39 Pages Posted: 6 Jun 2012 Last revised: 22 Oct 2014
Date Written: Feburary 17, 2012
The transfer of copyrighted music for free through peer-to-peer sharing programs such as Lime Wire has been a major issue in the music industry for almost a decade, but how different would the music industry be if peer-to-peer sharing was not considered copyright infringement? What affect would allowing peer-to-peer sharing have on the music industry, the artists, the record labels, and the general public? After looking into what the world would be like if downloading music through peer-to-peer file sharing programs was not considered copyright infringement, it seems there are strong arguments that it shouldn’t be.
When considering the effect of the free distribution of music, the first stop undoubtedly has to be the Grateful Dead. At their peak, the Grateful Dead had two million people attending their shows per year and have sold more than $50 million dollars worth of merchandise, but unlike the vast majority of artists in recent history, the Grateful Dead openly allowed the free distribution of their music and live show recordings. Rather than relying on album sales as the band’s revenue stream, the Dead were able to generate financial success through the use of merchandising and touring. The Grateful Dead were able to effectively use taper sections, where fans would be allowed to set up equipment to record the band’s live performances, knowing that those recordings would be duplicated, triplicated, and dispersed to new fans and new listeners.This process wasn’t always pretty, and it didn’t always produce the best sound quality, but it worked. Today, with advancements in technology, and the MP3 file, the transfer of everlasting professional studio quality music files over the Internet is as easy as clicking a mouse. If the Grateful Dead were around in today’s world, considering advancements in technology, there is no telling how successful they could have been. However, this doesn’t stop with the Grateful Dead, with the use of peer-to-peer sharing the opportunity for success with the Grateful Dead Model are greater today than they have ever been before.
Part II of this article provides the recent history of the courts’ application and interpretation of copyright law to peer-to-peer sharing as well as other types of distribution, including one of the most recent cases, Arista Records LLC v. Lime Group.
Part III takes a closer look at the ‘Grateful Dead Model’ and how this band’s business philosophy enabled it to be one of the most successful bands in history.
Part IV examines the diminishing role of the record labels as the gatekeepers to music recording, production, distribution, merchandising, and publicizing musicians’ creative expressions.
This article concludes that through the use of peer-to- peer sharing and the Dead Model, the opportunity for success in the music industry is more prevalent today than every before, and that the real threat to the music industry is the crumbling of major record labels’ role as the ‘gatekeepers.’
Keywords: peer-to-peer, sharing, music sharing, Grateful Dead, LimeWire, Napster, Music, MP3, transfer
JEL Classification: K11, Z00, Z10, K39, K31, K29, L82, O34
Suggested Citation: Suggested Citation
Huber, Maxwell D, Victory Over Peer-to-Peer Sharing Has Record Labels 'Grateful,' But Should They Be 'Dead'? (Feburary 17, 2012). Available at SSRN: https://ssrn.com/abstract=2078454 or http://dx.doi.org/10.2139/ssrn.2078454