We’ve all seen the figures that the music and film industries throw around in an attempt to get politicians to pass draconian laws to ‘protect’ the industries.
But Listen.com founder Rob Reid who invented the first paid music streaming service Rhapsody, which paved the way for others such as Spotify and Rdio, thinks not only are the figures grossly overstated but that they’re based on false assumptions.
“The music industry became a frustration for me on October 8, 1998,” he told Ars Technica, “the day that the RIAA sued Diamond Multimedia for releasing the first true mass-market MP3 player, the Rio. Their goal was to make open MP3 players completely illegal in this country. So, assault weapons, yes; iPods, no.”
That frustration is what drove Reid to found Listen.com and build Rhapsody which after years of asking finally got all the majors to sign a deal with the service – the first time in history. “By refusing to sell their music online for years, the labels gave piracy a monopoly on all of the great things that the Internet can enable for music lovers.”
“This meant that hundreds of millions of people discovered music downloads through pirate services, so piracy was utterly entrenched by the time we were finally allowed to compete with it, years later.”
“In embargoing their music from legal services, and greeting almost every element of today’s online music experience with lawsuits—not just MP3 players, but locker services, interactive radio services, and much more—the labels gave piracy a half-decade monopoly on awesomeness.”
“I believe that the music industry would have something close to double its current US revenues today if it hadn’t blasted itself in the foot, shin, hip, torso, and chest by doing this.”
Now speaking at a TED, who hold speeches and lectures by political and business leaders, Reid explained what he’s termed ‘Copyright Math’ as a way of explaining the often inexplicable numbers cited by both the Motion Picture Association of America and the Recording Industry Association of America as arguments against piracy.
These numbers, and others from like minded industry and lobby group, have been used as justification for a number of policy efforts including the recently proposed SOPA law in the United States which after huge public and corporate outcry was unable to pass through the US Congress.
According to Reid the RIAA, which represents the music industry in the United States, argues that $150,000 is lost for every illegal copy of a song. Based on this argument, Reid estimates that an iPod could carry up to $8 billion in pirated music.
The MPAA, who represent the film industry, throws around equally bizarre numbers such as their estimations that piracy costs the economy over $58 billion annually and has contributed to the lost of over 370,000 jobs in the United States alone.
Reid argues however that only the music industry is down in revenue since 2000, and by nowhere near $58 billion.
Speaking to PC World, Reid strongly contends that the only way to stop music piracy is to create services that make acquiring music legally painless – not over-exaggerating the problem to achieve legal change.
“I think the right answer is that there is nothing you can do to enforce prohibition in any area. The only solution is to make legal services so compelling that it is ludicrous to do it any other way,” Reid said.
“Any real music lover will appreciate Spotify: They can sample songs and taste different genres,” he said. “They would never choose a cumbersome, download-one-song-after-another trench warfare approach over Spotify. It is a simple interface, click and play, with immediate access. That’s how you fight piracy.”
You can watch Reid’s speech at TED below.