2012 was a big year for music. No, I’m not talking about Adele, Call Me Maybe or the Tupac hologram. The big news this year were the shifts at the intersection of music and technology that occurred as the industry continued to figure out its digital future.
Indeed, the biggest moments in music tech this year all had to do with piracy or the tricky evolution of a business model to replace the one that started dying a decade ago.
1. The Death Of SOPA / Megaupload Raid
These two events were not officially related, but they happened within 24 hours of each other and they both helped frame the debate about content piracy. In late January, the uber-controversial anti-piracy bills called SOPA and PIPA were tabled by the U.S. Congress after massive online protests. The death of SOPA meant the fabric of the Internet would be spared from the wrath of the Recording Industry Association of America (RIAA) and Motion Picture Association of America (MPAA) and set the stage for new legislative battles.
Just as that attempt at fighting piracy ended, an even more dramatic one began when New Zealand police – by request of the U.S. Justice Department – arrested Megaupload founder Kim Dotcom and several of his colleagues in a military-style raid. The hacker group Anonymous responded with large-scale Distributed Denial of Service (DDoS) attacks that took out the Department of Justice’s website. For the first time, the so-called “piracy wars” started to look like an actual war.
The Megaupload raid marked the beginning of a lengthy legal procedure, but it also raised major questions about the rights of non-infringing cyberlocker users and caused similar services to get more serious about fighting piracy, if they didn’t shut themselves down all together.
2. Lars Ulrich Hugs Sean Parker, Embraces Spotify
There could hardly have been a more symbolic official end to the Napster era and more importantly, the beginning of one in which all-you-stream music subscription services are seen as a legitimate way forward for the industry. Metallica drummer Lars Ulrich not only shared a stage with Napster cofounder Sean Parker to announce the band’s arrival on Spotify, he hugged him.
Major questions remain about the viability of Spotify’s business model and whether it can fairly compensate artists, but it’s still early in the game and the fact that Metallica has embraced the model is a positive sign. Don’t hold your breath for The Beatles, though.
3. BitTorrent Goes Legit
2012 was the year the strict association between the word BitTorrent and piracy started to erode. It still has a long way to go, but BitTorrent, Inc. has been aggressively marketing itself as a legitimate content distribution platform and teaming up with established artists and authors to prove it.
Author Tim Ferriss may be the most high-profile content producer to partner with Bit Torrent, but musicians have been experimenting with the platform as well. After Pretty Lights published a bundle of free music and videos on BitTorrent, it soared to the top of Pirate Bay’s download chart, the DJ saw a 700% increase in traffic to his website, collected 100,000 email addresses and, probably not coincidentally, sold out two concerts at the Red Rocks amphitheater in Colorado. For musicians, BitTorrent may provide an unexpected path to revenue.
4. Internet Radio Fairness Act Introduced
Internet radio providers like Pandora and iHeartRadio are expensive to operate. That’s largely because these companies operate under a different royalty rate regime than terrestrial and satellite radio stations, both of which pay far less than Pandora to copyright holders.
In September, a bill called the Internet Radio Fairness Act (IRFA) was introduced in the U.S. House of Representatives that aimed to level the playing field. Record labels, royalty collection organizations and some artists were less than thrilled with the IRFA. Congressional testimony and debate got underway in November and the issue is expected to continue to be a contentious one in 2013.
Whatever happens with the IRFA as it was originally drafted (many predict its demise), something needs to give, and that something will have to balance the need for innovation with the rights of those who create music for a living. The end result of the debate that kicked off in 2012 will have a huge impact on radio’s future.
5. Amanda Palmer’s Blockbuster Crowdfunding Experiment
2012 was the year that independent musicians, desperate for a new business model, started taking the crowdfunding craze seriously. In an age when revenue is harder and harder to come by for musicians, many turned to fans to help fund the recording of their album, production of music videos and other projects.
There were plenty of successful campaigns, but none got more attention than that of Amanda Palmer. The singer took to Kickstarter to fund the release of her album and ended up blowing past the $100,000 goal to rake in more than $1.1 million. Suddenly, crowdfunding looked like a viable model for musicians.
The Amanda Palmer example is not without its caveats, though. For one, not all independent artists will have a fan base as rabid as the famously social media-savvy Palmer. About half of all music-related Kickstarter projects fail to reach their goal. For the right projects and artists, though, crowdfunding can work quite well, as Palmer demonstrated.
Any artists that do luck out on Kickstarter might want to do their best to avoid the public relations headache incurred by Palmer after she invited unpaid musicians to play with her onstage – and was subsequently lambasted across the Web.
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