Are piracy and illegal downloads the ultimate bane of our digital society, or should music companies view the demand for free entertainment products as the sign of a shifting landscape that requires new distribution models?
Alyce Lomax wrote last week about a lawsuit brought against mother of two Jammie Thomas by the RIAA, on behalf of music companies like EMI (OTC BB: EMIPY.PK), Sony (NYSE: SNE ) , Warner Music (NYSE: WMG ) , and Vivendi's (OTC BB: VIVEF.PK) Universal Music. The defendant lost the suit, and now must pay more than $200,000 to the plaintiffs.
By going after pirates, are music businesses alienating fans and consumers? Perhaps, but they should continue to do so. They have a right to be compensated for their products.
Some argue that the piracy zeitgeist actually leads to increased demand for paid downloads from legitimate sites. While there might be some truth to this, I believe that the effects of piracy are emphatically detrimental to the long-term value of a music portfolio. Just look at the effect file-sharing has had on brick-and-mortar record stores. Although filing lawsuits against music fans may not be economically feasible, I hope that stern, public penalties for music pirates will slow or stop the rate of illegal downloading.
Music companies aren't the only ones calling for change. The CEO of General Electric's (NYSE: GE ) NBC Universal division, Jeff Zucker, recently requested that the government step up its anti-piracy enforcement efforts, saying, "The unfortunate truth is that today, we are losing the battle [against piracy]." Yes, even media companies such as GE and Disney (NYSE: DIS ) are watching out for their entertainment properties these days.
I support the media companies as they fight against pirates, and I believe their efforts are a worthwhile investment for the benefit of their shareholders.
No need to pirate this content -- it's yours for free: