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Duchene, Anne; Waelbroeck, Patrick --- "Peer-to-peer, piracy and the copyright law: implications for consumers and artists" [2005] ELECD 90; in Takeyama, N. Lisa; Gordon, J. Wendy; Towse, Ruth (eds), "Developments in the Economics of Copyright" (Edward Elgar Publishing, 2005)

Book Title: Developments in the Economics of Copyright

Editor(s): Takeyama, N. Lisa; Gordon, J. Wendy; Towse, Ruth

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781843769309

Section: Chapter 4

Section Title: Peer-to-peer, piracy and the copyright law: implications for consumers and artists

Author(s): Duchene, Anne; Waelbroeck, Patrick

Number of pages: 20

Extract:

4. Peer-to-peer, piracy and the
copyright law: implications for
consumers and artists
Anne Duchêne and Patrick Waelbroeck

4.1 INTRODUCTION

Many voices in the music industry claim that Internet piracy has reduced
sales of original CDs and that illegal MP3 files have become a substitute to
legal CD purchases. Different from for-profit piracy, end-user piracy seems
to be much more difficult to control. The industry and policymakers have
addressed the issue by reinforcing the copyright law, by implementing tech-
nological protection and by actively enforcing legal protection through
lawsuits targeted at developers and users of peer-to-peer (P2P) networks.
On the other side of the field, advocates of online distribution technologies
have argued that MP3 downloads offer a new way for consumers to try out
new music, a typical experience good, in order to make more informed pur-
chases, which could eventually boost CD sales. The goal of this chapter is
to analyse the effect of increasing copyright protection on the pricing and
protection strategies of the firms and its consequence on consumer surplus.
We consider two distribution technologies that differ as to how consumers
acquire information on new music. Before the formal presentation of the
model, we start by an overview of legal and technological aspects of digital
music distribution and a non-technical summary of our main findings.


4.2 TECHNOLOGICAL AND LEGAL ASPECTS OF
INTERNET PIRACY
Digital Music Distribution

Two technologies are currently used to download music files and to listen
...