New model needed for recording companies?


Despite all effort to the contrary, the legal sale of downloaded music remains the small end of the market, with the lion’s share of business going to illegal P2P sites. Is it time for the conglomerates to face the situation?

An article at notes that sales partterns are still what they always were in the vinyl and CD eras, in that both legal downloading and illegal P2P sharing focus on big hits, with far less activity for fringe acts. But the genie is out of the bottle on P2P. British royalty organization PRS for Music suggests its time for producers to stop going after illegal downloads and start working out a way to license sharing sites so cash again flows to labels and artists.

A study called “The Long Tail of P2P” documented these trends. The hits which comprise the majority of downloads would comprise the body of a download beast, and the long skinny tail would be comprised of the more esoteric material that only occasionally finds a taker.

PRS economist Will Page said, “The study allows PRS for Music to understand an illegal digital market for music that’s been with us for longer and is far larger than the legal one. By doing so, it helps move the PRS for Music forward with the challenge of monetizing it on behalf of our songwriters.”

RBR/TVBR observation: At the moment, the labels seem more intent on destroying their relationship with radio and the free promo that comes with it – even though it is critical to generating hits, and hits are still the name of the game. They’ll probably also continue to sue college students – and lose money.