Last week, we reported on a study being conducted by Universal Music Group‘s parent company Vivendi SA, with the help of Bain & Company, on the projected record sale revenue of a marketplace without pirating or ‘freemium’ services. Today, Digital Music News has released further information about the report.
In one scenario, Bain found that if piracy and free content ended tomorrow, recording sales would multiply 17 times within three years.
Their hypothetical scenario, while perhaps an effective albeit longterm solution to the pirating problem, was described by an inside source in a way that would make skeptical even the most steadfast defendant of the idea.
The first year is when everyone will be complaining, and refuse to buy. But then it’s like everything else, where you pay because you have to. Then, you start to see the recovery, then the big increase.
This corespondent believes that when the public is forced into purchasing streaming services’ premium subscriptions, they may simultaneously go for vinyls and CDs. Universal’s overarching strategy to eliminate ‘free’, nicknamed “Piracy D-Day,” plans to tackle several large areas in the industry. First, sites like Grooveshark and their associated domain names will be removed. ISPs will be used to block certain pirated content and crack down on them with more detailed and thorough inspections. These sites and individuals will be pursued with heavier legal action. Finally, they plan to involve high-ranking national and international politicians.
Politicians, just like the artists, have always been scared to speak against piracy because they feared the backlash. With current [cross-Atlantic] trade discussions, we’re seeing that change, and Hollywood is helping that.
While Universal plots and schemes, several figures at Vivendi are placing their finances and trust in the ongoing success of certain streaming sites. They believe the freemium trend to be “solvable, and reversible,” rather than something to be completely destroyed.
There’s a reason these investments are happening. Remember, these aren’t dumb guys…
As the disagreement and chaos continues within Universal Music Group, and amongst themselves and other labels/services, it isn’t clear whether their decision will land in favor of attacking freemium services or working with them for their own benefit. Although discord exists between the figureheads, it seems that those with the heavier wallets will ultimately decide how the record label proceeds.
Source: Digital Music News
