Google and the arts: patron or thief?

A few days ago Britain's Daily Mail published a sensational, centre-page spread under the headline "Google threatens to destroy not only pop sensation Adele, but Britain's film and music industries. So why is No.10 in thrall to this parasitic monster?"

A couple of days later The Guardian replied with "YouTube NextUp scheme to back UK digital talent".  This is a story about how Google is investing €500,000 (£441,000) in nurturing young artists.  So, who is telling the truth?  Is Google a latter-day Medici family, offering patronage for art and then showcasing it on Youtube?  Or is it "a giant vacuum cleaner parasitically sucking up content from media companies, publishers, film makers and musicians without paying anything back into the creative process?"

First of all, it has to said that the Mail's Business Editor seems to have a problem with the whole 'internet thing', a point made repeatedly by online contributors in the paper's comment section.  According to this argument, the music industry's current problems began with the growth of the web in the 1990s, and all of its woes (falling album sales, digital piracy, high street shops closing) stem from that era.  Therefore it follows that the internet caused the problems.  Google is the voice of the internet, so it stands to reason that Google is to blame.

Let's stick to music for now and try and establish the facts.  It's complicated.  Last year in Britain CD sales fell 12%, the 6th year in a row.  But that is largely a structural thing: music is now much more likely to be consumed in a digital form on a portable device: singles (as downloads at least) sold nearly 6% more, with 5.2 million tracks downloaded in the last week of 2010 alone.  People are still buying music, but often don't want the whole album.  In any case, digital versions of complete albums are doing well, up more than 30%.  The problem is that, overall, the rise in digital sales is offset by the decline in physical products.  To make things worse, record labels make far smaller margins on downloads than they used to on CDs sold in the shops.

The big winners in all this are the dowload stores, particularly Apple and Amazon.  the iTunes store had sold more than 10 billion songs this time last year, according to the Guardian, with Amazon catching up quickly.  Now Google is set to enter the download market - no doubt recognizing the revenue possibilities of the seamless link from Apple's iPhones, iPads and iPods into the digital store (smartphones powered by Google's Android operating system are out-selling iPhones by a factor of 3-to-1).

The music industry says that piracy (illegal downloading) is the problem.  The Daily Mail seems to believe that because pirate sites show up in online searches, Google is somehow complicit in the destruction of the creative industries.  Although this clearly misses the point, what about YouTube, bought by Google in 2006?  There is almost nothing downloadable from YouTube into the sort of format you would want to listen to music on: much of what there is has been put there by musicians and record labels in order to publicise their work.  There is a good example below from an up-and-coming Welsh band I have been following.  In this case Google is providing free publicity as well as paying a share of the advertising revenue to the production company which made the film.

Google wants a share of Apple's download business, and Amazon's.  It wants to make YouTube a more broadly-based entertainment channel with live sports, entertainment and music.  It does not engage in piracy or condone it.  The fact that it is willing to provide funds for young artists to develop their talent should be encouraged.

Digital piracy is a serious problem, and as we have noted, a complicated one. There are no easy answers, but I will attempt to identify some of the questions in a later post.