This was brought up in the overweight thread but I think it deserves its own thread. A poster there said, Other posters pointed out that before music downloading CD's where more expensive than they are now and there didn't seem much movement in prices then and that even without piracy record companies have little impetus to lower prices. I think that piracy has actually helped to motivate record companies to lower prices. Consider that with piracy the record and other media companies cannot just rely on enforcement to stop it since it is too easy to get around it. I believe the threat of piracy has helped to push media companies to look to new ways to provide music and other media at lower prices that are competitive when you consider a built in disadvantage, illegality, of piracy. So now we have things like I-Tunes, Netflix, Hulu and etc. that provide media legally and cheaply, or even free, without the hassle of dealing with torrents or risk of possible fines and lawsuits. While these things might've existed without piracy I don't think you would see them getting the amount of material without the threat of piracy.
It doesn't seem like CD prices have gone up in a long time. Haven't we been paying the same price for the last ten or fifteen years?
That poster is an idiot. It is completely the opposite. If d/l-ing stopped, prices would increase. This is Economics 101...supply / demand. imso, this is not even up for debate. this is not theory.
Yep. If there was no thievery, I truly believe I would be paying less than 99 cents (or $1.29) on iTunes. I also believe I would pay less for MS Office or other software. I would be paying less for DVDs as well.
What would be the impetus for the companies to do so? Artistic media doesn't exactly work like a commodity market, Island records isn't going to lower the price on U2 CD's to undercut Interscope's Lady Gaga CD's. Since their popularity isn't just priced based but the popularity of the artist and the label's have a contract with the artist. If anything the labels are going to raise the prices as much as possible since they control the distribution method and their competition is based on which artists they sign. Now with piracy the record companies no longer control the distribution method on any single artist and in that case they have a legitimate price competition and have to find a way to address that competition. What you are saying though is that leaving the distribution method in the hands of the record companies that they will on their own lower prices since they aren't worried about losing revenue to piracy. I just don't see that happening.
If someone started giving away gasoline for free, would that increase the price at the pump or lower it?
Bad example. Gasoline is a finite source. There is a loss somewhere in the production line to simply give it away. In piracy, the only loss is the potential sale. Monopolies always lead to higher prices. One of the reasons piracy was so prevalent is due to high cost of CD's to the consumer. Raising prices to compete with piracy is a silly notion. Raising prices will only lead to a slump in sales due to people not willing to buy it or resorting to piracy. Piracy has greatly assisted in the creation of services like itunes and netflix.
Piracy doesn't exactly mean lost sales either. Some people pirate things because they can, it doesn't mean that they would have purchased the good if they weren't available to pirate. This probably applies to poorer people, especially in other countries.
Who cares if companies drop their prices or raise then when it's so much easier just to steal from them?
Glad you brought this up. I'm one of those that "sampled" artists' works first. 30 second samples of off websites aren't enough. Neither are single listening sessions to eliminate novelty songs. For me, after 3 full listens over a long period of time, I commit to buying merchandise, albums, concert stuff et al from them. Bands that fall under this criteria are U2, The Pixies, or the Killers. Piracy allows me to analyze an artist's entire discography to give me a better picture of their music, and in doing so, they guarantee future money from me. In the old days, buying a $20 CD from an artist gave me too small a sample to effectively know their work. If the one CD were their weakest effort, it turned me off them entirely. All about short-term album sales (artists initial preference) vs long-term customers (given the status quo, the best interest for producer and consumer).
The prices of CDs were plummeting prior to the online file sharing extravaganza. You could get new release CDs for about $18 bucks a pop --> now that's a steal.
It depends... Do artists lose money? No, not really. Realistically, artists make about 2 cents to a dollar each CD. The companies "lose" money, but in actuality it isn't much. As for software, I don't think software piracy is as rampant as music piracy. Personally speaking, once I am done with my undergraduate career, I will no longer pirate software at all. Right now, it's more of a matter of the fact I cannot afford the software, but when I can buy it, I do. That's why all my machines at home have legit versions of Win7...
Guys, stop debating this. It really isn't up for debate. This is Econ 101. Why some of you think the music industry is special is weird. Point is, anyone who thinks raising prices to offset lack of sales actually works is naive. The year after Steve Francis's injury, before Yao Ming, we won like only 34 games, they freaking raised prices. The Marketing Director (who got fired prior to Tim McDougal) was quoted on the front page of the Chronicle..."we are raising prices to offset lack of sales." Yeah, she got fired. To this day, I still think she couldn't have been that dumb, that Les made her say it or at least defend his price increase. Gasoline isn't really a finite entity more than any other product....like the Wii. Production just might lag behind demand. A finite product is Rockets tickets. Les actually thought he could cheat the law of price elasticity. He failed miserably, as his totals revenue dropped.
Supply and demands says an increase in prices but you also have to consider competition. If somebody ever puts up a model that distributes a song even cheaper than iTunes and can still make a profit because there are so many buyers, then, sure.
If there is one thing im an expert on, its software pricing. There is a common saying is software sales, "don't leave any money on the table." Free software is the reason we lower prices
I don't pay that much attention to the music price "at the pump" when I really want to buy something. But I can say its overall cheaper nowadays to get all the legal music I want, compared to 15 years ago. And back then I always waited until albums were USED. These days there's always some free music coupons and site trials and offers you can get legally. ( Even if its more expensive now, it beats the days of mail-in order "Buy 20 Cassette Tapes for 1 cent!" offers. ) I think MAYBE things like cable sports packages and things like NFL Sunday Ticket are marked up in price to make up for losses in online streaming of games.
