Tuesday, February 26, 2013

Indian Music Industry Exec Says The Unthinkable: 'Internet Piracy Is A Good Thing'

from the he's-saying-what-we're-all-thinking!-and-saying! dept

If you've followed this site for any length of time, you've heard many opinions on file sharing from many different people. While there are many who have taken a pragmatic or even receptive approach to file sharing (and seen a bunch of "freeloaders" cough up a whole lot of cash), there are many more who only see the downside of copyright infringement.

What you rarely, if ever, see is a top level executive of a major player in the content industry state, on the record, that not only is piracy a good thing, but it may also be a necessary thing. Here's Mandar Thakur, COO of Times Music, India, commenting on the internet's upheaval of the recording industry.
I may get lynched for saying this – but I have always believed that internet piracy was actually, in some ways, a good thing to happen to the industry. If not for that, the music industry would never have pulled its act together and embraced innovation and realised changing consumer behaviour and digital distribution. The challenges the music content industry faces are too vast to lay down here but the most significant one is the fact that the very core of the industry and its business dynamics have been shaken deep due to the consumer’s changed consumption habits and habitat, and its value proposition changed forever. It’s almost akin to consumers not wanting to pay to consume Coke/Pepsi anymore. In that sense it is as good as creating a brand new entertainment industry, creating brand new value and brand new revenue models at the same time as preserving the existing value/revenue base.
Now, before someone writes off Time Music as the equivalent of a boutique label run by three guys out of their stepdad's garage, let's take a look at the facts. Time Music, India is a division of the Times Group, the "largest mass media company in India," with annual revenue exceeding $1.5 billion and the employer of 11,000 Indians.

Much of what Thakur stated has been documented here over the years. Piracy may be a problem, but it's also a sign of disruption and an indicator of underserved markets. The problem with the American recording industry is that it spent much more time worrying (and attacking) the first item on the list while ignoring the other two. From what he's stated, Thakur is apparently uninterested in wasting much more time and money trying to eliminate file sharing. This should allow Time Music Inc. to devote those resources towards making money, rather than plugging leaks.

That he would come out and state this plainly probably won't win him any friends in the IMI (Indian Music Industry), the Indian version of the RIAA. Late last year, IMI filed a petition in support of India's IT Rules, pushing to be granted the right to take down content within 36 hours, without having to serve notice to the content creator or uploader.

Thakur may also begin irritating those even higher up on the food chain. IMI is part of International Federation of the Phonographic Industry (IFPI), best known around these parts for serving up an annual report on piracy that's riddled with factual errors and filled to the brim with pleas for various governments to save it from having to make forward progress.

Not only does Thakur view file sharing as a side effect of industry stasis, he also seems to have a good grip on what consumers actually want -- and how the rollout of better and speedier connections will continue this disruption (and its attendant opportunities).
Faster access at affordable prices has always created a massive boost for consumption. At one point it was content that was king, then the portable device became the centre of the digital universe and now it’s the war of the OSes. The underlying factor across all these spurring growth (or preventing growth) has always been access and in this particular case it’s the global LTE and LTE Advanced roll- outs that will accelerate growth, especially in large countries such as India, Indonesia and China. This [growth of access] will be nothing short of an internet revolution, due to the wide-scale consumption it will create as common people’s daily habits change.
This is also refreshing. Rather than viewing across-the-board increases in bandwidth as nothing but a more efficient conduit for infringement (see also: the MPAA's comments on Google's fiber rollout), he sees it for what it is: an new, rapidly expanding market.

It's great to see such clear thinking from someone inside the industry. IMI and IFPI may not be happy with a pirate-loving COO heading a major music outlet, but it appears he's in place to catch a new market on the upswing, an uncommon experience for those in his position.

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