Can't Kill P2P

There's this great, whiny song by Ozzy Osbourne from back in the day (before the TV show and all that crap) in which he screams, "You can't kill rock and roll -- it's here to staaaaaay!" Although remarkable for its cheesy sincerity, Ozzy's was just one of many songs expressing such sentiments back in the late 20th century. By then, it was pretty damn obvious rock couldn't be stopped, despite the efforts of Tipper Gore and the Christian evangelists. Yet clearly Ozzy still felt sort of threatened, or at least besieged enough that he needed to pen yet another paean to the juggernaut of rock, the world's most dangerous musical genre (later surpassed by rap).

I'm starting to feel like Ozzy. I want to yowl about peer-to-peer file-sharing software, a geeky topic I think Ozzy, with his reputation for biting the heads off bats, would appreciate. Like rock 'n' roll, P2P is not going to die -- despite hype storms to the contrary.

BigChampagne, a company that charts the usage of P2P networks, reported in June that 9.9 million people are using them simultaneously at any given time. That's a 20.1 percent jump from last year. And it's double the number from September 2003. The recent Supreme Court decision in MGM v. Grokster will leave some P2P companies open to lawsuits, and yet those companies are still holding their digital swap meets in which people trade files online. The Motion Picture Association of America and the Recording Industry Association of America brought several thousand lawsuits against individual file-sharers over the past year, but people are still flocking to BitTorrent, Kazaa, eMule, and all the other glorious free networks designed to facilitate quick information-sharing across the planet.

The entertainment industry, whose representatives have tiresomely insisted that their profits are being decimated by P2P, isn't really doing that badly after all. The film industry says DVD sales grew 33 percent in 2004. And in an extensive research report, the Economist has concluded that music sales grew by a few percentage points in 2004 too.

Now here's the really interesting thing. In a recent bulletin, the wackily named International Federation of the Phonographic Industry (an international version of the RIAA) said that "music fans downloaded well over 200 million tracks in 2004 in the US and Europe -- up from about 20 million in 2003." These were legally purchased tracks, by the way. So if we assume a comparable amount of growth in legal downloading this year, I think it's safe to say that buying shitloads of lame new music from major labels online will become as popular as P2P sharing. And indeed, the market for legal downloading is growing as fast as P2P: Internet industry analysts at Jupiter Research said earlier this month that the digital music industry is currently worth $350 million and is expected to double in the coming year.

Amusingly, $200 million of that revenue is from ringtones alone. Now what does that tell us? That people are so desperate to download music online that they'll buy anything -- even stupid ringtones -- if it's easily gotten in sufficient variety. Similarly, as soon as record companies made their music available online, via P2P networks or in stores like iTunes or Yahoo! Music, people started buying it like crazy. Maybe the popularity of P2P networks isn't about people wanting to "steal music," as the RIAA would like you to think. Maybe it's just about people not wanting to go to scabby old Tower Records for their music. Maybe it's just that people want to get their music online, and currently P2P is the best way to get it. Not because it's free, but because it's there.

Finally, some bigwigs in the music industry are starting to get it. Earlier this month Sony BMG announced it had made a deal with British ISP PlayLouder to make its entire music catalog available to the ISP's customers. That means anyone with a PlayLouder account can download any Sony BMG song, in any format, from any P2P network, perfectly legally, for free. Doesn't that sound civilized?

Imagine if anyone who had an Earthlink account could use BitTorrent for legal downloads of every Bruce Springsteen CD. What Sony BMG is acknowledging is that P2P is the new radio. People are using P2P to listen to music all day, discover new artists, and (yes) tape their favorite stuff to hear later. All these things will lead to bigger revenues for Sony BMG in the same way that radio play for their artists has in the past.

And yet, just last fall, a group of 47 state attorneys general wrote an open letter to the P2P industry urging it to "take direct and meaningful action" because mostly P2P networks are used for child pornography and crime. Here we are, almost 30 years after Ozzy's anthem shook my little ghetto blaster, and we're still being pummeled by lawmakers and hypocritical authority figures because of all the supposedly scary things wrought by youth music culture.

But I've got news for you. You can't kill P2P -- it's here to staaaaaay!


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