Why is the RIAA like a drunk under a lamppost?

You know the joke, right? A man sees his friend, obviously drunk, on hands and knees under a lamppost and asks what he’s doing. “I lost my car keys,” answers the souse. The man looks around and says, “Isn’t that your car down the block? Why aren’t you looking there?” And the drunk replies, “Because the light is better here.”

For years, the RIAA has been telling us that the Internet is destroying the music business. For a long time it was P2P file sharing. More recently the menace is the cloud and bit lockers. To combat the online enemy, they’ve sued deceased grandmothers, distributed spyware-laced CDs, arm-twisted Congress for ill-conceived legislation, and enlisted ISPs in a massive program of extra-legal coercion. Like a moth to the flame, the RIAA has been besotted by the Internet lamppost, and yet their own statistics point in a totally different direction.

A few days ago, TorrentFreak wrote about a leaked internal RIAA confidential report from NPD that contained this analysis of music acquisition:

You have to be pretty drunk to miss the sobering implications:

  • In just one year, the P2P problem decreased from 21% to 15%, which is a reduction of more than one-fourth. Someone should be firing off skyrockets and celebrating success.
  • While unpaid distribution through bit lockers increased from 2010 to 2011, the total unpaid Internet-based percentage still declined from 24% to 19%. Again, if the goal is to defeat the Internet, someone’s doing something right.
  • But the elephant in the room — apparently not pink, or the RIAA might see it — is that unpaid music acquisition has relatively little to do with the Internet. The categories of unpaid distribution based on in-person exchanges dwarfs online activity by more than a factor of two, and the disparity is increasing (44% vs 24% in 2010 and 46% vs 19% in 2011).

As ITworld said, “If you want to blame someone outside the music industry for its demise, you might as well blame mix tapes.” And this is hardly a new development: In 2007, the New York Times reported another NPD study attributing 37% of all music consumption to social ripping and burning among friends. The technology disrupting the legacy music business isn’t broadband, it’s flashdrives.

Of course, the real answer to the music industry’s woes is a new business model, one based not on monopoly and artificial scarcity, but on the public’s love of music and their willingness to pay reasonable prices for quality content conveniently delivered. There’s no shortage of articles and studies supporting this idea and explaining how it’s already happening. My favorite is The Sky Is Rising!, by Michael Masnick and Michael Ho.

Unfortunately, the RIAA shows no interest in sobriety, refusing all advice and all offers of treatment. Look for them under a lamppost near you.

/Steve/

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