Kauffman Entrepreneurial Year and Piracy

I'm going to try to start writing more.

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Two months ago, I was admitted to the KEY (Kauffman Entrepreneurial Year) program at the University of Rochester. The KEY Program is one of several "Fifth Year" programs at the UR; it gives students a free extra year of school to pursue some kind of entrepreneurial endeavor. My proposal was originally to apply the open source model to music. The main ideas behind it were that that music should be free to share and remix; the artists would be compensated by donation. However, as I started to extrapolate this idea, it became obvious to me that, while this was a decent starting place, I needed to shift my focus slightly to directly address more important issues to me and to musicians.

Let's consider piracy.

It's likely that every relatively popular album ends up on some peer-to-peer network for free, illegal download. Want proof? Try typing any album title into The Pirate Bay's or isoHunt's search bars. I guarantee you'll find just about anything. This can be problematic for artists who want to make money.

To give you an idea of how problematic it really is, illegal peer-to-peer file sharing is estimated to account for about a fifth of the bandwidth in the US. That is enormous. And unstoppable. For comparison, Facebook and Google combined consume 15% of US bandwidth. The lawyers--and the suits that hired them--who think that a few lawsuits or even a few thousand lawsuits are going to stop it are dead wrong.

These are distributed networks, meaning that there are no centralized servers that hold the data. Sure, websites like The Pirate Bay and isoHunt host an index and tracker which make it easier to find peers, but that's not where the infringing material is. These networks have more traffic than Google and Facebook combined, and, to top it off, all of the illegal material is stored by individual users across the globe. Unstoppable.

So, if these peer-to-peer networks are so enormous, why are people attempting to shut them down? Why bother? Because the big record companies are stuck in their pre-internet heyday, a time before individuals had such power. The companies are large and once enjoyed enormous success. As in any market, adaptation is crucial to survival, but they won't budge. Nevertheless, we carry on, slowly leaving them in the dust of their pre-internet reign.

So, what now? How will anyone ever make money again? This is where my KEY project has lead me. Imagine a world where peer-to-peer sharing is legal because artists intentionally put a copy their music online for free. And imagine that fans can easily donate to their favorite artists, potentially in exchange for cool gifts or prizes. This is where I'm headed.

You might ask, Won't this lead to anarchy and chaos, people just taking the free music without giving? I don't think so. First of all, peer-to-peer file sharing has gotten pretty easy, but will never be as easy as iTunes. Many people value simplicity enough to pay for the music; they don't want the hassle. On the flip side, the people who are pirating music are more generous than you think. Through some preliminary research, I've found that most people who currently use peer-to-peer file sharing to get music for free would definitely give money to artists, especially in exchange for creative gifts. Many of them said that if this were available, they would spend more money on music than they do now.

My project isn't about turning the music industry on it's head or fighting the pirates. This is about taking advantage of the most resilient and powerful networks in the world to put money into the hands of the musicians. The goal isn’t to make it easier for people to get free music, it’s to make it easier for people who get free music to give back to the artists. VODO has already proved this model to be successful for film. The world needs a way for musicians to monetize their music that would otherwise be given away. This is it.