Music Industry Sends Warning to Song Swappers

Reuters ^ | April 29, 2003 | Sue Zeidler

[Mister Magoo]

Wednesday April 30, 3:06 AM Music Industry Sends Warning to Song Swappers By Sue Zeidler

LOS ANGELES (Reuters) - The record industry opened a new front in its war against online piracy on Tuesday by surprising hundreds of thousands of Internet song swappers with an instant message warning that they could be "easily" identified and face "legal penalties."

About 200,000 users of the Grokster and Kazaa file-sharing services received the warning notice on Tuesday and at least one million will be getting the message within a week, according to music industry officials.

The copyright infringement warnings, which were sent by the Recording Industry Association of America, on behalf of the major record labels, said in part:

"It appears that you are offering copyrighted music to others from your computer. ...When you break the law, you risk legal penalties. There is a simple way to avoid that risk: DON'T STEAL MUSIC, either by offering it to others to copy or downloading it on a 'file-sharing' system like this. When you offer music on these systems, you are not anonymous and you can easily be identified."

The music industry's campaign for the hearts and minds of Internet song swappers comes four days after a federal judge threw an unexpected roadblock to its efforts to shut down song-swapping services in court.

U.S. District Court Judge Stephen Wilson on Friday ruled that the Grokster and Morpheus services should not be shut down because they cannot control what is traded over their systems. Like a videocassette recorder, the software in question could be used for legitimate purposes as well as illicit ones, he said.

"We're expecting to send at least a million messages or more per week because these users are offering to distribute music on Kazaa or Grokster," said Cary Sherman, president of the RIAA.

Sherman described the move as an educational effort to inform users that offering copyrighted music on peer-to-peer networks is illegal and that they face consequences when they participate in this illegal activity.

[Axenolith]

And making a copy is not stealing.

So, if I happen to aquire the process for creating some new pharmaceutical from "Giant Biotechnicals" system, say from some employee listing a directory it's on as a swapping directory, and then proceed to duplicate it, I'm cool eh?

[SamAdams76]

With all this hysteria over file sharing, you'd think that the music industry has already gone under. But the most recent copy of Billboard points out that so far in 2003 (as of April 13), over 163,000,000 CDs have been sold. That is a pace that will see well close to 500,000,000 CDs sold by year end - or almost 2 CDs for every man, woman and child in America. That's a staggering amount. Especially considering that there hasn't been very many "blockbuster" releases this year. In fact, it's been pretty much a down period so far as creativity goes. I mean, when a crappy and vulgar rap song like "In Da Club" by 50 Cent can top the pop charts for two months in a row, you know it is a pretty bad year for music. Must be that all that file-swapping is keeping the music industry afloat. I know that I've purchased at least a half dozen CDs this year alone from artists I have only heard online.

[Mister Magoo]

Here's today's Wall Street Journal take:

REVIEW & OUTLOOK

What Listeners Want

The history of business is littered with the corpses of companies that didn't adapt to new technology. We're about to find out if the major record labels and movie studios will avoid joining that unhappy list.

That thought occurs to us after seeing yesterday's news that Apple Computer is unveiling its own online music store. The service will be the first to allow anyone to pay 99 cents to download and keep any of 200,000 songs.

The Apple news follows a federal judge's refusal last week to shut down two Internet services, Grokster and Morpheus, that provide software allowing users to connect directly with one another and swap music. The judge ruled that since neither company operates a centralized service (unlike Napster, which maintained a list of songs available for download), they weren't responsible for what others did with their software.

We believe in copyright protections and sympathize with the music world's attempt to enforce them. The problem is that the industry has focused 90% of its energies on suing people, and not enough on developing new business models that would encourage consumers to buy (rather than steal) their music.

True, the industry did get a court to shut down Napster, the grandaddy of music-trading sites. And it is using the courts to force Verizon to hand over the names of people suspected of using its lines to swap files. But last week's verdict suggests that even the recording industry's legal battalions may not prevail in court.

And even if they do, they'll have to deputize half of America to track down all of the pirates, many of whom happen to be children. In its wisdom, for example, the industry has demanded that universities rat out teenagers who illegally download, an action that led to the Naval Academy threatening to court martial midshipmen. This isn't exactly the way to win hearts and minds, not to mention customers. And global compact disc sales still fell by 9% last year, with much of the decline due to illegal file swapping. Some 50 million Americans are estimated to have poached digital music in 2002.

Meanwhile, the industry's attempts to encourage people to buy (rather than steal) their music online have been lackluster. The studios helped launch two digital services last year -- MusicNet and pressplay. But both continue to focus on "renting" music, rather than allowing people to buy and keep it. They haven't yet broken past 300,000 users.

Which is where Apple comes in. Computer hardware and software companies have long coveted the market for digital entertainment, and they are moving aggressively to get their share. Apple's Steve Jobs has been first to market before, and he will probably have company. RealNetworks, a software firm, announced last week that it will spend $36 million to buy an online music service called Rhapsody (whose subscribers can buy songs for 99 cents apiece). You can bet it won't be long before Microsoft, Hewlett Packard and other tech giants offer similar products.

The industry is at least selling music rights to Apple, a sign that it is beginning to understand that the days of the $14 CD may be over. The larger point here is that, lawsuits aside, someone is going to figure out how to use new technology to give consumers the entertainment they want. The recording and motion picture industries can either adapt, or join the dinosaurs.

Updated April 29, 2003

[supercat]

One concept which has generally been applied to copyright practice, even if not copyright law, is that a purchased instance of a copyrighted work provides the purchaser with a transferable right to use one instance of that work at a time. This is often extended to include the case of one person using multiple instances at a time (not applicable to music, but very much applicable to many types of application software).

If you take the CD from the library and transfer some music onto your iPod, then as long as you still have the CD, only one instance of the music thereon (the one on your iPod) will be in use. When you return the CD to the library, however, you are thus allowing someone else to use it. As such, you have no continued right to use it yourself unless you can somehow ensure that nobody else is using it at the time; since you generally cannot be sure of that, you cannot use the music unless or until you check it out again.

It's too bad that there hasn't been any legislative effort to encode the 'instance use' principle into formal statute; I think it would make many things much clearer.

Of course, given that the RIAA wants people to buy separate copies of music for every differnet music-listening medium (if not every player), they'd want nothing to do with such a change.

[Axenolith]

Theft of an article entails depriving the original owner of its use. Copying a recording does not take away anything tangible from the owner of the original recording. He still has the article said to have been 'stolen'.

Don't hold your breath waiting for new prescription drugs to be developed when the same arguement is used on that...

[longtermmemmory]

there are xp key generators redily available. The xp registration has already been overcome.

The problem is the RIAA is attempting to convert the copyright into the same thing as physical property rights.

Since the RIAA already collects a "private tax" on each cd burner they have no legitimate issue with the burning.

[rottweiller_inc]

So, if I happen to aquire the process for creating some new pharmaceutical from "Giant Biotechnicals" system, say from some employee listing a directory it's on as a swapping directory, and then proceed to duplicate it, I'm cool eh?

Lets apply that to the process for turning oil to gasoline and say Arab Oil owns the copyright and establishes a giant monopoly, much like the recording industry

[oceanview]

not possible unless all the hardware standards are changed to include encryption, thus rendering all CD players in homes and cars unusable also. if the RIAA wants to try and introduce a totally new standard and they can get people to buy all new hardware and music, let them try. Here's a tip: no one will. No one will buy all new players, no one will buy these PCs.

[longtermmemmory]

Don't hold your breath waiting for new prescription drugs to be developed when the same arguement is used on that...


* * * ** * ** **

They used the same argument when the pharmacutical companies tried to prevent the introduction of generic drugs.

They have also gotten into trouble with frivilous suits to try and stop generic introductions. New drugs are invented BECAUSE the patent lapses. It opens the information to a broader number of minds.

[Axenolith]

Analogising it to turning oil to gasoline is literally like analogising it to evaporating water for the most part. Now, when you get to catalytic cracking or hydrogenation, its another issue, but the patents on those processes are probably long expired.

There was a big suit won by Arco I believe though, for other companies use of their MTBE reformulation...

[Axenolith]

The Patent for music is longer, for what its worth. Under a prescription drug package though, or socialized medicine, the prices for innovative drugs would be severely capped. The incentive to create them would disappear. People would literally be given near instantaneous access to the process to generate a newly created drug in order to "keep the systems costs down". Where's the incentive to do it then?

[Revolting cat!]

Exactly as you stated in your post. Illegal? Maybe? Immoral? Who knows. We all break, knowingly and unknowingly, many (stupid) laws during a week.

I recently downloaded a copy of Disney's "Song of the South," which that company has effectively embargoed for many years.

Wait a minute! Song of the South may be, for all we know, in public domain, or it may go in public domain tomorrow, which means it is already in public domain in some time zone. 100, 1000 (or whatever) pages of dense lawyerspeak of the copyright law, 1000 of pages of legal opinions (and that's no exaggeration) and they tell us, summarize it as just plain stealing? Why don't they write the law to say "Thou shall not steal!"? Arbitrary, capricious, changing and changeable, ununderstood and unknowable by mortals, and, as we demonstrate above - expiring after so many years! La di la!

[MatthewViti]

"In Da Club" LOL!!!!!!!

[longtermmemmory]

FYI: (no criticism) the differences are important.

Patent = product intelectual property, strongest intelectual property.


Copyright = creative work protection, weakest intelectual property protection.

[ARCADIA]

I am surprised at you. What happen to your free market ideal?

The market has simply decided that distributing music media is no longer worthy of reward. Instead our dollars will go to support a vigorous internet, and various media with which to make our own recordings. The music industry is going the way of the gas station pump jocky. They just haven't admitted it yet.

Modonna and the Dixie Twits will simply have to decide whether they will accept a pay cut to merely several times the POTUS' salary, or simply quit the industry and flip burgers.

It is a healthy evolution. As the new distribution system gets stronger we will see 1000% improvement in the shear number of new artists that will get a chance to shine. When a media company expends its energy blocking access rather then promoting new ideas, it has certainly lost its way, and is no longer serving the public interests.

Let them die. That is how the free market is suppose to work.

[Poohbah]

Kazaa lite is a cracked copy without the spyware.

Or so the people providing it claim.

[Poohbah]

The market has simply decided that distributing music media is no longer worthy of reward.

Fine. That doesn't give you the right to download free copies of copyrighted material against the wishes of the copyright owner.

As the new distribution system gets stronger we will see 1000% improvement in the shear number of new artists that will get a chance to shine.

Who will then discover that whatever distribution channel they use for selling their product cannot compete with the five-finger discount.

Don't want to pay the copyright holder's asking price? Don't buy the material in question.

The "free" market does not refer to the price tag.

[longtermmemmory]

what is the actual cost to the downloader? A cd, electricity, time? lets say this all totals to 20 cents, would a person pay 40 cents to download the same song? 5 dollars to download a whole album. (and forget the limiting the uses) It simply goes to cost/benefit analysis.

Would the RIAA be happy with a "tax" on all isp subscriptions? a 5 cent isp RIAA tax? Nope, why? because its about control.

[Poohbah]

what is the actual cost to the downloader?

Effectively nil--your economic analysis presumes that the downloader would not use his computer and ISP connection for other purposes if the d/ls were not available.

Would the RIAA be happy with a "tax" on all isp subscriptions? a 5 cent isp RIAA tax? Nope, why? because its about control.

Would you be satisfied with someone squatting in your house, against your wishes, even if the government paid you some stipend? Nope. Why? Because it's all about control. You're just being SELFISH, not housing with the less fortunate! How DARE you assert any property rights you think you're entitled to? </parody of your rant>

[Revolting cat!]

The horse is out of the barn, dead and we keep beating on it! This topic is becoming like the "I'm a Bad American" thread. Oh, well, an opportunity for the pious to climb the moral high ground, like they presumably learned from the Leftists for whom such strenuous hikes are just MO!

The record industry had 5 or 7 years to get on top of this issue and it sat on is laurels. Why not? The $18.98 list CD's are pure profit. (And don't educate me about those discounts at the Wal-Mart - the two closest to me record stores sell them at the full list price!) The answer? This is not the record industry of the Chess brothers, or of the Ertugun brothers, or of some well-to-do housewife Florence Greenberg, who founds Scepter Records, hungry entrepreneurs one and all. They got screwed themselves (by the distributors) and they screwed others (the artists) in turn. But they survived, as did their artists. This today is a record industry of MBA's, of bean counters, of Hollywood party hustlers who could be just as comfortable marketing packaged chicken manure. And probably better at it.