The Recorded Music Industry and the Emergence of Online Music Distribution: Innovation in the Absence of Copyright (Reform)

Abstract

The fact that various online music distribution (OMD) models have been the source of significant consternation for the recorded music industry (RMI) is well-documented. The hostile aspects of OMD-RMI interaction have driven public debate, academic research and years of copyright policymaking - not to be mistaken for lawmaking. In particular, the story of the RMI struggle to acquire maximum control over networks, content, and users has been told. This narrative often takes on a negative tone regardless of the perspective from which the story is recounted. Unfortunately, a one-sided depiction does not fully reflect the complex dynamic of OMD-RMI interaction.

In order to understand how the RMI and OMD may be better synced so as to enhance social welfare, this article tracks the development of various OMD models. Section I begins by introducing a rough technological taxonomy of OMD. Once this taxonomical framework has been created, Section II evaluates the introduction and establishment of OMD models within the context of the traditional RMI environment. Section III continues along this path by analyzing OMD innovation within the new OMD-influenced RMI ecosystem. In both Sections II and III, particular emphasis is placed on identifying points of friction and collaboration at the relevant levels of innovation, creation, use, industry and institutions. Section IV attempts a brief analysis of the dynamic interplay between innovation and competition within and amid OMD models and the resulting impact of these forces on access to creative works.

It is argued that comprehending the evolutionary and dynamic nature of the OMD-RMI relationship helps in determining the proper type and appropriate scope of any future policies concerning OMD.

Keywords: P2P, File-sharing, Digital Distribution, Copyright Reform, Music Industry, iTunes, Streaming, ISP