some 25% in the last year to 1.4 billion the worldwide market has effectively shrunk by 7% and the gap between falling CD sales and increased downloads is not closing sufficient to avoid big questions over where its all going. The IFPI, estimated more than 40 billion music files were illegally shared in 2008.

Free content is now a real threat to all media. Music has shown that not engaging with the issue but trying to fight and restrict it in every way has not worked. Going after the ISPs is not the answer, it's just another potential battle and one that its hard to see the music producers winning.

We firmly believe that we should now accept the concept of 'music for free' at the point of consumption, is not a debate, but a goal and that this need to be paid for by another model. Merely battling forward on the belief that eventually it will turn the corner and consumers will return to buying music is just dumb!

What does this mean to other digital media formats, such as film, games, newsprint and books? It’s a fairly safe bet that the consumer will not view these very differently and although the restrictions may work today, they will be broken tomorrow. The Booktrade is still at the beginning of its digital journey but the sheer volume and diversity of its content and number of rights owners means that it probably faces the prospect of being divided in its approach and offer. Some would suggest that we have clearly already seen the warning signs.

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