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Postmarket Effects of Intellectual Monopoly

By Per Bylund, who said in a Facebook post that with this article he “came out of the closet.” Good. Another member added to the libertarian IP awakening. (See my article The Death Throes of Pro-IP Libertarianism.)

Archived comments below.

Postmarket Effects of Intellectual Monopoly

Mises Daily: Tuesday, December 20, 2011 by

 

I readily admit that I am a sucker for glam (or hair) metal to supplement my voluminous consumption of heavy metal. Unfortunately, the heyday of glam metal is long gone and what remains of this proud musical genre is the occasional but temporary reunion of long-since-retired band members for another last gig or tour. While the genre saw something of a revival (or nostalgia) in the past decade, whatever was accomplished is far from the good old days.

Yet this is not the impression one gets from visiting online stores such as Amazon.com. I recently did so in a quest to increase my collection of glam-metal albums on my hard drive, and what I found was a strange phenomenon: many of the great old albums sell at very high prices. Not only that, but they sell at substantially higher prices if one chooses to download the files than if one orders the physical CDs.

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Archived comments:

Comments (20)

+2

Jake's avatar

Jake· 30 weeks ago

The warrent album you are refferencing, dirty rotten stinking…was released in 1989 not 1984.

I like the article by the way.

Jake

2 replies · active 30 weeks ago

+2
bylund's avatar - Go to profile

bylund37p· 30 weeks ago

You’re right Jake – my mistake. It was released in 1989.
+1

Daniel Hewitt's avatar

Daniel Hewitt· 30 weeks ago

Freudian slip. You were thinking of Van Halen’s 1984? That one was a classic too.

Ah, good times.

I think you’re overlooking a major competitor in the downloadable music game. “Piracy.” The cost of downloadable music is now $0.00.

4 replies · active 30 weeks ago

+7
bylund's avatar - Go to profile

bylund37p· 30 weeks ago

Not overlooking, stillbjorn. Free downloadable music is not an economic good to the degree it is truly free. And to the degree it can be considered being available for a very small cost, it should have a highly reducing effect on *legal* downloadable music, wouldn’t it? This but makes my case stronger, since the high prices for downloadable music make even less sense.
0

Joshua Gonzales's avatar

Joshua Gonzales· 30 weeks ago

Per,

I would not say that the illegally downloaded music is totally free. There is the opportunity cost of bandwidth is one consideration. Another would be a selection amongst the various hosts with what seems to be identical content (i.e. the same Dokken album) with some uncertainty about the quality of the file or even the authenticity.

Now I do agree with what you go on to say and that is that the existence of P2P or torrent networks which have no cost other than the ones I describe above, would in a unregulated market, drag down the price of a download from a site like amazon. However, do you think that in that market there is still a place for those who would charge some money price for downloads? They would offer safety, security and authenticity to their customers in exchange for a small (much smaller) fee.

+4
bylund's avatar - Go to profile

bylund37p· 30 weeks ago

Joshua, I am not sure what you are saying that I am saying. If you re-read my comment, you will notice that I do not say that “illegally downloaded” music is free. In fact, I state that it can be considered downloadable “for a very small cost.” So I am not sure to what you are reacting – to my statement that a completely free good is not an economic good?

As for the rest of your comment (which I do understand), I do think that there is a market for downloadable music for a (small) fee. I’m not sure exactly how the market would offer this product in a freed market, but it is possible that downloadable music is bundled with discounts, VIP status (or something like that) that is somehow offering value in the purchase of new music, apparel, or whatever. Amazon is doing this small-scale as it is, since they – as I mention in the article – offer download credits if you buy the album (which comes at something like half the cost of downloading the same songs!).

Most of the income for record labels (and artists) is through radio, merchandise, and tours anyway. Perhaps music would be seen as part of an artist’s marketing mix in a freed market? Let’s hope we will find out in time.

-6

wildberry's avatar

wildberry· 30 weeks ago

Per,
Your economics is a littel one-sided, and you seem to have a misunderstanding of the operation of property rights and the difference between the interests of the consumer, the artist, and the copyright holder (which may be three different people).The failure of the market here is to figure out a business model to give consumers what they want, rather than force them to buy something they don’t want (the whole album) to get what they want (a song).

Also, artists sell their copyrights to others, who have a right to protect their property rights,but often in ways that are not helpful to artists or consumers. Artists have now have the right, and do offer their work for free. Nothing in copyrights prevents that from happening today.

Your real problem is that your favorite artists sold their rights to some corporation, who is holding your musical preferences hostange, thereby encouraging “pirate” operations.

btw, you could check out my epic heavy metal band at http://sorcerer.bandcamp.com 🙂 Two albums at a really bargain price.
0

bgm's avatar

bgm· 30 weeks ago

The fact is that where the glam rock bands made their profits back in the day is different from where the modern superstars make their bucks. Glam rock existed in a golden age of music. This was the 60 years or so spanning roughly from the early 50’s (really taking off around The Beatles era) to the end of the 90s Britpop scene. Anyone who was lucky enough to release records in that time (artists and labels alike) would on average have made a large proportion of profits from record sales. This golden age was a freak occurrence. Before this most music was sold as sheet music and could be easily replicated and passed on through public conscience. After this time the digitization of music coupled with the spread of technology enabled a similar thing to occur bringing an end to the good times when you could sell a piece of plastic for a hugely inflated price through the magic of marketing and supplying in demand products to the market.

Modern super stars now make their cash on live touring, merchandise, media deals, publishing etc. The music they sell is simply an advert for this and the money they make selling CD’s and downloads is minimal in comparison. The reason GaGa will sell music either atomic release or digital for an inflated price is to give it some sort of credibility through price which is what we use as a method for gauging quality these days. Also the distributors know full well that they can’t make the sort of profits they used to with any artist so this has a factor in setting the price but is not the only factor. The fact that a new release will quickly be re distributed for free has been turned into an advantage.

I also suspect that the reason we are starting to see bands reforming is to take advantage of the live scene in the same way. However as their market is more lightly to be loyal fans who are prepared to spend money on re stocking their collections along with the fact that the money has already been spent on creating the recordings and creating an image. It is now easier to justify selling hard copies of albums at a lower price as the cost of pressing CDs is very low in comparison to the cost of creating a new work from scratch. This could also be seen as an incentive to buy tickets to a future gig as if you are willing to take the risk on buying a reissued CD you are then more lightly to follow-up your investment with a ticket to their Gig.

Thanks for the thought provoking article.

+2

macsnafu's avatar

macsnafu· 30 weeks ago

I’m not sure that entirely explains the aftermarket. In my own case, for example, I’m not a glam metal fan, but of the artists you mentioned, three of them have particular songs I’m interested in and want to have as mp3 files. For one of them, though, I found a used vinyl copy cheap and recorded and converted the song to an mp3 on my computer. As far as I know, the other artists don’t have songs I’m interested in, and thus, I’m not looking for their songs. Of course, I could just buy the individual songs for download, instead of the whole album, and I suppose that creates a different demand dynamic.
0

Friedrich's avatar

Friedrich· 30 weeks ago

The other week, a friend of mine intended to download the Bjork-Track Army of Me from the Sucker Punch movie (that movie sucked big time btw). Funny thing was, that it was only possible to download that song if you bought the entire album 0_o

That said, searching or a viable download reduced his cost to get the track to zero eventually. Contentmafia screwed up big time, I think, especially as he got access to tons of other desirable downloads for free that way.

0

heathroi's avatar

heathroi· 30 weeks ago

It’s more of a time preference issue i suspect. But also your argument has a fault in that you are comparing an industry which has copyright protection against one that does not. For instance. if copyright had ended on a arbitrary day say 1/1/2000 then yes you could get all the “cherry pie” by warrant you wanted but only on the cheapest media available
The vinyl or Cd versions are going to be much pricer. also (possibly a good thing) there wouldn’t be Lady Gaga Album produced like it is currently on a shelf or server. In fact i would go as far as to say the studio album would be extremely rare without copyright simply because who would go into the studio for six months or so with all the production, missing out on touring income when the record company (if such a thing existed)is not advancing you cash
I woulod i like to point out that I would like to see copyright cease as it would be a lot more innovative, just that it would be very different. than the higher or lower cost case suggested by the author.
“Ici, nous sommes maintenant, nous divertir.”
0

Beefcake the Mighty's avatar

Beefcake the Mighty· 30 weeks ago

First of all, glam metal sucks out the ass. Warrant, say, will never be as good as GWAR! or Ministry.

Second, where’s Kinsella been? Has he suffered the same fate as Tucker?

3 replies · active 30 weeks ago

0

wildberry's avatar

wildberry· 30 weeks ago

Yes, I noticed the change. What’s going on here? Lot’s of pleas for financial support, and not much action.
What gives?
0

Dagnytg's avatar

Dagnytg· 30 weeks ago

Beefcake and Wildberry,

Boy, I can’t think of two people more juxtaposed but then you’re the only two left that have laid down some prose on this site so you at least know what I’m talking about.

You can read my rant about Tucker here: http://blog.mises.org/19375/jeff-tucker-on-occupy…

Beefcake… your Yagoda and Yezhov reference is so apropos because it is almost as if Jeffrey never existed at LvMI.

So where is Jeffrey? At the Cato Institute or the Independent Institute…maybe working for the Ron Paul campaign? Nooooo…he’s in the Siberia of libertarian websites. He’s slaving away (literally…he’s been cranking out an article a day most weeks) for Agora Financial whose business model is to get your email address and spam you with investment/trading newsletters. (I made the mistake of joining the Daily Reckoning back in 03.) Poor Jeff gets about 5-8 comments per article of which 2-3 are contrived responses from trading websites. The situation would be comical if it wasn’t so pathetic.

Where’s Kinsella? His last post was October 30th. (Tucker’s November 3rd) Is it coincidence? Maybe he’s on vacation or maybe he died (and like Jeffrey Tucker, LvMI doesn’t think it’s worth mentioning).

All I know is Kinsella (like Tucker) was passionate about this site and posted articles and commented on other threads almost daily…and then…nothing…it’s like he never existed.

Then there is S.M. Oliva…he disappeared before Tucker and Kinsella.

So Wildberry …the days of long debates with Kinsella are over. Furthermore, without the email alerts (discontinued around the time Jeffrey disappeared) your long debates with Peter Surda are over…unless you want to click back twenty blog pages (and counting) everyday and find the post. Hell, without email updates I can’t even follow the discussion. (To add insult, I don’t even get email updates from IntenseDebate.)

There’s not much left on this site. They lost their most passionate thinkers and writers. They lost most of their passionate bloggers (when they discontinued the ability to follow and reply to comments). The IntenseDebate format sucks. They’re begging for writers (apparently, top libertarian and economic writers don’t want to contribute anymore). And you wonder why they’re begging for money?

Note to Lew: Read Mises…the part about consumers voting with their money…

0

wildberry's avatar

wildberry· 30 weeks ago

Well, it was a pretty good run. At this point, it seems unlikely anyone who know is going to say what’s up. I expect the site to continue to decline, as the constant pleas for support instead of original articles from familiar pens has all but stopped, and folks like me don’t have anyone to argue with. No disrespect to those who are trying to contribute, like dear ole Per here, but well, meh.
Timing is good for me, because I have my head down on something important through Feb, but by then, Mises.org will be but a cyber-whisper, it appears.
Even Surda, who always insists on the last word on every subject, has been absent. Imagine!
0

Dokken's avatar

Dokken· 30 weeks ago

Here are some resources for glam/hair metal fans: http://theglamnationnetwork.com/

At http://www.live365.com: genres -> metal -> glam or pop metal/hair

Although this is a pay site, if you go to the page for each broadcaster, most have outside websites and some of them offer free listening.

Enjoy.

0

Anthony's avatar

Anthony· 30 weeks ago

Mr.Bylund don’t download from Amazon their sound quality sucks. Just go to MP3Raid.com its free and the quality is good also you can buy full albums there for $0.99. MP3Raid also lets you you preview the full song and not just a snippet.
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