This is just lovely - the RIAA (Recording Industry Association of America) now just assumes that everyone pirates MP3's so they want to institute a tax on ISP's. What a bunch of swell guys... CANNES, France (Reuters) - A top music executive said on Saturday that telecommunications companies and Internet service providers (ISPs) will be asked to pay up for giving their customers access to free song-swapping sites. The music industry is in a tailspin with global sales of CDs expected to fall six percent in 2003, its fourth consecutive annual decline. A major culprit, industry watchers say, is online piracy. Now, the industry wants to hit the problem at its source -- Internet service providers. "We will hold ISPs more accountable," said Hillary Rosen, chairman and CEO the Recording Industry Association of America (news - web sites) (RIAA), in her keynote speech at the Midem music conference on the French Riviera. "Let's face it. They know there's a lot of demand for broadband simply because of the availability (of file-sharing)," Rosen said. As broadband access in homes has increased across the Western world, so has the activity on file-sharing services. IMPOSSIBLE TO ENFORCE The RIAA is a powerful trade body that has taken a number of file-swapping services, including the now defunct Napster (news - web sites), to court in an effort to shut them down. Rosen suggested one possible scenario for recouping lost sales from online piracy would be to impose a type of fee on ISPs that could be passed on to their customers who frequent these file-swapping services. Mario Mariani, senior vice president of media and access at Tiscali, Europe's third largest ISP, dismissed the notion, calling it impossible to enforce. "The peer-to-peer sites are impossible to fight. In any given network, peer-to-peer traffic is between 30 and 60 percent of total traffic. We technically cannot control such traffic," he said. Rosen's other suggestions for fighting online piracy were more conciliatory. She urged the major music labels, which include Sony Music, Warner Music, EMI, Universal Music and Bertelsmann's BMG, to ease licensing restrictions, develop digital copyright protections for music, and invest more in promoting subscription download services. Pressplay and MusicNet, the online services backed by the majors, plus independent legitimate services such as Britain's Wippit.com, sounded somewhat optimistic about their longterm chances to derail free services such as Kazaa and Morpheus. But they also acknowledged they cannot compete with the "free" players until the labels clear up the licensing morass that keeps new songs from being distributed online for a fee. LEGAL STEP Officials from Pressplay and MusicNet, which are in their second year in operation, declined to disclose how many customers they have. "We haven't really started yet," said Alan McGlade, CEO of MusicNet, when asked about his subscriber base. Michael Bebel, CEO of Pressplay, said his customers tally is in the tens of thousands. He added that the firm, backed by Universal and Sony, could expand into Canada in the first half of the year, its second market after the U.S. He didn't have a timeframe for Europe. Meanwhile, Kazaa and Morpheus claim tens of millions of registered users who download a wide variety of tracks for free. Rosen hailed a recent U.S. court decision which ruled that Kazaa, operated by Australian-based technology firm Sharman Networks, could be tried in America, as an important legal step to halting the activities of file-sharing services. "It's clear to me these companies are profiting to the tune of millions and millions of dollars. They must be held accountable," Rosen said.
When are they going to give up? theres no way of stopping peer-to-peer file sharing, the RIAA makes me mad!!!!
I don't download music from the internet without paying for it (or unless the musician gives permission, like some of the stuff on mp3.com), but I would consider doing so if the RIAA managed to do this. I'm not going to have my ISP pass along the tax to me and not benefit from it. I probably wouldn't do it a lot, but I certainly wouldn't buy an entire CD for one or two songs.
I have finally found a site that has the mp3 files for the songs on the infamous album, "Machina II: Friends and Enemies of Modern Music" by The Smashing Pumpkins. This was their last album and as a final f*ck you to Virgin records (who Billy felt was not promoting them), he purposely put these tracks on the internet for the fans to download...for free. They are in the process of being burned to a CD now (I hope). I can't wait to listen to it!
RIAA also get a cut on every blank CDR sold. Any guesses on how of that money makes it back to the artists. Not only do I try it before I buy it, I buy it used. I do this on every purchase from the Big 5 recording companies.
Well as a burgeoning musician and someone that just released their first cd I feel compelled to weigh in here. I have been the biggest advocate of file sharing and mp3's and all of that crap forever. Now I find myself in the unique position of being hurt by a practice I have done for years. Well my opinion has not changed one iota. It is incumbent on the artist to change their profiteering methodology. I hope people like my music enough to buy it and help perpetuate my career. It totally sucks that you can jump on Kazaa and grab the song and I wish everyone that downloaded it paid for it. But they didn’t so tough **** Chance. Artists now need to abandon the ‘greater than thou’ attitude and actually get to know their fans. Then maybe the fans will feel a connection and choose to buy the cd’s. They need to up their live performances intensity and make money that way. They need to quit this fight and side with their fans. Personally, I have no idea how I am going to make money if everyone dl’s the tracks. But it is my responsibility to find a way. I can’t rely on how it was done in the past. Imagine the guy that owned the largest manufacturer or wooden wagon wheels in the 1880’s. This dude was jamming. He was making money hand over fist. A few years later some jack invents the horseless carriage and they go with metal spokes and rubber. The technology behind his industry changed. Did he sue the transportation companies? The automakers? The people for getting their product from a different source? IMO, people on the left today feel entitled to things. Artists are, for the most part, on the left. They have whined and b****ed about the technological revolution that changed their industry. But they’ve clung to ‘how it was’ instead of evolving with the technology. This is as true about intellectual property as it is about wagon wheels.
Piracy 'a great idea' 19/01/2003 13:44 - (SA) Cannes, France - Pop sensation Robbie Williams said he believes music piracy, which costs the record industry millions of dollars every year, is a great idea. "I think it's great, really I do. There is nothing no one can do about it. I am sure my record label would hate me saying it, and my manager and my accountants," Williams said on Saturday at the MIDEM music trade fair here. Williams, whose contract with EMI is worth a reported $126m, said he had investigated the issue of music piracy before renegotiating his new deal with the record company last year. "I went and saw all the labels and asked: 'What are you going to do about it?' And I heard a lot of hot air. The heads of the record labels don't know what to do about it." Williams' last album Escapology has sold five million copies since its release on November 18, but EMI is reported to believe it will only make a profit when some 18 million copies are sold. Currently, record companies fear that some 800 million bootlegged records are sold annually, compared with the industry's total legal sales of 2.4 billion discs in 2001. Meanwhile, the industry is also faced with the new challenge of the spread of music that can be downloaded free of charge from the internet. Total sales for the music industry fell by nine percent last year to $30.3 billion. - Sapa-AFP http://www.news24.com/News24/Entertainment/Abroad/0,6119,2-1225-1243_1308870,00.html
Don't lump "the left" in with that. Most of the people who have began file swapping revolution were lefty hackers and rap music pioneers. Not exactly a coalition of conservative white folks. Also, it is the GOP that has recently spearheaded an effort by the RIAA to adopt new policies in Congress towards slapping down file swappers. Funny how the record company execs - mostly liberal democrats - will beg the GOP and moderate Dems for help when their pocketbooks are being squeezed. Many of the pioneers of swapping are the "free everything" crowd that doesn't believe in big business or capitalism. When they say "free market," they literally mean free. They want everyone to just be free and happy. Doesn't exactly sound like a plank on the next Republican Party platform, does it? Anyway, I've long told everyone that it isn't Metallica or The Backstreet Boys or whoever who are getting killed by the file swapping. It is largely a group in the music biz that goes un-heard - the songwriters. They make no money from performance. They don't cash checks for merchandising of their t-shirts. Many of them work for roughly the same amounts of money the average American works for. They aren't stars or celebrities. But, because their celebrity bretheren stand in the spotlight and complain (just like Ewing and his "we make a lot of money but we SPEND a lot of money" idiot cry), we don't stop to think that it might be hurting guys who work for $50K a year instead of artists worth $50 million. File swapping is shrinking the market. Record labels eliminate bands who aren't selling millions of records to focus only on the one's who are. Artists who may have altered the world of music abandon their careers in search of a way to feed their families. The number of bands and artists shrinks so the quality of music shrinks as well. Now, speaking as somone who has been in and around this business for nearly 20 years, I don't blame the musicians but I do think that those who complain are fighting a losing battle. Truth is, technology is something to embrace and an equilibrium will be found eventually. The problem they face is the frustration that the segment of the population most responsible for supporting the industry - 14 to 24-year-olds - is the same group that has embraced file sharing. They have the disposable income that has long driven record sales. Now, they are downloading instead. They industry is seeing is predominant buying public disappear. But, that isn't the fault of the musicians and who can blame them for worrying when they know that the RIAA is the devil. It is a behemoth that needs to come down. I mean, when 5 companies own 99 percent of all popular music distributed throughout the world, that is a BIG problem because market share and commerce overwhelm the creative side of the industry. If you read any books on the RIAA and its development, you'll realize that, for many years, there was a strong and loyal contingent of music lovers who worked at these rercord labels. They truly believed in the success of great music. They lived and died with the development of artists they discovered. They took more pleasure from discovering the next Dylan or Beatles than they did in earning their salray, which, by the way, was usually next to nothing (still is). In the past, an artist would have three or four records to develop his/her style. The result was a fully developed and mature artist and usually some really amazing recordings. Today, you are required to have hits every time out of the box and, as the saying goes, you have 20 years to write the material for your first record and six months to write the material for your second. In short, it's tough to be great when you aren't given time to mature. The bottom line is that the record industry has consistently shot itself in the foot by not developing a good stable of artists and adjusting to the changes that have come its way. As a result, they end up with clones of every popular band and you get airwaves full of boy bands or divas or alternative funk rock. The industry has gotten bloated and, like most big bloated industries, it would rather spend money on attornies and lobbyists than be forced to change the way they operate. File sharing is a revolution in music. I don't always agree with it, especially when, as Chance pointed out, it comes at the defecit of the artist, but it is the reality and, if you are a musician, you ignore it at your own peril.
I don't think that this is true. At the peak of Napster, record sales were also at their peaks. Coincidence? I don't think so. RIAA et al waited until the worl economy was in the tank, to make their case with any traction that file swapping was hurting their business. Studies have shown that 2 out 3 music buyers file swap. Out of those that swap, 1 out 5 buys less music. Thus, the RIAA would like you to belive that 1 out of 15 music buyers are ruining the market. The numbers just don't add up. A case can be made that the used CD market (which I suspect has expanded with the advent of the Internet) is also responsible for market decline. Of course if Ds cost no more than $10 a pop at the mall, we would not be having this conversation.
Fantastic post...I couldn't agree more. A lot of the whining and complaining that RIAA is doing is smoke and mirrors. They are doing it for 3 reasons: 1. To justify increased CD prices. 2. To be able to institute lawsuits in the hopes of generating extra cash. 3. To justify passing along less money to the artists, using a "File sharing did this to 'us'" line. All of this while there is NO real evidence that the decrease in CD sales is related to anything other than the price of CDs and the sluggish economy overall. Jack had to find his proverbial beanstalk...and this time it's file sharing.
I should re-phrase. It is not shrinking sales necessarily, but it is shrinking the roster of artists on record labels. Over the past 5 years, the average number of projects on record labels has decreased by 25 percent. Most labels are saying they are going to ultimately shrink the number of bands and artists signed to development deals (not full record deals which are different) by as much as 40 percent. They are doing it in an effort to take more control over the music released and the methods of distribution. The fewer they sign, the more desperate artists are to get signed and give away whatever they have to. I read an article from an A&R guy recently who said that labels are intentionally shrinking rosters as a direct response to file swapping. By trimming the number they have to pay, they can spend more money on promoting a very few artists, rake it in with them while they are still on their original, horrific contracts and then dump them when their sales have slowed. The money that is lost on file swapping does more to damage labels when it is an artist who has a decent contract because the label is getting fewer points on the record AND the record costs more to make. By eliminating development of young talent and focusing on the bands that either sell a bazillion records or those who sell a ton and then get dropped, they limit their exposure to losses from downloading. As a result, the roster of artists on labels are shrinking and, as a result, we get a smaller range of music. And, given that the music that is normally wide selling is almost always long on cheese and short on talent, consumers ultimately suffer.
On the other hand, if the current companies don't deliver music people want to hear, something is going to come in to fill the void. Whether that be a different, indepedent company or whatever, the consumer need is going to eventually be filled.
Isn't it possible that perhaps the ownership concentration is the real evil here, and that the record companies are masking it by hiding behind the 'file-sharing' alarm. When, per Jeff's numbers, 5 companies own 99% (and I'm not so sure about the independence of those 5 companies), the bazillion dollar contract becomes a reality and squeezes out the new artist. Again, as Jeff points out, even very promising new acts are given very little time to develop. I just don't trust the rallying cry around the 'new independent' being the worst hurt by file-sharing. These guys were the ones being screwed by the record companies in the first place. I guess the record companies really don't like competition in any facet of their business. Again, it seems to me with greater and greater concentrations of ownership in the record companies in general, and media overall, and radio stations opting for syndicated shows and 'tried and true' formats the new artist was already being screwed. On line, and file sharing, at least provided them with and avenue to be heard. The great challenge out there is to create a viable on-line revenue stream. And I agree that the Napsters, and others who tried to profit from the artists' work should be shut down. I just don't see the RIAA as the good guys here. And I don't believe for a minute that developing artists or writers would be better off by giving the restoring the stranglehold the record companies have on music distribution.
Oops... I read the title, and some of the responses and launched into my rant about the record companies. Then I read the articles. I disagree with the across the board tax. But, someone's trying to get rich from the Kazaa's et al when the sole business plan of these companies involves facilitating the pirating music. I would not last long if I ran late night TV adverts selling "how to break into homes for fun and profit" cd's and these companies should be held accountable for what they're doing too. My rant had more to do with disagreeing vehemently with the assertion that file-sharing has anything to do with the quality and diversity of music. Or that writers, and less established artists --those who don't have the clout to negotiate the big buck deals --are the ones who are being hurt here. (At least no more so then they would be in the boardrooms of Mega Records Inc.).
bnb: I totally agree that the concentration of companies is the problem. It is destroying the music industry.
When are they going to give up? theres no way of stopping peer-to-peer file sharing, the RIAA makes me mad!!! They shut down Napster pretty effectively. Say what you want, but that slowed file sharing quite a bit. I don't think that this is true. At the peak of Napster, record sales were also at their peaks. Coincidence? I don't think so. It's absolutely a coincidence. Napster's peak also happened to be the economy's peak. It's not surprising that sales would have been at their highest when the economy was at its best. There's no evidence either way as to the effect of file-swapping on CD sales -- and really, it's irrelevent. The RIAA owns the rights to the music -- like it or not, the artists made that agreement when they contracted out with RIAA. RIAA has every right to protect its copyrights and damn well should be doing so. RIAA is part of a capitalist economy. They can charge whatever they want for CDs. If people continue to buy them, why shouldn't they charge high prices? It's simple supply and demand. There's no moral obligation on them to supply people with cheap music. They've found an effective marketing / business strategy and are using it. Until a competitor arises to offer the artists a better deal, I don't see a problem there. In terms of going after file-swappers, these companies are willfully and purposely assisting in copyright violation (Napster was, at least) and RIAA has every reason to pursue lawsuits against them. As for this particular set of lawsuits, it doesn't look to me like it has any merit and would most likely get thrown out. Maybe MadMax or Refman can give a better analysis of it though.
If the concentration of ownership gives them monopoly powers I disagree. This is my concern. I suspect this line has been crossed, or is close to being crossed. Quite possibly one of the consequences of this gouging strategy is the proliferation of ways around it. I suppose ideally you could say people should just not listen to music if they can't pay up, but that's just not going to happen. The cost of these lawsuits is a cost of implementing their marketing strategy. Agree completely. I am not a fan of illegal file-swaps. But I disagree the RIAA should be given a free reign to just squash anything that interferes with their current business model. I don't know the solution here. And I realize I am very biased by my distaste for the Record Companies.
Of course, the member companies of the RIAA don't seem to see this, either. They charge a price and sell the number of copies that price supports. And then they complain they aren't selling enough CDs. Seems to me that if they want to sell more CDs, perhaps they should lower the price to a level that would result in higher demand for the product. If they are happy with the level of product they sell, then they can keep charging the price they do. I could compare it to DVD vs. Laserdisc. Why do consumers love DVD and didn't care for Laserdisc? It could've just been timing. Consumers weren't ready for laserdisc.... or it could be that consumers weren't interested in the digital movie format until the price point was right. DVDs are cheap. Laserdiscs were expensive. I have no doubt DVDs would not have caught on the way they have if they cost significantly more money. There's more to it, of course, but that's the basic issue.
One thing about business, however, is that you don't just have to cut prices to stay in business. If corporate downsizing has taught us anything, it is that a company can slash payroll and see their stock prices soar. In the case of record companies, it is important to note that the primary 5 companies that control the majority of the industry have music as only one small part of their overall. Think of the Big 5 and what they own: Universal Sony BMG AOL/Time-Warner EMI Some of the companies that are owned by these (or, in the case of Universal, the parent company in France that just bought them) include everything from movie studios and record labels to industrial manufacturing, electronics, water distribution, food, toys, publishing, you name it. Most importantly, they not only own the labels, but the studios, the production facilities, the distribution houses, media outlets that promote the products, etc. etc. They own from the top to the bottom. It skews the market when only 5 companies control virtually every bit of pop music.
