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Music Exec: ISPs Must Pay Up for Music-Swapping
Reuters ^ | January 18, 2003 | Bernhard Warner

Posted on 01/19/2003 7:18:43 PM PST by Leroy S. Mort

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 (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, 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.


TOPICS: Business/Economy
KEYWORDS: kazaa; peertopeer; riaa; rosen
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To: zarf
The nonsense is what labels and record executives have done to artists for years and years, allowing only those that meet with their approval to be promoted and make a living.

Of course intellectual property should not be free. Musicians are making it on their own now thanks to the freedom they can get from being online. People buy CD's. The copies are not preferred because people also want the case, the notes and the original CD.

Junk may not be bought as often, which is what mostly sees the light of day thanks to the labels.

41 posted on 01/20/2003 6:48:36 AM PST by alrea
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To: HHFi
I am a music fan and a record collector, and I buy lots of CDs, but in my tens of thousands of LPs, singles, tapes and CDs, I don't have a single thing by Faith Hill, Britney Spears or any of the other flash-in-the-pan no talent rappers and hip-hoppers with their MTV-ready looks and tuneless, say-nothing songs that are being shoved down the radio listeners' ears. We're told that the labels push them because that's what people want, yet all of them are suffering from free-falling CD sales.

I too have an enormous music collection - nearly 1,000 CDs and at least twice that many LPs and cassettes. But the vast majority of my purchases lately have been for either classical music (where very good values can currently be found) or "catalog" rock music - that is, rock music that is not current (i.e. from the 1960s or 70s).

I look at my music collection and I realize that most of what I listen to is "real." What I mean by that is, the music I like to listen to and go out of my way to buy is music by recording artists who are generally not "slick" and "packaged" like so much music is today. The "rock" or "popular music" portion of my collection consists of recording artists such as Neil Young, Bob Dylan, Allman Brothers, Waylon Jennings, Jefferson Airplane, Bruce Springsteen, etc. These are artists who put passion into their music and don't care about how they might look on MTV or how coarse and "unprofessional" their singing might be. None of the aforementioned artists would make it in today's music industry because they are not the "eye-candy" that record companies are looking for.

Now that recording industry has always been sort of a cookie-cutter industry. There were just as many faceless singing groups from the 1960s and 1970s (1910 Fruitgum Co. and Bay City Rollers come to mind) but the focus of the music industry was promoting talented recording artists with long-term potential such as Dylan, Zeppelin, Pink Floyd, Neil Young, etc. Despite the higher promotional costs in getting those artists established, these artists continue to sell truckloads of albums today and their albums will be selling decades from now while on the other hand, those albums by Bay City Rollers and 1910 Fruitgum Co. aren't even available anymore, except as collector's items on E-Bay.

Well starting about a decade ago, the music industry decided to put all their eggs in the teeny-bopper basket, promoting a whole slew of belly-buttoned Madonnas and Britney Spears for short-term gain and stopped developing serious recording artists who might not look good on MTV and sell a million albums off the bat but would have established loyal followings that would have translated into decades worth of revenue. The music industry is now reaping the results of this misguided short-term strategy.

Screw file-sharing as being the culprit. If anything, file-sharing is keeping the music industry alive. It's the only way most of us can find decent new music now that radio stations have come under the control of anal-retentive program directors who only care about reaching the lowest common denominator and thus only program music that is bland and unlikely to challenge the ear. Like the recording industry itself, radio stations have become slaves to mediocrity.

The recording industry are killing themselves. Popular music is at a creative low. Hopefully what will emerge is a new industry that will rejuvenate creativity and nuture talented recording artists of the future instead of taking a bunch of talentless kids, dressing them like hookers and hiring whiz-bang producers to disguise their lack of talent by producing soul-less but slick and clean recordings for them that everybody forgets about 12 months later.

42 posted on 01/20/2003 7:18:17 AM PST by SamAdams76
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To: zarf
"What non-music files? Like the bootlegged version of Microsoft Office you got off Lime Wire?"

Give ME a break, pal. I do publishing, which means I've got thousands of picture scans that I like to back up. I create them, from MY photos, from start to finish, with NOBODY'S copyright being violated. Got that? So tell me again, genius, why I need to pay a fee to the RIAA for backing up MY OWN FILES?!
43 posted on 01/20/2003 9:01:53 AM PST by canuck_conservative (I can get Office from LimeWire? Cool! Thanks for the tip!)
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To: HHFi; Bush2000
These guys simply refuse to get it: people aren't buying CDs for the simple reason that the major labels are churning out crap that nobody wants to listen to.

If no one wants it, why are people working so hard to steal copies of the stuff?

44 posted on 01/20/2003 9:05:33 AM PST by Poohbah (Beware the fury of a patient man -- John Dryden)
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To: canuck_conservative
Sorry pal, but just like crooks who rip off insurance companies, Medicare paitence who defraud the govenment and vandals who smash windows of retail outlets, freeloaders force all of us to pay more; directly or indirectly.

Too bad for you and me.

45 posted on 01/20/2003 9:09:59 AM PST by zarf
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To: Poohbah
Most people aren't downloading the entire CD. They only want the one or maybe two songs on the CD that are good. If I had the option to buy just the songs I wanted I would do that in a heartbeat.

I do agree however, that stealing music is wrong no matter how you do it. If it was MY music that was being stole I would be pissed too.


46 posted on 01/20/2003 9:20:57 AM PST by unixfox
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To: canuck_conservative
Funny how he knows the source to FREE software isn't it?


47 posted on 01/20/2003 9:23:06 AM PST by unixfox
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To: unixfox
Most people aren't downloading the entire CD.

True, but the claim was that ALL the industry produced was crap that no one wanted to listen to.

The RIAA-bashers seem to think that if you simply took all the money out of the picture, A Thousand Flowers of People's Artistry would instantly bloom.

It's WEIRD running into Marxists on FR...

48 posted on 01/20/2003 9:23:24 AM PST by Poohbah (Beware the fury of a patient man -- John Dryden)
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To: Leroy S. Mort
Almost fifty posts and Bush2000 still hasn't shown up yet?
49 posted on 01/20/2003 9:24:37 AM PST by jpl
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To: unixfox
Funny how he knows the source to FREE software isn't it?

When I was in high school, I knew who was selling drugs in the restrooms. I knew where to score coke and smack.

I never used drugs. I never attempted to actually get any drugs. The information I just cited was VERY useful in staying out of the way of the stoners and the cops, though.

50 posted on 01/20/2003 9:33:19 AM PST by Poohbah (Beware the fury of a patient man -- John Dryden)
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To: jpl
I agree with you, BUSH2000 must have gone back underground.

To the RAT underground.

51 posted on 01/20/2003 9:33:21 AM PST by Recon by Fire
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To: Poohbah
True, but the claim was that ALL the industry produced was crap that no one wanted to listen to.

I sure don't want to listen to it. It's all dreck, as far as I'm concerned. They've ruined "country" music. It's now a kind of suburban-wife-pop-hits.

But I have no dog in this hunt, I suppose, as I don't have broadband and can't get it, since I live in the sticks. Still, I don't think it's fair to charge people a fee on the assumption that they are going to violate copyright.

52 posted on 01/20/2003 9:33:33 AM PST by B Knotts
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To: B Knotts
I don't think it's fair to charge people a fee on the assumption that they are going to violate copyright.

It's called "guilty until proven innocent."

53 posted on 01/20/2003 9:40:35 AM PST by ShadowAce (Linux -- The Ultimate Windows Service Pack)
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To: alrea
garage technology is improving so much that the uncle has the technology to compete with the biggest studios with the best cocaine

He may have the technology, but he probably doesn't have the talent. All the technology in the world is worthless without talent, and that's what the record companies produce. Whether or not you agree with their idea of talent is a matter of taste.

There are a lot of seriously untalented people making their own CDs. Some of them are painful to listen to. Believe me, I've worked in music for 15 years as a producer, music journalist, and a song judge for Billboard Magazine, among other things. If you want a taste of what homemade talent sounds like, tune in to the premier of American Idol in a few days. All of those people think they're going to win it. That's scary.

54 posted on 01/20/2003 10:40:29 AM PST by tdadams
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To: kms61
The companies that make up RIAA have been bypassed by technology, just like the buggy whip makers of another era

Buggy whip makers went out of business due to lack of demand. Obviously there is plenty of demand for recorded music, just not much interest in properly paying for it.

55 posted on 01/20/2003 10:43:24 AM PST by tdadams
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To: alrea
the economics of the net are that label bureaucracy is no longer in "demand." ...freedom is again crushing bureaucracy.

The product in question is not label bureacracy, it's the music, and that very much is in demand. But you want to steal it rather than pay for you.

If I want a new Mercedes, I should be free to just go on the lot and take it? According to your definition of "freedom" I suppose so. Freedom is choosing between product 'A' and product 'B', not stealing whichever you choose.

56 posted on 01/20/2003 10:50:37 AM PST by tdadams
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To: alrea
The nonsense is what labels and record executives have done to artists for years and years, allowing only those that meet with their approval to be promoted and make a living.

A record company is a private business. What would you suggest, some sort of entitlement program or affirmative action for niche artists forcing labels to sign and promote artists they have no faith in?

57 posted on 01/20/2003 11:32:27 AM PST by tdadams
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To: zarf
Nonsense. Tell that to Mozart or Bach.

Mozart and Bach both lived before copyright.

As a matter of fact, there's an amusing story about Mozart as a child. I think I remember the gist of it. He attended a performance to which it was forbidden to bring paper and pencil, and afterwards asked the purpose of the restriction. He was told it was to prevent the audience from transcribing the performance and then selling it. Mozart then played the entire piece from memory.

So I guess claiming Mozart for the RIAA's camp is questionable.

58 posted on 01/20/2003 11:39:25 AM PST by Right Wing Professor
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To: Right Wing Professor
The point being that even M and B created for compensation. They didn't work for free.
59 posted on 01/20/2003 12:03:00 PM PST by zarf
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To: unixfox
All well and good, but songwriters who make their livings should be compensated PER SONG. They are not the artists. The songwriters especially are getting screwed.
60 posted on 01/20/2003 12:08:32 PM PST by zarf
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