Can Digital Sharing Sell Music?

By now everyone is familiar with the RIAA and their collective belief that everyone online is a thief, stealing music every which way we can. The recording industry has been fighting to prove that even the premise of “making available,” putting music out there to share with no proof it's ever been downloaded, is still a violation of copyright laws, and that all the digital sharing results in nothing but losses for the music industry.

The Web 2.0 music sites beg to disagree. Last.fm, which just launched its free version in January, claims that music sales have climbed 119% for its partners, with users purchasing 66% more albums and singles than they did before launching the free service, with the amount of time users spend on the site increasing as well (188%).

iLike saw similar results quantified for them back in February with a release of a study from The Wharton School that showed that long-term iLIke users added almost 250% more music per month to their libraries.

So who's right?

As a user of both apps, I'm falling on the side of the Web 2.0 music companies. What the record industry fails to understand is how much their old model has degraded. With corporate media conglomerates like Clear Channel spoonfeeding the music to the public, the number of acts that anyone ever gets to hear is greatly reduced. What sharing allows is an easy way to discover music you might not have heard otherwise.

The recording industry still revolves around the same premise: develop acts, have one hit big, and make a pot of money that supports everything else and their big cars, much like venture capital. They fail to look at companies like Amazon who make money on the Long Tail; how many more sales would the recording industry make if they embraced the “try before you buy” mentality and put more music out there for people to find.

iTunes is always held up as proof that people will pay for digital downloads if you make it easy for them. Services that recommend music based on user preferences and past likes don't just make it easy to buy music (most link back to online stores like iTunes and Amazon), but also to find music you like and see if it's something you like enough to purchase. A preview of a few seconds isn't enough, and hearing one song played incessantly on the radio doesn't push an album.

I can't be the only person who buys tons of new music I discover through online suggestions, can I?