Every musician I know says this. Back in the day, you could actually make money selling records, which led to a flourishing of music. New hopefuls would work their butts off, playing gigs and selling small-print-run CDs to make ends meet while they waited and hoped for a major label to give them their big break. And they really had a shot at a big break, too.
Then file sharing happened, and if you were any good your stuff was being pirated as soon as it was released, if not before. Major labels won't touch pirated stuff, it's radioactive. The only way to make it is to take a bath on record sales and hope that enough people buy concert tickets and swag to meet your expenses. So yeah, the likes of Taylor Swift, Katy Perry, Justin Bieber, Drake -- they all get rich, but everybody else is struggling.
The idea that piracy helps listeners discover new music may well be true. But it doesn't help put food on musicians' tables -- just the opposite. See also: open source and the corrosive effect it's had on programmers' livelihoods.
This is so wrong it's fully in Poe's Law territory.
Musicians at no point have made a majority of their money from album sales. To make any money off an album most bands need to sell tens of thousands of records. Most records never sell anywhere close to that number.
Record labels are basically loan companies. They sign a band on a contract for X number of albums. The royalties of those albums is then divided up among the label, the song writer(s), often the engineers and producers, and then the actual performers on the recording. A majority of the royalties are kept by the labels with the rest divided up among everyone else.
For signing this contract the artist is often given an advance. The label will also front money for studio time, recordings, and promotional work. Most of that fronted money the artist owes to the label so they start in arrears. When an album is purchased the label keeps the artist's royalties until their advance and other "recoupables" are paid back. It's only then an artist actually makes money off their album sales. The only ones that even begin to see money from album sales are ones that manage many tens of thousands of sales. Most artists never sell enough albums to pay back their advance.
Amortized over time an advance for a record for most artists is pretty paltry. In order to make a living with music they need to tour or luck out with a licensing deal.
The money for artists has always been in touring. They get a cut of ticket sales and keep their profit made off selling merch. But like with everything else it's the megastar acts that make most of the money. Many artists make barely above minimum wage on tour.
Music piracy has not really changed the calculus at all. Most musicians barely get by playing music. The megastar acts have always been exceedingly rare.
But before Napster, artists could sell more records and had a better chance of getting out of the hole with the record company.
After Napster, not so much. And again, record companies won't touch your work if it's already out there on the internet.
I used to work with people who tried to make it in the Boston music scene. They say it was great in the 90s because the scene was thriving. Then file sharing happened, killed the scene, and made it more difficult for musicians to make a living.
Your Boston music scene friends are making a fundamental attribution error. They're blaming file sharing for the "scene" changing from factors entirely unrelated to file sharing.
1) In the 90s "record" sales were anomalously high. Record companies not only published new music CDs but republished fifty years of back catalogs either in compilations or CD reissues of albums that had long been out of print.
2) Movie soundtrack albums became big business. The 90s saw dozens of movie soundtracks go multi-platinum and many many more go gold. That was mostly unheard of in decades past.
3) Retail chains leaned into CD sales, some like Best Buy selling them near cost at times to pull in halo sales of other products. Specialty retail chains also grew during this time.
4) Malls as retail hubs also exploded during this time putting record stores in easy reach of more people.
5) Consolidation in FM radio and "format" stations massively increased the reach of label promoters. No longer did they need to deal with thousands of individual DJs, they could just don't-call-it-Payola-but-it-still-was promote stuff to programming directors and it would get on the air in a hundred markets.
6) CDs being much cheaper to manufacture allowed more independent labels to actually manufacture records for sale. Smaller labels serving niche genres were able to get in more records manufactured for sale.
7) Music got much cheaper to actually record and produce DAWs that just got cheaper and more capable. By the end of the decade you could record an album in a living room or garage and it could sound really good.
8) CD players became incredibly cheap and omnipresent. Every PC, portable stereo, car, and most game consoles (save Nintendo) ended up with built-in CD players.
All of these factors combined to form a massive sales bubble around CDs. It peaked around 2000 mostly because the anomalous sales of back catalog stuff reached a saturation point. It didn't totally burst because there was still a long tail of niche music being sold alongside megahits.
The sales of CDs dropped as sales through services like iTunes increased. Then further with streaming services.
While file sharing got a lot of attention it actually had a very small effect on music industry financials. Music buyers still bought music. The CD bubble burst because the back catalog sales had reached saturation.
The music scene changing in Boston or elsewhere after 2000 is more related to economic trends. Record chains overextended themselves and went out of business, they thought CD sales would continue forever. Chains like Best Buy, Walmart, and B&N ate their lunch because they could sell CDs cheaper. They could price CDs lower because they made their nut on other products. Music was just another thing to get people in the door. Apple and Amazon put the hurt on those chains with online sales.
Pretending every downloaded track on Napster was a "lost" CD sale is record label propaganda. They sell it to musicians so they blame evil pirates for picking their pockets so they don't notice the label's hands in there.
Then file sharing happened, and if you were any good your stuff was being pirated as soon as it was released, if not before. Major labels won't touch pirated stuff, it's radioactive. The only way to make it is to take a bath on record sales and hope that enough people buy concert tickets and swag to meet your expenses. So yeah, the likes of Taylor Swift, Katy Perry, Justin Bieber, Drake -- they all get rich, but everybody else is struggling.
The idea that piracy helps listeners discover new music may well be true. But it doesn't help put food on musicians' tables -- just the opposite. See also: open source and the corrosive effect it's had on programmers' livelihoods.