Film piracy increased by 38.6% last year, according to anti-piracy tech company Muso, and by 2027 the streaming video on-demand business could lose $113 billion annually from content theft, per an April report from research firm Parks Associates. With video piracy “on the rise,” as video technology provider Synamedia recently claimed, could the threat trickle down to music?
More than two decades since a Napster-led peer-to-peer file-sharing movement gutted the music industry, piracy just isn’t a hot topic in the music business like it used to be. It’s not even a mildly common topic. When discussing threats to the business, music executives are more likely to discuss newer, less-defined issues, such as generative artificial intelligence technology that re-creates the vocals of an artist without their permission. At the 2023 Music Biz conference, the closest the discussion got to piracy was a panel on streaming fraud, the practice of artificially boosting a track’s streaming count to take a larger share of royalties. A decade ago, conferences were places for creators and rights holders to air their frustrations about infringing content found on YouTube, search engines and elsewhere.
Piracy in music is not, however, gone. According to research firm MusicWatch, 55 million people globally obtained unauthorized music through a variety of means in 2022 — TikTok, peer-to-peer platforms, stream-ripping sites, mobile apps and transferring files on flash drives, among other means. One out of 10 U.S. internet globally users accessed music through file-storage lockers like Dropbox, according to MusicWatch. Muso claims music piracy increased in 2022 and tracked more than 15 billion visits to music piracy sites last year – with 7% coming from the U.S., ranking the country third behind Iran and India. A 2021 IFPI report titled Engaging With Music showed 30% of people surveyed in 21 of the world’s leading markets had used illegal or unlicensed methods to listen to or download music that year, and 14% had accessed music on unlicensed social media platforms.
While piracy is consistent and unending, it has become far easier to stomach since global music industry revenues started to rebound in 2015. After eight straight years of growth — with more gains for the foreseeable future — nowadays most consumers use legal digital platforms that offer licensed content. Some of them may access unlicensed music, but hundreds of millions of them are paying subscribers to Spotify, Apple Music, Amazon Music, YouTube Music, Deezer and other on-demand platforms. Even more consumers use ad-supported streaming options such as Spotify, YouTube and Pandora.
Some of the music piracy that does exist has taken on a different form today, where illegal activity takes place on the social media apps and streaming sites that are valuable partners to record labels. While YouTube and TikTok are filled with licensed music, they also contain unlicensed music uploaded by their users. “It’s a thin line — you can’t treat TikTok like LimeWire but we know there are a lot of files there that shouldn’t be there,” says MusicWatch principal Russ Crupnick. But it helps that labels have good relationships and a direct line of communication with these platforms. Two decades ago, the record industry’s main deterrent was a public education campaign and lawsuits against file-sharing services — and their users. Since the most pernicious offenders operated outside of the U.S. and the European Union, the legal challenges played out over many years.
The intent behind piracy has changed, too. In the years following Napster’s debut, peer-to-peer file-sharing “was gluttony without action” and people didn’t listen to 80% of the music they downloaded, says Crupnick. “It was like going to the salad bar, piling up a plate and eating two olives. Today it’s different.” Now, people are more purposeful and targeted when downloading unlicensed music. With so many legal options available for licensed music, some people search online for unreleased, hard-to-find music to add to their collections — then listen to the artists’ more common catalogs at Spotify or Apple Music.
Aside from the success of streaming services, music’s saving grace against piracy was probably the end of exclusive content. While early in the streaming era, music toyed with this strategy, offering exclusive releases to different platforms like Spotify, Apple Music and Tidal as they competed for customers, by 2016 those largely ended. Video on-demand streaming, however, has not evolved beyond this — and in some ways it’s only gotten worse. Netflix transformed video streaming by licensing other companies’ content. Now, the industry norm is to create content in-house to differentiate yourself from other video streaming platforms.
According to Muso, “releases being increasingly exclusive to a large number of legal subscription platforms” are one factor behind the continued rise of film and TV piracy. That scarcity encourages consumers to either cancel a SVOD service once they view their desired content or seek out the content on illegal sites. That trend was exacerbated during the pandemic by studios’ decisions to release motion pictures online while movie theaters were closed. Expensive live sports put cost-conscious consumers in a similar situation. Some SVOD platforms carry live sports — Amazon Prime has Thursday Night NFL Football, Apple TV+ has Major League Baseball — but being both a cord cutter and a serious sports fan can be costly.
To be sure, the recorded music industry continues to fight piracy on numerous fronts. In 2019, the RIAA said it was monitoring more than 200 stream-ripping sites. The organization maintains information about piracy on its “Resources & Learning” page that defines and gives examples of music piracy. And the RIAA continues to battle piracy in the courts. In 2021, a U.S. judge ordered two Russian stream-ripping services — which had more than 300 million global users over a 12-month period from 2017 to 2018 — to pay more than $80 million in damages in a case brought by more than a dozen record labels. Last year, the RIAA announced a partnership with the National Intellectual Property Rights Coordination Center that formalized a partnership on anti-piracy efforts. It still employs a chief content protection officer to lead those and other efforts.
Mostly, the music industry’s approach to piracy has worked. During the 2000s and 2010s, executives placed their bets on streaming platforms to raise the industry from the post-Napster rubble. Subscription services would make it so easy to access giant catalogs of music, they predicted, that piracy would be seen as an inferior experience. They were right. Streaming has succeeded in making legal options, by and large, more attractive than illegal ones. Music piracy can’t and won’t be eliminated, but it’s being managed and labels don’t have to share Hollywood’s headache.
Powered by Billboard.