For better or worse, peer-to-peer file sharing has completely revolutionized how people discover and consume music during the course of the last fifteen years. Piracy played an important role in how music was distributed through the black market throughout the latter half of the 20th century. However, it was not until around 1995 that casual music lovers began using the internet to illegally download unlicensed content on a massive scale. The mainstream music industry reacted by attempting to crack down on individuals who were pirating music and the services that allowed them to do so. Eventually, the industry learned to adapt to how users were harnessing online resources to pirate music and began using very similar techniques to market their products legally.
One of the most telling examples of the profound influence that internet piracy has had on the music industry is the sale of retail CDs. Until the past few years, CD sales were one of the key indicators that music industry insiders used in order to measure which musicians and albums were the most popular with the public. As a growing segment of the public made the migration to digital music and internet piracy, sales of retail CDs dropped amongst younger consumers to such an extent that the best selling CDs on the market began to bear very little resemblance to the music that was actually popular with the young listeners that form the backbone of the music industry. For example, Bob Dylan’s album Modern Times quickly became the number one best seller when it was released in 2006, despite the fact that none of his tracks were highly requested on mainstream radio programs or popular with most younger listeners.
For most people, the most well-known case involving internet piracy and the music industry occurred in the year 2000 when a group of major recording companies took peer-to-peer file sharing service Napster to court for facilitating copyright infringement. After roughly five years of losing revenue through increasingly rampant internet piracy, A&M Records and a handful of other record companies successfully sued Napster on three separate claims. These claims included accusations that Napster liable for vicariously allowing users to infringe upon existing copyrights and were even encouraging users to download unlicensed copyrighted materials. Once the recording industry won this landmark lawsuit, Napster ceased offering their file sharing services to users and soon filed for bankruptcy.
Today, most people who make the decision to download music illegally do so by using new peer-to-peer networks like BitTorrent. The BitTorrent protocol is capable of handling massive amounts of data very quickly and is notoriously popular for individuals who upload and download unlicensed copies of movies and television programs. In more recent years, dozens of major record labels and Hollywood studios have begun offering legal videos and tracks through BitTorrent in order to distribute their content on their own terms and avoid the pirating of their content.
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When it comes to understanding internet piracy and the music industry, it is important to note that the legality of downloading unlicensed copies of music over the internet vary considerably from one part of the world to another. For example, Canada is extremely tolerant of internet piracy and has gained a reputation for providing a legal haven for file sharers. Illegal file sharing has become such a major part of the culture in countries like Spain and China that the music industry no longer considers it possible to make a profit by distributing their content through traditional methods. As a result, some music studios and filmmakers refuse to even market their products in these regions in order to protect their products from rampant copyright violations.