Is Streaming Really Replacing Downloading?

from the perhaps-in-some-cases... dept

Mon, Jul 13th 2009 12:20pm — Mike Masnick

Lots of attention is being paid today to an article in the Guardian about a new study claiming that illegal file sharing has collapsed in the UK and is being replaced by streaming music found on YouTube and through services like Spotify. The premise of the article is that now that kids have alternatives, they're willing to dump unauthorized file sharing and get by with streaming. While I don't doubt that it may be true in some cases, I'd take these findings with a pretty large grain of salt for a variety of reasons:

It's not based on actual usage data, but on survey data.
As more and more attention is being paid to people getting sued and fined for online file sharing activities, people are certainly going to be less willing to admit on a survey that they participate.
This is especially true in the UK, where there's been a tremendous amount of attention on the recent Digital Britain report, which claims, as a goal, to reduce illegal online file sharing activities.

That said, it wouldn't surprise me at all to find out that some users have modified their behavior due to the ease of use from online streaming platforms. When I was in the UK, I got to play around with Spotify, and I could see how many people might start using that as a replacement for file sharing much of the time (and demos of Spotify's mobile app that include syncing features when there's no internet connection make it look quite compelling for even offline music playing).

However, even if we take what the article says as proof, it seems quite likely that the industry will muck this up too. Already, we've seen that Spotify is running into licensing problems, and the company is nowhere near being able to turn a profit. And, of course, the industry is pushing for increasingly unsustainable webcasting rates. That's why YouTube and PRS still haven't come to an agreement over all that streaming music in the UK, and even as PRS has tried to lower its rates to make a deal, some of the record labels are actually demanding the rates be pushed back up.

This is how the legacy industry kills anything even remotely positive. The second that the industry sees anything that's working, it suddenly smothers it by demanding to get a bigger and bigger cut. We've seen it for years. As soon as iTunes started to be successful, the labels pushed to get a bigger and bigger cut from any sale (and to push the prices of each song higher). More recently, with the massive success of video games like Guitar Hero and Rock Band helping to promote music (and making musicians a ton of money), the labels have been demanding a bigger cut as well.

Rather than understanding how to create and foster a healthy music ecosystem, it seems that some of the major label bosses have learned how to do one thing only: squeeze each tiny baby lemon as hard as possible until it's dry, never giving it a chance to actually grow. And then they wonder how come each new revenue stream doesn't make as much money as their old way of doing business.

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Filed Under: downloading, recording industry, streaming
Companies: google, spotify

27 Comments

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:Lobo Santo (profile), 13 Jul 2009 @ 12:30pm

Pssh!
No, streaming is not replacing downloading.

At least, given the negligible state of broadband in the US--it takes at least 10 hours to download a quality movie; and there's no way I'm waiting 10 hours for something to buffer.

So, downloading is king--until broadband gets better.
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Yes, 13 Jul 2009 @ 1:00pm

Yes
Yes. Next Question.
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Anonymous Coward, 13 Jul 2009 @ 1:12pm

I already prefer streaming
The only shows I still download are only available to me in that format.

I stream using hulu and netflix. My netflix streaming que has about 120 videos in it. My hulu queue probably has about 50. If a show doesn't make it easy for me to watch, I don't see it.

I'm the future too. Kids today play games, they don't watch cable. Profiting from video entertainment is going to be increasingly difficult. The concern will be getting people to watch.

Locking things away only results in people not caring.
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Anonymous Coward, 13 Jul 2009 @ 1:34pm

Streaming
The first thing I do is check Youtube to see if I can listen/watch something on there, then I'll try Google for another source... Only then do I resort to downloading it from wherever, because I usually only want to listen to it once anyway. Of course, they took most of the official music videos off Youtube as well... They are only screwing themselves over.
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Rekrul, 13 Jul 2009 @ 1:36pm

Re: Pssh!
o, streaming is not replacing downloading.

At least, given the negligible state of broadband in the US--it takes at least 10 hours to download a quality movie; and there's no way I'm waiting 10 hours for something to buffer.

Who said anything about movies? This article is about MUSIC, which as everyone knows is the center of everyone's lives.

People can live without movies, but would die a slow, agonizing death if their daily music "fix" were cut off!!!!!!!!!!!!!!!!!!!!!!!
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PaulT (profile), 13 Jul 2009 @ 1:37pm

Re: Pssh!
You do realise the article is talking about music, not HD video, right?
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chris (profile), 13 Jul 2009 @ 1:47pm

you can't trust streams
will they be there in the future? will that awesome youtube video get yanked down for some arbitrary reason?

it might be good enough for some, but not this guy. i'd rather trust the pirates.
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Anonymous Coward, 13 Jul 2009 @ 1:59pm

i never download tv shows or movies when i can find a streaming site. i will admit that my bittorrent client is often active downloading ebooks, (i play many pen and paper games and have very little money for books)
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Adam, 13 Jul 2009 @ 2:05pm

I hope the RIAA dies painfully because of its greed
I am all about making sure the artists get paid for their work but i do not like the RIAA and i definitely know they take more money for themselves than they give the artists. I personally feel every new avenue that produces some exposure they take and they ruin it to where no one uses it and then they wonder why their CD sales suck horribly. If you leave the free advertising alone maybe you would sell more CDs. Learn to business RIAA hope you die off.
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Streamed Music = Free MP3, 13 Jul 2009 @ 2:11pm

They are ignoring the fact that there is plenty of software that allows you to capture streamed music to an MP3 file. Why risk getting caught using torrents when you can simply rename a file copied to your cache directory?
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Copycense, 13 Jul 2009 @ 2:18pm

Lobo Santo alluded to this somewhat in his post, but one issue that really has not been addressed is the net neutrality angle. In other words, how can we (at least in the U.S.) even consider a streaming solution if the ISPs are going to prioritize traffic based upon suspicion of illegal activity? Additionally, how can U.S. citizens even consider streaming as an alternative when our ISPs' top download speeds are woefully beneath what average customers receive in the EU?
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Tom, 13 Jul 2009 @ 2:45pm

The report wasn't comparing survey to actual behaviour, it was pointing out that claimed file-sharing has collapsed from a previous iteration of the same survey. File-sharing prosecutions were just as much in the news in 2007, so the fear explanation doesn't really wash. As for Digital Britain, this survey was done in January, well before DB came out (I suspect teens weren't paying attention to DB anyway).
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Tom, 13 Jul 2009 @ 2:48pm

Where the survey is flawed - and the Guardian article hints as much - is that a lot of teenagers think of "filesharing" as something you do on the computer, and they swap and share music via bluetooth on their mobiles. So the terminology in the study may not have kept up with behaviour.
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DJ (profile), 13 Jul 2009 @ 3:17pm

Re: I already prefer streaming
again...

talking about MUSIC

M-U-S-I-C

not

V-I-D-E-O

Although the technology used to stream video is very similar to the technology used to stream music, this particular article doesn't care.
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DJ (profile), 13 Jul 2009 @ 3:23pm

Re: I hope the RIAA dies painfully because of its greed
RIAA should take a lesson that should have been learned in the 80's: Music videos. When MTv first hit the airwaves there was a feeling in the industry, albeit minor, that music videos would completely take over and there would be no more sales without video. And no I'm not just talking about the Buggles's song.

However, as we clearly now know, that didn't happen. In fact, music videos ENHANCED music sales. Come on RIAA figure it the f!@# out already!
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Anonymous Coward, 13 Jul 2009 @ 5:04pm

"I'd take these findings with a pretty large grain of salt for a variety of reasons"

Most of which have to do with the article's content not meeting up with Masnick Universal View of FREE!

More holes in a swiss cheese theory.
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Dante Cullari, 13 Jul 2009 @ 5:28pm

I somewhat agree
I am the Founder and President of an alternative model for the music industry called Beat-Play. Check out our website in the forums for more info.

Eventually I see the music industry using this streaming model much more with the addition of the ad revenue model. I see the most popular artists eventually being able to support themselves completely from ad revenues based on hits to their streaming songs, public profiles, and also video plays. I know that Beat-Play will be experimenting with giving artists ad revenues for their streams. We are also home to the first music stem auction, and we only take 5.5% of each sale. We don't charge to post, so we also Promote artists for FREE in a number of different ways. One of these ways will include allowing friends to share the music they find with their friends freely, almost Pandora style, and utilize these social networks to help artists get streaming hits. With this model the music you like could find you. This way, the artists still get paid, and the fans get the music for free and can still share it. We will also have the option available for artists to sell their music. But we feel a combination of both methods will be needed in the future to serve different artist's needs. We are currently still in development stages with Beat-Play, but to sign up as a BETA TESTER for our Fall 09 release, go to http://musicwithoutlabels.com About us Video is coming soon, go to the forums to learn more for now.
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Glenn, 13 Jul 2009 @ 6:00pm

Re: Re: Pssh!
"People can live without movies, but would die a slow, agonizing death if their daily music "fix" were cut off!!!!!!!!!!!!!!!!!!!!!!!"

Sarcasm... I like it!

Screw the music, and the industry that spawns it. And even though the movie industry is no better than the music industry (nor any smarter), I'll still buy DVDs for the foreseeable future... when they're on sale for $5 or less (and the occasional few at almost any price--'cause I'll watch them over and over and over again.
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RD, 13 Jul 2009 @ 6:24pm

Nice!
"I am the Founder and President of an alternative model for the music industry called Beat-Play. Check out our website in the forums for more info."

Hey sounds great! Looks like you have a good, solid handle on the technology, the market, how to make everyone money, and most importantly what the consumer WANTS.

We will miss you! You see, you have figured it out, and the music industry WILL NOT allow this to stand. Somehow, someway, they will stifle, threaten, litigate, coerce, or outright try to buy you in order to shut you down.

If they cant control it directly, it must be eliminated. Sadly, this is the modern music industry. I salute your valid attempt at this, and will mourn you when you are gone.

I am only being somewhat facetious....
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PPNSteve (profile), 13 Jul 2009 @ 9:37pm

streaming != downloading
Streaming is all good and fine for when you are at work or home and have access to a pc for the streams.

Pretty much useless for loading your mp3 player, for remixing(fair use or not), or making a mix cd for your next road trip.. you can ONLY do these things with a physical file download (or cd rip, IF you wasted your money on the cd) in a high bitrate or lossless format.

Streaming is for all intents and purposes, just like basic fm radio.. useful for s few things and that's it.

This applies equally to BOTH video and audio sources.
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Auditrix (profile), 14 Jul 2009 @ 12:42am

Streaming is the Future
Why would you download if you didn't have to?
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Duncan, 14 Jul 2009 @ 1:22am

Spotify
I know you've had a go on Spotify, Mike, but I think it's difficult to see exactly how useful it is until you actually start using it for the vast majority of your music playback.

I'm a massive music fan, and rarely drop out of Spotify these days, despite having stacks of CDs in the other room and having spent a fair bit of time on bittorrent and other services in the past.

The truth is that it takes me less time to boot Spotify and play a track than it does to trawl through my MP3 collection, wait for my music player to load, and then play it. It's just more convenient.

Anecdotal evidence, I know, but I can believe that filesharing in the UK among the mainstream is decreasing for exactly those reasons.

Spotify has a surprisingly high profile over here, and Bittorrent's only real advantage over it is the catalogue. Sure - there'll always be die-hard pirates who keep sharing, but the general public who are mainly confused by Bittorrent may well be abandoning it.
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Ilfar, 14 Jul 2009 @ 6:59am

Streaming is too expensive
I use mobile broadband, I pay NZD$40 for 512Mb of bandwidth a month. Streaming is simply not an option.
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tristan, 14 Jul 2009 @ 7:56am

Streaming might reach new hieghts but downloading is still strong
I think that the report for the 15 year old is unreliable for a slew of reasons, but I do think that the potential in streaming has to do more with its ease of access and how it saves up disk space. I do not think it is related to anti-piracy measures/pressure, its just more convenient when on the go. Concerning teens that stream, you have to consider that a lot of them share family computers where downloading hundreds of song is not allowed/possible and so they stream.
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Mike Masnick (profile), 14 Jul 2009 @ 10:37am

Re: Spotify
Anecdotal evidence, I know, but I can believe that filesharing in the UK among the mainstream is decreasing for exactly those reasons.

Right. I tried to say that in the post. I wouldn't be totally surprised if it was true... but the point was that the industry would muck it up.

Still... that Morgan Stanley "analysis" by the intern suggested that his friends don't trust streaming services, and given that the industry will probably screw it up, they might be right.
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RUNA CROUCH, 14 Jul 2009 @ 2:32pm

PAY PER DOWNLOAD
BACK WHEN THE REVOLATION OF NAPSTER CAME INTO SOUND I HAVENT BEEN THE SAME. IT WAS NICE TO JUST POINT, CLICK AND LISTEN TO YOUR FAVORATES OF THE PAST AND PRESENT. MONEY SEEMS TO PLAY AN IMPARCEL PART OF THE HUMAN EXPERIENCE FOR ENSTANCE: WHITH ALL OF THE VISUAL AND SOUND EFFECTS AVAILABLE THEN AND NOW IT ALWAYS CAME ABOUT BY HUMAN TEAM WORK OR A FLUKE DISCOVERY OF A GENIOUS. BEING FAIR ABOUT PRICES IS ONE THING BUT BEING DOWN RIGHT GREEDY IS ANOTHER. MOST OF THE MUSICAL, VIDIO DOWNLOAD WEB SITES ARE NOT INTO THE HUMAN FACTOR. THEY ARE INTO MAKEING MONEY...THAT'S IT!! SO WHAT DOES DETERMINATION ON THOSE WHO SEEK TRUE FREEDOM DO? THEY KEEP PUSHING FOR THAT ULTAMATE FREEDOM, FOR WITHOUT THE OUT-REACH, YOU ASSHOLE'S WILL DECIDE TO CONTROL THE MIND, BODY AND SPIRIT.............
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Simon, 15 Jul 2009 @ 2:50am

Spotify
I'm not sure if they are making money, but they are certainly adding huge numbers of songs to their database: every time I look at the blog, they've added more songs in the previous week than I have in my entire collection. I obviously aren't interested in all that music, but even so, there's a huge variety.

I'm going to a small-scale festival next month and I'm checking out the bands on Spotify. So far, I've been able to find nearly everything I want. Like Duncan, I'm using Spotify more and more. My only issues are: sometimes my connection is too slow to stream properly, and (like Mike said in his reply) the risk that the industry will screw it up. But right now, it's near-perfect.
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