At present, illegal music downloading has become an unstoppable and a widespread activity specifically among the young generation that includes university students that have been discouraged by the legal actions taken by the industry.
The key purpose of this research is to observe the current condition of illegal downloading and the impact of the consumer attitudes and the ethical orientation towards the activity of illegal downloading. The report also aims to provide an understanding about why the consumers choose to download illegally rather than buy music.
1. To examine the relationships between ethical orientation, attitudes towards piracy of MP3s and illegal downloading activities.
2. To investigate the causes of illegal downloading.
3. To investigate the impact of illegal downloading.
4. To determine why the customers are disagreeing to pay for digital music.
5. To investigate the effectiveness of legal consequences on illegal downloading.
Incidence of Digital Music Piracy
Over the last few decades there has been a drastic change in the music industry.
The quick diffusion of fast Internet connection facilitated file sharing and online downloading. According to survey by the Office Of National Statistics, in 2009 over 18 million UK households were using broadband Internet access, this boosted Internet usage among the consumers, which discovered an increased convenience in digital and online purchasing (Palenchar, 2009; Reardon and McCorkle, 2002).
Around half of the people that accessed the Internet prior to this survey had downloaded, legally or illegally, music and movies. The development of the software that allows the free distribution of music has changed the relationship between the supply and the demand chain. Hence, this has increased the problem of illegal downloading: this type of distribution of music is also known as ‘Peer to Peer’ as it allows the consumer to share music with other internet users (A. Dilmperi, 2009). This type of illegal distribution is believed to be responsible for the decline of the music sales (IFPI, 2010): a decade after the launch of Napster and the beginning of the Peer to Peer file sharing, digital music piracy has caused up to $10 billion losses to the worldwide music industry and is believed to be responsible for the decline of physical CD music sales (Mckenzie, 2009; Graham et al, 2004; Lysonski and Durvasula, 2008). Currently, other files sharing networks have emerged and have become popular for free music downloading such as eDonkey, Limewire, Ares, and Bit-Torrent. (Knopper, 2004; Helm, 2005).
The causes of Illegal Downloading:
Piracy is seen as the greatest threat that the music industry is facing, so it is important to understand why some consumers choose to download illegally instead of purchasing music. Research about this matter has focused on the comparison of different consumer groups and on the psychology of decision-making; especially students’ behaviour received a great deal of attention. Most researchers decided to apply the theory of planned behaviour (Ajzen, 1991) in order to study the attitudes towards downloading pirated music.
Research conducted by Cronan and Al-Rafee (2008) indicated that attitudes regarding intellectual property, perceived risk, and previous behaviour, impact the willingness to pirate digital music. A recent IPFI (2010) report asserts that the key motivator for consumers to engage in illegal online downloading of files is the fact that it’s free. This is supported by the economic view that consumers constantly seek value, making price a key factor of consumer dissatisfaction (Yu-Chen et al, 2008). When consumers decide to download illegally ethical codes of conduct are clearly involved in this process.
Ishizuka (2004) found out that according to the 2003 survey, around 83% of young generation considered that downloading the music for free is ethically acceptable whereas 29% of the young generation considered this activity to be wrong suggesting that the generation Y has the recognisable attitudes towards the Internet associated misbehaviours and e-ethics. Specifically, it was established that the Generation Y customers were more liberal towards illegal downloading as they considered that this activity is causing no harm to anyone, on the contrary they consider that they are the victims of the high music prices that have been enforced by the music industry. Hence, in the cyberspace illegal music downloading is considered as the smallest offence (Lysonski & Durvasula, 2008).
According to Ouellet (2007) respect for the artist was the main element for a consumer to prefer legal over illegal networks, valuing their copyright policy. Nowadays the music industry is trying to convey a sense of guilt in the consumers suggesting that innocent singers are losing money when consumers download the music online for free. Researchers have found that social consensus and personal morality have an impact on the consumers ‘decisions to get involved in digital piracy and the possible outcomes of their actions, such as legal prosecution (Chiou et al. 2005). It is possible to say that individuals do not perceive the act as being illegal as a norm has surfaced over constant repetition across the population, therefore they may consider file sharing to be equal as stealing without seeing it as a real criminal offence.
According to La Rose and Kim (2007), prescriptive and descriptive social norms have no direct impact on the consumer behaviour and recent research has suggested that the legal threats discourage the consumers to download illegally together with the personal morality factor (Bellemare and Holmberg, 2010; Chiou et al 2005; Lysonski and Durvasula, 2008). However, it appears that news of famous lawsuits have a short-term effect on deterring the amount of illegal downloading, so it has been established that preventive measures are not able to discourage all the consumers (Bhattacharjee et al. 2003), and instead they might encourage illegal behaviours among other consumers (Levin et al., 2007; Sinha and Mandel, 2008).
The consumers’ individual characteristics also play an important role in decision making. A study conducted in the United States found that race had absolutely no significance in determining the attitudes towards digital music piracy as ‘both white and black groups demonstrated generally equally favourable views toward illegal music downloading’ (Gerlich Et al., 2007). A second study on student’s behaviour in the United States found that generally there were no major gender differences in the attitudes towards illegal downloading although a man’s use of downloaded content was different from a woman’s (Kinnally et al., 2008). In consumer behaviour the effect of gender is a well-researched topic, therefore differences in attitudes are expected between a male and a female (Powell and Ansic, 1997; Richard and Chandra, 2005; Saad and Gill, 2000; Palan, 2002). According to Powell and Ansic (1997) men have a tendency to be more willing to take risks in comparison to women.
Generally different levels of education are believed to have an impact on the downloading behaviour (Childers et al, 2001) as some researchers suggest that income affects the online consumer behaviour (Chittenden and Rettie, 2003; Kim and Kim, 2004; Dennis et al., 2009; Swinyard and Smith, 2003), thus people with a better education background and higher income levels are less likely to engage in digital music piracy than people with lower education and poor economy, as they would seek cheaper ways to obtain digital music.