POINT: RIAA

"Online piracy is the unauthorized uploading of a copyrighted sound recording and making it available to the public, or downloading a sound recording from an Internet site, even if the recording isn't resold. Online piracy may now also include certain uses of "streaming" technologies from the Internet.

Many do not understand the significant negative impact of piracy on the music industry. Though it would appear that record companies are still making their money and that artists are still getting rich, these impressions are mere fallacies. Each sale by a pirate represents a lost legitimate sale, thereby depriving not only the record company of profits, but also the artist, producer, songwriter, publisher, retailer, … and the list goes on. The consumer is the ultimate victim, as pirated product is generally poorly manufactured and does not include the superior sound quality, art work, and insert information included in legitimate product.

Each year, the industry loses about $4.2 billion¹ to piracy worldwide -- "we estimate we lose millions of dollars a day to all forms of piracy."

COUNTERPOINT: BMI

"BMI recorded revenues of more than $728 million for fiscal year 2005, a historic high for our company and the largest performing rights collection of any copyright organization in the world. The figure represents an increase of $56 million, or 8.3%, over the previous year. Royalties available for distribution to songwriters, composers and publishers increased to more than $623 million, up $51 million over last year. Continued streamlining and attention to costs reduced the fiscal operating expense rate from 14.6% to 14.2%, the lowest in BMI's history.
.....
BMI's revenues have grown from $540.8 million in FY 2001 to $728.7 million in FY 2005, an increase of $187.9 million or 34.7%. This remarkable revenue growth over a five-year period is largely attributable to the continuing worldwide demand for BMI's repertoire."

COUNTERPOINT: ASCAP

"Nimbly adapting to the rapidly changing music marketplace with a combination of innovative business strategies and tight cost controls, ASCAP (American Society of Composers, Authors and Publishers) - the 92-year old Performing Rights Organization (PRO) - reported record revenues and royalty payments for 2005.

Revenues for the year exceeded $749 million - an increase of more than $50 million over the prior year - while royalty payments to members topped $645 million. This royalty distribution is a record amount for any PRO globally."

For the uninitiated, the question is this: if piracy is SO bad and harming the industry SO much, how did ASCAP & BMI attain "record" growth???

Photo by M Bilokur.
¹ They totally made this up.