<story><title>The problem isn’t piracy – it’s competition</title><url>http://rocknerd.co.uk/2013/09/13/culture-is-not-about-aesthetics-punk-rock-is-now-enforced-by-law/</url></story><parent_chain><item><author>rayiner</author><text>This article is totally wrong. It mentions two very important things, but gets the implications of both wrong.&lt;p&gt;1) Competition is an issue. But competition isn&amp;#x27;t driving down prices. Despite all the music out there, people continue to gravitate towards the big record label stars. Nobody is competing by producing something people like as much as Rihanna, except cheaper. Instead, the &amp;quot;competition&amp;quot; is by delivering Rihanna for free by infringing copyrights.&lt;p&gt;2) Marginal costs of production of music are zero. But that does not mean music should be free, any more than it means iPhones should be $200 or whatever. The point about competition shows that music is not fungible. People have rejected indie music. They want Rihanna. Now, when you&amp;#x27;re talking about a product that is not fungible marginal cost is irrelevant. It doesn&amp;#x27;t how much each Hermes bag costs to reproduce.</text></item></parent_chain><comment><author>clicks</author><text>&amp;gt; Despite all the music out there, people continue to gravitate towards the big record label stars. Nobody is competing by producing something people like as much as Rihanna, except cheaper.&lt;p&gt;You seem to be under the impression that people determined her art to be of greater value and thus a higher demand for it was created than all of Rihanna&amp;#x27;s competitors. That is only very slightly true. Demand for Rihanna&amp;#x27;s music is created mostly by record companies&amp;#x27; aggressively promoting it and advertising it in various venues, not because people decided with no outside influence that her music is better than the competitors&amp;#x27;. Rihanna won because her record company is better at salesmanship than her competitors. Now her popularity is soaring in a bandwagon effect, as is typical of popstars or really any popular phenomenon.&lt;p&gt;Your point that music should not be free because of its marginal cost of production being zero is an interesting one -- just as there isn&amp;#x27;t an expectation for the iPhone price to be $200, it does indeed make sense that music shouldn&amp;#x27;t be free. But, with all the talk about capitalism being a faulty economic system these days, a particular recipient of rage -- and rightfully so, in my opinion -- is that entity which charges bad prices [1] for its goods. Now, you might be wondering why it&amp;#x27;s &lt;i&gt;music&lt;/i&gt; which gets all this drama about people objecting to its costs, and not the banking sector or something. That&amp;#x27;s because it&amp;#x27;s a thing that&amp;#x27;s close to people -- everyone listens to music, and naturally everyone wonders why it costs so much when the means of its distribution are effectively zero.&lt;p&gt;Personally I think we as a society need to first think deeply about corporations that operate essentially on a rentiering model of monetization (the recent wave of &amp;#x27;sharing startups&amp;#x27; are a prime example) and then we should worry about what is a good model of music distribution. But hey, record companies are basically rentiering companies as well.&lt;p&gt;[1]: Bad as in socially or morally irresponsible. If some company finds a cure for cancer -- and that cure, it turns out requires only $2 to make for every pill, it would not be ethical to charge an exorbitant price like $20,000 for it, no matter how much the research costs were (people dying is a bigger concern than people not getting paid). This is obviously an extreme example, but you get the point.</text></comment>
<story><title>The problem isn’t piracy – it’s competition</title><url>http://rocknerd.co.uk/2013/09/13/culture-is-not-about-aesthetics-punk-rock-is-now-enforced-by-law/</url></story><parent_chain><item><author>rayiner</author><text>This article is totally wrong. It mentions two very important things, but gets the implications of both wrong.&lt;p&gt;1) Competition is an issue. But competition isn&amp;#x27;t driving down prices. Despite all the music out there, people continue to gravitate towards the big record label stars. Nobody is competing by producing something people like as much as Rihanna, except cheaper. Instead, the &amp;quot;competition&amp;quot; is by delivering Rihanna for free by infringing copyrights.&lt;p&gt;2) Marginal costs of production of music are zero. But that does not mean music should be free, any more than it means iPhones should be $200 or whatever. The point about competition shows that music is not fungible. People have rejected indie music. They want Rihanna. Now, when you&amp;#x27;re talking about a product that is not fungible marginal cost is irrelevant. It doesn&amp;#x27;t how much each Hermes bag costs to reproduce.</text></item></parent_chain><comment><author>quahada</author><text>I largely agree with the article, but also agree with your conclusions.&lt;p&gt;&amp;gt;Instead, the &amp;quot;competition&amp;quot; is by delivering Rihanna for free by infringing copyrights.&lt;p&gt;This is a problem for Rihanna and a Maserati problem once a musician become famous, but the author states this article does not apply to &amp;quot;the majors or rock stars.&amp;quot;&lt;p&gt;The challenge faced by the indies is as old as the music industry, they have merely been exacerbated by technology. Even before the decline of music sales, the main challenge for an indie musician was discovery. I think we have a confirmation bias about the past. There have always been unsuccessful musicians, but we forget they existed. Starving artist is not a new cliche.&lt;p&gt;Have people rejected indie music or is there something else behind superstar popularity? Conventional thinking is that free music makes it easier to get discovered (but harder to monetize, once discovered) because it cost nothing for consumers to try new music. It turns out that there is so much content&amp;#x2F;competition out there now (because music cost less to produce + free distribution), consumers have choice overload. This makes it harder for people to try indie music.&lt;p&gt;Music is cultural, so what is popular follows the same power-law dynamics as social networks (in fact, it is driven by social networks). Hence, what&amp;#x27;s popular becomes more popular.&lt;p&gt;Agree that the fact that the product has a zero marginal cost does not mean people are unwilling to pay. The entire software industry is built upon a business model of building a product with high production costs and zero marginal cost.</text></comment>