#debate: Can Music Piracy Ever Be Ended? Streaming Hasn't Done Much Either

Perhaps by definition, piracy — unauthorized copying — is a thing that can never be got rid of. After all, the modern music industry got its start from the very fact that music can be copied.

#debate is a new QDaily column that takes up interesting, contested questions. We know we stand on the shoulders of those who came before us.

The International Federation of the Phonographic Industry (IFPI), long exasperated by rampant piracy in China, rarely has a good word for the country. In a report released recently, IFPI wrote: "Chinese consumers have a very strong connection to licensed music." The report cited figures to back this up: among people in China who listen to music, 96% choose licensed music.

That conclusion came out of a survey of 2,000 Chinese consumers, and the number is puzzling in one respect. It does not simply mean that only 4% listen to pirated music, because people who listen to licensed music may listen to pirated music too — or the respondents may have been lying.

Even if 96% really do listen to licensed music, that may still amount to very little for anyone hoping to make money from music. Over the past few years, streaming and smartphones spread and the National Copyright Administration stepped in, and the music people hear on their phones through apps from Tencent, NetEase and Xiami really has become entirely licensed. Yet according to Tencent Music's latest prospectus, only 2.8% of people pay for it. Whether the habit of listening to licensed music — bought by giving it away free — can last is still an open question.

Worldwide, piracy shows no clear sign of decline. Line up several years of IFPI's annual reports and you can watch the share of people listening to pirated music rise from 35% in 2016 to 40%, then slip back to 38% in 2018.

The most popular way to listen to pirated music now is stream-ripping. Of the 38% who infringe in IFPI's report, 32% rip streams. Stream-ripping means using dedicated websites to pull audio out of a streaming service and save it to your own device. On streaming platforms like Spotify or NetEase Cloud Music, downloading is a feature only paying users get.

People once imagined that technology could build tougher copy protection into music and so solve piracy. When streaming first appeared, for instance, hopes ran high precisely because there was no directly copyable file like an MP3. Those attempts do not look successful.

Perhaps by definition, piracy — unauthorized copying — is a thing that can never be got rid of. After all, the modern music industry got its start from the very fact that music can be copied.

In the 19th century and earlier, music was usually local; every place had its own folk songs. With no medium to carry music elsewhere, exchange between regions was rare. Printing had matured enough for sheet music to let classical works be performed across the European continent, but that took a full symphony orchestra, and orchestras under different conductors were hard to hold to one style.

Unlike literature, painting, poetry and sculpture, "music was the last art to break free of the constraints the human body placed on oral transmission," the British historian Eric Hobsbawm wrote in The Age of Extremes.

The phonograph, and another machine called the player piano, changed the old rules of the game. From then on, music could be reproduced by machine.

In 1877, Thomas Edison built the first phonograph in human history. As the name suggests, it kept sound and could play it back. Later the German-American inventor Emile Berliner improved the way the phonograph reproduced sound, much as he had improved the telephone. The new version played louder and distorted less.

Meanwhile, inventors tried to fix keyboard music onto perforated paper rolls, and ended up making the player piano. The piano rolls mounted on the instrument turned it into a self-playing machine.

"Before Edison and Berliner, every acoustic phenomenon was formed by time and space acting together. Within a given stretch of time it appeared in one place, and then it vanished forever. The designs of Edison and Berliner changed all that. At the same time, Edison's technology lost to Berliner's, because Edison's only let users record sound themselves, while Berliner's could be produced in all sorts of other ways. Berliner's discs were far easier to manufacture, transport and store than cylinders," David Suisman writes in Selling Sounds. "Ultimately, the commercial strategy of expanding disc recording redefined the place of music in American life."

Sound, which had always vanished as it was made, became a commodity that could be sold. Record sales climbed steeply, from 500,000 copies in 1897 to 2.8 million two years later. Sound became property, and only once music was a business did the question of who owned it produce the first copyright fights over licensed and pirated music.

Copyright arguments today tend to circle a more metaphysical question — whether knowledge should belong to anyone at all. But in the years when the music industry was taking shape, the real problem was the tension between creating mass demand and making a handsome profit.

"In the 1910s and 1920s, coin-operated player pianos could be found in many public spaces, including amusement parks, billiard halls, outdoor beer gardens and cafés, candy shops, tobacco shops, clubs, dance halls, drugstores, department stores, grocery stores, hotels, quick-service restaurants, newsstands, postcard studios, train stations and restaurants. At the same time, although the phonograph parlors of the 1890s had disappeared, phonograph companies went on promoting the phonograph in public, from hotel lobbies to parks and schools. Salesmen often demonstrated how to use the phonograph at picnics, parades and other local events," Selling Sounds recounts.

Publishers claimed that the mechanical reproduction of sound infringed their copyrights. Behind the claim sat a contradictory wish: they wanted their songs to spread far and wide, and they wanted to keep the songs for themselves. The phonograph had used copyrighted material from the day it was born, but publishers took no notice until later, when they began objecting to other industries using their music.

Under pressure from publishers, the Copyright Act of 1909 let copyright holders license their works for mechanical reproduction and required manufacturers to pay a royalty of 2 cents per copy. It cost some prominent composers the chance to bargain for higher royalties on their own, but its value to creators as a group was plain. America's first Copyright Act, in 1790, said nothing about copyright in musical compositions, and even noted specifically that it did not forbid copying the works of foreign authors.

Piracy or the licensed version was not a choice faced only by people in the music business in the early 20th century. It comes up in any untapped market.

In the 1980s, when Chinese people first heard pop songs from Hong Kong and Taiwan, most of what they heard was illegal. The newspaper Xin Wan Bao quoted the composer and cassette collector Li Shouhua: "It was around the end of 1979 that cassette tapes started coming into the mainland from Japan and Hong Kong, and they quickly caught on. Mostly people listened to Hong Kong and Taiwan pop — singers like Zhang Mingmin, Cheng Lin and Cheng Fangyuan were all the rage. A pirated cassette back then cost just 3 yuan, while a licensed one at the bookstore cost 20 to 40 yuan."

By the early 2000s, Baidu MP3's share of the market had at one point passed 90%, and most of that music came from highly dubious sources. But buying a player for a hundred yuan or so, downloading a few gigabytes of songs and playing them over and over was also a fashion of the moment. Those people may not have been music consumers, but they widened music's reach.

Piracy and the market are not always an either/or, of course. In the 1980s, the fact that CDs could be copied helped piracy along, and yet licensed CD sales rose steadily too. Back then, piracy and the market did not conflict.

Brothers in Arms, released in 1985 by the rock band Dire Straits, is one of the best-selling albums ever, with 30 million copies sold. Its most important milestone is not the total, though. Of the copies sold, 1 million were CDs — the first time in history that an album sold more on CD than on vinyl.

CDs had reached stores three years earlier, and Brothers in Arms announced that the CD era had arrived. Three years after the album came out, annual CD sales passed vinyl. Three years after that, CDs passed cassettes to become the most popular music medium.

Philips and Sony developed the CD together in the early 1980s. Thanks to digital recording, CDs sounded better: no scratching noise, and none of the distortion vinyl and tape suffer as one side nears its end. They immediately became fans' new favorite.

The CD's digital format made ripping easy, and pirated copies sounded decent too. But before the internet, the law still worked fairly well on copyright, since a medium like the CD existed as a physical object and physical evidence was easy to gather. Nor did the music industry stop growing: after 1983, global CD sales rose for 17 straight years, peaking at 2.45 billion discs in 2000.

The line between piracy and licensed use is not always clear, since nobody writing the rules can foresee how media will develop. Sometimes the blur even bred fascinating culture.

The U.S. Copyright Act of 1909 granted the right to perform musical works publicly "for profit." But the act did not treat a coin-operated jukebox reproducing or performing a musical work as a public performance for profit, unless a fee was charged to enter the place where the reproduction or performance happened. In other words, in a bar or a restaurant with no "admission fee," a customer could drop in a coin and pick a song, and the jukebox's owner owed nothing in royalties.

The jukebox exemption was added at the last minute as a compromise while the 1909 act was being drafted, and it brought consequences nobody intended. By the middle of the 20th century, jukeboxes were among the most important commercial users of music, yet jukebox operators paid no royalties at all. So from the late 1950s on, bills kept appearing to abolish or amend the anomaly. The United States abolished the jukebox performance exemption in 1976.

Still, those years free of copyright were enough for the jukebox to build a pop culture of its own. After the Second World War, as American entertainment grew richer, the jukebox became standard equipment in restaurants and bars: for one coin, people could eat, talk and even dance to music. It also shed the stiff wooden-box look and put on a bright gold coat. It became the growing-up memory of a generation. Someone picking a song on a jukebox to lift the mood, or dedicating one to a sweetheart, turns up again and again whenever film and television want a retro feel — in Friends, for instance, when Monica works at a retro diner, the writers have her dance to "Y.M.C.A." coming out of a mini jukebox.

The mixtape, which mattered enormously to the growth of hip-hop, is another example. Sampling other songs is the most common technique in hip-hop production. In principle, an artist rapping over a sampled beat ought to pay royalties to the artist sampled. For a long time, though, the music industry turned a blind eye to mixtapes in circulation. An unspoken understanding formed: as long as a mixtape called itself free, it counted as promotion for the artist and was not infringement (even if in practice it was often sold). Had IFPI insisted on royalties for mixtapes while hip-hop was still sprouting, hip-hop would probably never have become the most popular music of today.

Dakou discs, which shaped a whole generation, are the Chinese example. In Western markets, some records and tapes left unsold by overproduction were not fully destroyed when they were disposed of: a notch was simply cut into the CD or the cassette case, which is where dakou — "notched" — got its name. Imported as plastic scrap, these instead became a generation's musical education in China. Terms like "dakou youth" and "the dakou generation" followed. In the 1990s, the musician Zuoxiao Zuzhou once sold a Metallica dakou cassette worth one or two yuan for 120 yuan.

For a time, licensed and pirated music could be said to hold each other up. Piracy gave musicians so much exposure that Bob Dylan went from opposing "unofficial private pressings" to putting out his own official "Bootleg" series. The word bootleg first appeared during Prohibition in America and meant home-distilled liquor, because people often hid whiskey in the legs of their boots; later it came to mean illegally made or privately sold publications. Many demos and concert recordings by the prolific Dylan circulated among fans as bootlegs. At first Dylan detested this unauthorized traffic, but seeing how warmly the market responded, he simply began releasing an official "Bootleg" series himself.

In November, the 14th volume of Dylan's "Bootleg" series comes out. But relations between licensed and pirated music had stopped being "cordial" 20 years earlier. The internet lowered the cost of copying music further: with a computer and a connection, people could get music without spending a cent or leaving home. Growth in which licensed and pirated music propped each other up turned into piracy eating licensed music one-sidedly. In the CD era, piracy at its worst passed a third; IFPI's verdict on the internet was a medium with "a piracy rate of over 100%."

Whatever interesting culture piracy once produced, at bottom it does nothing but discourage creators and damage the health of the industry. As piracy grew more rampant, the music market naturally shrank. By 2000, the piracy business had doubled from 1992, to $4.2 billion. Starting in 2002, global music industry revenue fell for 10 years running.

On the internet, that fertile ground for piracy, the file-sharing site Napster was the emblem of the pirates. It was founded in June 1999 by Sean Parker, a 20-year-old college student, along with two others his age (Parker later became a Facebook investor and its first president). A user searched for a song title and Napster downloaded the MP3 from someone else's personal computer. Users could download and share songs and albums online. A CD that cost $14 could be had here for nothing.

In its first year alone, Napster picked up more than 10 million users. At its peak it had over 25 million users and a library of 80 million songs.

Beyond Napster came a wave of P2P imitators, LimeWire among them. The record labels joined forces to sue Napster and won in the end, but piracy still hit the music market hard, dragging global recorded-music revenue from $25.2 billion in 1999 down to $15.8 billion in 2009.

In those hard years for the industry, copyright stopped being an internal industry matter and became everyone's business. In the early 2000s, tens of thousands of Americans were accused of illegal downloading. There are two figures in circulation, 180,000 and 350,000, and either way the scale was enormous.

China's record industry, which had never had deep foundations or much awareness of copyright, collapsed harder than America's. In the first decade of this century, people could easily find MP3 files of music through Baidu and load them onto a player. Because the supply of MP3s was so vast, Baidu even launched a dedicated MP3 search.

Labels and musicians alike went to court to make Baidu pay for infringement. Gao Xiaosong once denounced Baidu on Weibo: "Baidu is the music world's most hated enemy, the world's largest fence for pirated music, a shameless merchant who sells ads and makes money off stolen music, a bloodsucker that enslaves musicians." Many of the suits ended with courts ruling that Baidu had infringed, but the damage done to the record industry could not be undone, and for a long time people had no notion of copyright at all: music, they believed, was supposed to be free.

IFPI wrote in 2008 China Recording Industry Data: "Despite its large share of the overall market, China accounts for only 1% of the global digital music market's value," and "the spread of online piracy has become the biggest obstacle to the growth of China's online music market. More than 99% of music downloads in China are illegal."

Just as Napster was flourishing, iTunes was seen as piracy's natural enemy. iTunes arrived on April 28, 2003, and together with the iPod it opened the era of the 99-cent single. One nice detail: when the iPod first appeared, the plastic film on its screen read "Don't steal music."

In its first week, iTunes logged more than a million song downloads. Before long, music was selling better on iTunes than at offline stores like Best Buy and Walmart. In its first year it sold nearly 70 million singles.

iTunes started out with digital rights management (DRM) protection that kept files from being copied or shared. It dropped DRM in 2009, though the music still carried digital watermarks that identified the buyer.

Yet even while iTunes led the way for licensed music, piracy stayed widespread. IFPI estimated that in 2008, 95% of the music downloaded worldwide was pirated.

Then music entered the streaming era, and listening online became the newest way to consume it. Spotify now has 180 million monthly active users in 65 countries. Its paying subscribers grew from 15 million in January 2015 to 83 million this January. Apple Music's subscribers went from 6.5 million in October 2015 to 50 million this May.

Streaming was treated as one more hope for ending piracy. It took iTunes's logic of selling licensed music cheap a step further and gave licensed music away free. Streaming platforms also had a firmer grip on copyright: only paying members could download songs to a device.

Streaming finally put copyright in China's music industry on the right track. The turning point came in 2015, when the National Copyright Administration issued what was called the strictest copyright order in history. In under two months, music sites took down more than 2.2 million unauthorized tracks. In the streaming era the map became clear — the active players were no more than a handful of big companies, NetEase Cloud Music, Xiami Music, Tencent Music Entertainment Group and Baidu Music — which also gave the policy concrete targets to enforce against. In 2017, China's music market entered the world's top 10 for the first time.

The industry has shown signs of recovery again. IFPI data show the global music industry growing for three years running. Streaming brought in $6.6 billion in 2017, 38% of total revenue, ahead of physical formats' 30% — the first time streaming was the single largest source of revenue.

As iTunes once paired with the iPod, streaming and the phone are the new music combination. IFPI data show that 75% of consumers listen to music on their phones. The absolute time spent listening on a phone is not large — 27% of all listening happens there — but 58% of 16-to-24-year-olds say that if they could pick only one device to listen on, it would be the phone.

Piracy, though, shows no sign of being wiped out. Free online listening is not enough; people also want to keep music on their own devices, which is where ripping comes in.

Ripping is not so different from the way people dubbed cassettes on tape recorders or burned CDs decades ago. It holds the music industry back: ripping sites usually make their money from ads and pay nothing to labels or artists. Many users do not realize that ripping is piracy — in a 2016 MusicWatch survey, 73% of those who admitted ripping thought the practice was legal.

In 2016, the record labels took YouTube-mp3.org, one of the largest ripping sites, to court. According to Universal, Sony and Warner, the site had millions of users and handled 40% of the world's ripping. It was ordered to shut down.

The familiar standoff between licensed and pirated music from the CD and internet eras is being replayed in the streaming era. It may be telling us something there is no way around: piracy has not been wiped out, and it cannot be.

Cover image: Unsplash