Rock Lawwwbster

IFPI Invades China

2008-02-04T10:56:00.000-08:00

China is known to have a sky-high music piracy rate. It is a matter of physical piracy, as well as digital "deep-linking." In response, the IFPI, has decided to be more aggressive against Internet piracy in China.

There have certainly been suits filed in the past. This one is against China's largest Internet company, Baidu, which is based in Beijing. Also targeted is the important Web portal called Sohu and its associated company Sogou. They are accused of "deep-linking" to sites that offer illegal, pirated music downloads.

John Kennedy, the Chairman and CEO of the IFPI, said recently in a statement, that the music industry in China is willing to work with the technology companies, "but you cannot build a partnership on the basis of systematic theft of copyrighted music, and that is why we have been forced to take further action."

Recently, China's branch of Yahoo was sued for its policy of "deep-linking," as well. On December 19th, Yahoo China lost its appeal it had brought against the ruling that month at the Beijing No. 2 Intermediate People's Court. To this day, Yahoo China is still offering "deep-links."

One unusual aspect of this circumstance is the careful political games that are intermingled in the issue. Sohu, the Web portal, is the official sponsor of Internet content for the Beijing 2008 Olympic Games.

2007-10-24T14:05:00.000-07:00

Suspense was in the air for days. Major label after major label, including EMI, Warner Bros. and Starbucks’ Hear Music were in a fierce bidding war over the release of Radiohead's newest album In Rainbows.
Shunning both their old label and the new ones, Radiohead has found a home at "jam band" label, ATO, or as Rolling Stone wrote, "a.k.a. the label that Dave Matthews built."

The moment that ATO Records won the bidding war over Radiohead, it served as a momentous victory for independent labels, and provided yet another harsh blow to the struggling major labels. The public had spoken, and now the artists rise to the occassion on the difficult road to change in the music industry.

The deal Radiohead has signed with ATO Recods entails that, label offshoot Side One, would license the album for a predetermined period of time, with Radiohead retaining the ownership of the recordings. This is what artists dream about.

The addition of Radiohead to their roster would provide a major jump in status for ATO, which was initially known as a jam bands label, representing acts like Gov’t Mule and the North Mississippi All-Stars. However, more recently, the label has put on their indie hats and added acts like Ben Kweller and My Morning Jacket to the roster.

While ATO is still distributed through Sony/BMG, the acquistion of Radiohead will most likely only further divide the companies; convincing ATO that major labels are not all they are cracked up to be. Maybe they aren't even necessary.

Now it only remains to be seen if In Rainbows actually sells CDs months after being available for free online. These are exciting times.

Over the Rainbow

2007-10-16T09:45:00.000-07:00

A few years back, an article by the title "The Problem with Music," was written by Steve Albini. The opening paragraph is a startling image. He writes,"Whenever I talk to a band who are about to sign with a major label, I always end up thinking of them in a particular context. I imagine a trench, about 4 feet wide and 5 feet deep, maybe 60 yards long, filled with runny, decaying sh--. I imagine these people, someof them good friends, some of them barely acquaintances, at one end of this trench. I also imagine a faceless industry lackey at the other end, holding a fountain pen and a contract waiting to be signed."

This month, Radiohead decided they were not to be bound by their major record label anymore, and the band released In Rainbows largely on their own. This is not an isolated incident anymore. Trent Reznor of Nine Inch Nails declared he was free from his major label, as well, but in a slightly less classy manner. He ditched Interscope, and then attempted to scuttle the label-release of his up and coming album, Year Zero Remixed,by promising to leak all the tracks himself on the internet. Even pop maven Madonna may be leaving Warner Bros. and take a gigantic deal with concert promoter Live Nation. This is to include albums, concert promotion, licensing and merchandising. The major labels are not destitute just yet, but the idea is out there. Does an established act even need a major label anymore?

Bands that have a history and large fan base may even thrive on their own. The next question is, if the major artists leave the major labels in favor of their own control, are major labels becoming obsolete? Maybe not obsolete, but certainly the meat and potatoes of their business is changing. It is becoming a combination of catalog licensing and the pop business.

Not every band can do something as radical as Radiohead has done. Up and coming artists are likely to benefit from a major label's promotional muscle. Large labels may consider finally recognizing technology, specifically, the Internet, and the power it gives to the artists and creators. Certainly, it seems like the artists are on the ball. They no longer need to pay for production of an album when physical copies are unimportant. They don't need to spend the money promoting a record when that money will be recouped from them before they can turn a profit.

So the question remains: Can the majors adapt? There is no way to be sure, but the best bet at the moment seems to be pop music. Established pop and hip-hop acts, the likes Mariah Carey or Kanye West still need the strength of a major label to ensure big-time sales, and they are still getting them.

Final: No One Has the Right to Degrade

2007-04-18T16:17:00.000-07:00

The National Association of Black Journalists was the first to raise issue with CBS about Don Imus’ racist and sexist statements concerning the Rutger’s women’s basketball team. Ever since, there has been unending speculation about how this will effect the broadcasting industry and radio in particular. Where do you draw the boundaries in a culture that is swamped in obscene and vulgar speech?

Ken Auletta, media critic, points out that now there is mass confusion in the radio broadcasting circles. “If you're Don Imus, you say, 'Suddenly, I'm being fired for what I do all the time?" (ABC News Transcript). However, broadcasting standards do exist and Imus knew that on the public airwaves there are vulgarities that you cannot use, while he was being paid money to say them. And in a free market, it is really up to the executives at NBC, Steve Capus and Les Moonves at CBS, to decide if their companies are going to be associated with someone who repeatedly uses racial, ethnic, religious slurs. In an interview with CBS, Reverend Al Sharpton made the point that the uproar over Imus’ remarks is “about the responsible and ethical use of the airwaves” (CBS Fires Don Imus; Interview With Reverend Al Sharpton, Kurtz). As a culture, we are surprised not when slurs are said, but when people are offended. As far as terrestrial radio goes, hosts are worried that they will “all have to walk on egg shells from now on… as vile as his speech was, don't we lose something more valuable [in free speech] than just racial sensitivity?” (ABC News Transcript).

Meanwhile, Imus will be just fine. Financial Wire reports that he will have a new burgeoning career as a shock jock on the new home of Howard Stern, Satellite Radio. Satellite radio channels are not as strictly regulated for decency as terrestrial programming is.

So, its established that radio hosts are not to use overly offensive, vulgar language while broadcasting. How then, do hip-hop artists get away with the rap lyrics that are racist and sexist, and also extremely popular? The difference between Imus and rappers may be that the rappers are actually censored on radio and have been since the beginning. This is because of Mrs. Gore and the music fan group, The PMRC. References to guns and drugs are “bleeped, reversed and flat out cut out of songs” (Really Really Good: Turn Off The Radio - AKA the Whole Story of Imus and Hip-Hop, Cue). The actual words marijuana and gun are forbidden on any Hot or Jamz station across the country, at least until after-hours (Really Really Good: Turn Off The Radio - AKA the Whole Story of Imus and Hip-Hop, Cue).

The argument is not for less censorship of rap lyrics, but rather, how do we change this culture? Amy Holmes, a republican strategist, remembers when C. DeLores Tucker first launched her campaign against hip-hop lyrics. She was declared “old and out of it and unhip and uncool” (CBS Fires Don Imus; Interview With Reverend Al Sharpton, Kurtz). Now, though, all different age groups and all different ethnicities seem to have had enough."Essence" magazine has had a take-back-the-music initiative since 2005 (CBS Fires Don Imus; Interview With Reverend Al Sharpton, Kurtz).

Still, there is no shortage of consumers of urban music. In an MTV phone interview, Snoop Dogg responded to Imus’ comments. "We ain't no old-ass white men that sit up on MSNBC going hard on black girls. We are rappers that have these songs coming from our minds and our souls that are relevant to what we feel" (Offensive language -- where to draw the line, Winn). The problem is that the lyrics is that they have mainstreamed the denigrating language. When you take into account that 80% of the consumers of gangster rap are white, teenage boys, it spreads into the mainstream so much so that it ends up on MSNBC, a news organization at CBS radio in the mouth of Don Imus (CBS Fires Don Imus; Interview With Reverend Al Sharpton, Kurtz). Constance Rice, a civil rights attorney, believes the first fight should be against the artists and music that made this kind of language top, number one hits. She says, “Imus didn't come up
with the song, 'I've Got a Ho in Every Zip Code" (ABC News Transcript).

Perhaps, white America fails to be shocked by this behavior because of what Barbara Ciara of the National Association of Black Journalist, calls "diversity fatigue," which creates a tacit acceptance of language that insults racial and ethnic groups and women (Offensive language -- where to draw the line, Winn). Even Imus himself knows “that these young women, young black women all through that society are demeaned and disparaged and disrespected by their own black men and they are called that name. I know that doesn't give me obviously any right to say it. But it doesn't give them any right to say it” (CBS Fires Don Imus; Interview With Reverend Al Sharpton, Kurtz).

So now we hope that professionals in the media, including talk radio, cable television, newspapers and magazines will decide to put their energy into this issue, and even though the media has a split-second attention span, keep raising the issue so we educate America. In the Huffington Post last week, “All in the Family” creater Norman Leor talked about “an unending coarsening of the culture” (Offensive language -- where to draw the line, Winn). Perhaps the media is not to blame, as they merely respond to our calls and demands. Hosts like Imus have made bigotry entertaining. Listeners enjoy hearing this man and his racially charged remarks. If that is what passes for entertainment these days, then we should heed the words of two very famous rap artists, Ice Cube and dead prez, and "Turn off the radio! Turn off that bullsh--t!" (Really Really Good: Turn Off The Radio - AKA the Whole Story of Imus and Hip-Hop, Cue).

Licensing Interns, Your Jobs are in Jeopardy

2007-04-10T19:06:00.000-07:00

Necessity is the mother of invention, is it not? For quite some time now, music industry onlookers have been grappling with the question, "How do we deal with this Internet and all the problems it promises to cause us?" Well, finally, a company decided to deal with one of those many new problems. Digital Licensing Center (DLC), a division of BMI, has been growing and now claims nearly 500 websites that license through the service.

Richard Conlon, BMI’s Vice President of New Media & Strategic Development, is excited about the service's growth. “The DLC is a digital tool that has met its mandate to simplify music copyright licensing." He is right. DLC has simplified the online licensing process and, when expanded beyond BMI, will help reduce costs associated with this licensing area.

BMI launched the service and site in May of 2000, and a newer version 2.0 debuted in 2004 with additional features. In 2006, nearly 200 additional users acquired their performing rights license through the DLC. DLC is a fully automated end for securing performance licenses online. The website can publicly perform all of BMI’s 6.5 million copyrighted works.

DLC's system, called Klick-thru, allows Internet sites to execute licenses without the need for paper contracts and the bureaucratic sluggishness. It does this by accepting the fee payments by credit card. Users input the music tracking data into Klick-thru, and the royalty payment is calculated. As is traditional, BMI's performance license fees are based on the fees generated, which are then distributed as royalties to BMI's songwriters, composers and music publishers.

One Step Forward, One Step Back

2007-04-03T19:15:00.000-07:00

Steve Jobs. He's really got a hold on this up and coming generation, doesn't he? We aren't willing to pay for DRM protected music? Fine, let's just do away with DRM. Moreover, they will be offering these DRM free songs in a better quality. Now that is a great plan, and EMI was smart to jump on the bandwagon; to be the first. In this way, the pressure is on the other major labels to either match such a deal or even do better. According to Del Colliano of Inside Music Industry, the deal can only be a good move in that it "cooperates with the inevitable -- the marketplace (next generation) is demanding free use of the music they buy just as if they bought a CD at Tower Records." This is a big deal--literally and figuratively.

However, before you go thinking that we have entered the future and its all up and up, there are some problems that need to be recognized. EMI and Apple will offer songs and albums encoded into 256Kbps, DRM-free MP3 files which will sell for a new more expensive price of $1.29 each. If you already own EMI songs, you’ll have the privilege to pay more for the songs you already own in order to “upgrade” them for 30 cents a song.

As far as the price hike, the extra money must be headed for the pockets of the record companies. Certainly, it won't cost Apple and EMI much to make MP3 files instead of AACs. Some people see the price hike as completely fair and necessary, while others remain unsatisfied. The price increase is absolutely counterproductive to the way the next generation thinks about acquiring its music. It wants to own it, and own it for less, not more. Del Colliano suggests that in the near future "it may take a number less than 99 cents to keep the legal downloading train on track."

Also, while the quality will be improved, consumers should be aware that there are lesser known music download services offering Lossless and WAV-encoded downloads, which Apple is yet to integrate into its program. If, as Jobs says, sound quality is one of the major issues troubling consumers, why not update the songs to the highest grade?

The consensus seems to be that the Apple/EMI deal is a nice step forward for dealing with digital music and the ways in which to monetize it. Let them experiment. Let them see the flaws in the plan, and let them fix them. Then we can all celebrate.

Copyright Suits: A Fashion Trend?

2007-04-02T14:53:00.000-07:00

When this blog was first created, there was an entry concerning copyright in the fashion industry. The proposal, based mostly off of an article in the Virginia Law Review, posited that copyright regulations were not of much importance in the fashion field.

From the point of view of the article and study, imitation is an essential aspect of fashion creation. It even went so far as to call imitation "necessary." Until just recently, it was believed that the fashion business was one of the few creative industries where one might see constant creation where there is very lax intellectual property rights.

Now, however, I may be eating my words. On March 29, 2007, The New York Post, as well as many other news sources are reporting that Diane Von Furstenburg's studio has filed a copyright infringement claim lawsuit against Forever 21. The claim is that the "downmarket" retailer willfully copied the pattern, colors, and measurements of Von Furstenburg's popular dress. The designer's camp believes that consumers and untrained eyes will see the two similar looking products as being the same, and then when the quality is not up to par, will blame the designer and brand.

It seems Von Furstenburg has ended and era of peaceful inspiration and imitation. Until now, it was rare for designers to expend the time and effort necessary to go after copyright offenders in the courts, but Von Furstenburg is being aggressive; filing suits in five different states to protect her brand's intellectual property.

Maybe the fashion industry is just the last to join the fight against the threatening piracy and technology combination. The internet and digital photography make it more difficult for designers to protect their designs from imitators. Harley Lewin, of Greenberg Traurig, who is representing Von Furstenberg's studio, explains that, "with today's electronic media, you can show something in a store or on a runway [and] pictures, good ones, are available on the Internet within hours."

It sounds so remarkably similar to the complaints of record companies today, as they fight vigorously and, probably futilely, to keep their content under wraps and to themselves. Hopefully, there is a profitable way to share, because the internet, technology, piracy--they aren't going anywhere.

Guitar Hero

2007-03-27T12:59:00.000-07:00

A groundbreaking agreement has been reached between Musicnotes, Inc., the online leader in digital sheet music, and The Harry Fox Agency, Inc. They announced a licensing arrangement that will allow the new Musicnotes guitar tab download site to host copyrighted music from Harry Fox's publishers by the summer of 2007.

The service will be offered on a commission-free basis to Harry Fox's 31,000 music publishers. These participating publishers receive a percentage of the advertising income that the site plans to generate through visits, views, and downloads of hosted tablature. When one of the publishers' songs are viewed, they are compensated. They will retain control over their song catalog in this way.

The key point is that the two companies have found a way to monetize online content without charging fees. Kathleen Marsh, CEO of Musicnotes, said, “We are excited to have the technology and the expertise to assist publishers and songwriters in monetizing this burgeoning area of interest among musicians which, until now, has largely not been served in this way.”

It certainly is exciting to be able to deliver free musical content to so many consumers who are thirsting for it. Harry Fox president and CEO, Gary Churgin, pointed out that “Musicnotes proves the viability of a copyright-friendly, ad-supported guitar tab website." It also may prove the viability of similar sites hosting recorded content, as opposed to tablature.

The RIAA Goes to College

2007-03-26T15:12:00.000-07:00

The Recording Industry Association of America, the RIAA, is still trying to combat the extensive piracy that takes place on college campuses and universities in the U.S. The Student Monitor from 2006 reported that over half of college students downloaded music illegally. Also, the market research firm NPD, found that college students account for more than 1.3 billion of the illegal music downloads in 2006. The students only represented 10% of the sample, yet they accounted for 26% of all music downloading on peer to peer sites and 21% of all peer to peer network users. NPD surveyed students to find that more than 2/3 of all music they report acquiring is obtained illegally. Therefore, acting on behalf of the major record companies, the RIAA sent a batch of 405 pre-litigation settlement letters to 23 universities. This is the second time the association has done this.

The letters take the approach that the RIAA recently adopted in its other threatening letters to potential litigants. As a service, students will have the opportunity to settle the infringement claims brought against them at a discounted and without going to court. In this round of letters, the RIAA informed the following 23 schools of a forthcoming copyright infringement suit against one of its students or personnel: Boston University, Columbia University, Dartmouth College, DePaul University, Drexel University, Ferris State University, Ithaca College, Purdue University, University of California - Berkeley, University of California - Los Angeles, University of California - Santa Cruz, University of Maine system, University of Nebraska - Lincoln, University of Wisconsin system, Vanderbilt University, and Virginia Polytechnic Institute & State University.

"Not every student will take advantage of this opportunity, but those that do get the benefit of a discounted settlement and no public mark on their record," explains Steven Marks, Executive Vice President and General Counsel for the RIAA. On behalf of college students everywhere, thank you, RIAA, for your continued mercy and lenience.

It is misguided, of course, but here is what the RIAA is doing right. There may never be an end to piracy in our lifetime, but if there is a way to diminish the harmful effects, surely education is the path. Last month, the RIAA began a new education program focused on illegal file sharing on campus. The initiatives represent a significant expansion of the association's efforts.

Indies Finally Gain From Payola

2007-03-20T18:26:00.000-07:00

Soon the Federal Communications Commission will approve a settlement concerning the practice of payola. The American Federation of Television and Radio Artists sent the FCC a list of suggestions on a settlement on which they felt both parties would agree, says the Hollywood Reporter.

Thomas R. Carpenter, AFTRA General Counsel and Director of Legislative Affairs, makes the very important point that in addition to fines totaling about $12.5 million paid by the likes of Clear Channel and CBS Radio, "meaningful remedies for the insidious practice of payola must include requirements for the minimum airplay of independent artists."

It would be just like radio to have this settlement imposed upon them and be a huge blessing in disguise. To many, the guise is thinly veiled. If radio were to quit playing the same seventeen songs back to back; if radio were to integrate something fresh into its programming--a new format or new music; people may actually listen. In a letter dated from February, Carpenter wrote that while independent artists make up about forty percent of music sales, those artists receive less than 10 percent of the airplay on commercial radio. The consumers have not been getting what they are willing to pay for, so they drop out.

AFTRA applauds the settlement, reminding the people that, "payola hurts all of [its] members who are recording artists, but it is particularly devastating for [its] independent artists; independent record labels often lack the resources to secure airtime for their artists in an industry where the practice of 'pay for play' runs rampant."

Watch Out, iTunes

2007-03-19T18:28:00.001-07:00

On Friday, I went to the Apple store with my roommate. We were killing some time before a movie. First, we were just messing around with the applications and the teeny tiny iPod Nanos. Soon though, as is inevitable, we began browsing the internet. I checked my email, Facebook, and naturally, Myspace, but something very strange occurred . None of the computers in the Apple store could access Myspace. Right at this very moment, a customer standing behind me approached an employee with my very same inquiry. This may be iTunes' first efforts to kill Myspace.

My story is in jest, but there is truth to the tale that Myspace is making a name for itself in the digital music world, and iTunes may soon be looking over its shoulder for real.

An interesting report just came out called the Tempo Digital Music Brandscape study. One of the study's main focuses was on brand awareness. Over the past year, iTunes' awareness rose significantly in both unaided and aided awareness. It moved from from 57% to 66% for total awareness of American Downloaders age 12 and older. There were some losses for companies like Napster and some gains for companies like Yahoo, but the most significant development was the huge spike of consumer awareness of MySpace, which experienced a jump from 16% to 54% this year alone.

Matt Kleinschmit, Vice President of Ipsos Insight and author of the TEMPO study, says, "MySpace has effectively carved out a unique area of the market centered on social networking and direct-to-consumer recommendations, it remains to be seen if this model can be monetized and scaled while maintaining the copyright protections that content holders require."

The study also ranked the services by their positioning in "best: fee-based digital music service. Downloaders are more likely to rate iTunes as the "best" service, followed by Napster, but Napster trails 11% to 41%. Still, here again comes MySpace, which gained big in 'best' mentions as well, starting at 2% in 2005 to 8% in 2006. This jump makes it the third 'best' brand after iTunes and Napster.

iTunes continues to experience steady growth in consumer awareness, but the growth of MySpace may reveal aspects of services that some consumers feel lack in fee-based digital music destinations. iTunes certainly must see Myspace as a competitor of which to be wary, else they court the under-served market segments and steal some of that iTunes glory.

Staving Off the Future

2007-03-06T18:24:00.000-08:00

There's been a lot of talk lately about internet radio. Is it the next vehicle for that dying art of music broadcasting? Is it the savior of the radio format? Many people seem to think so. It is often said, when trying to market to the generation (namely Y) that has left it, radio must look to where that generation has gone, and the answer is the internet.

Just a few days ago on March 1st, the copyright board issued new rates and based them on a "per play" equation championed by the RIAA. The computation assumes mass audience and significantly large commercial revenue. For the consolidated group like Clearchannel, it makes sense.

However, for smaller stations or pretty much any station that is not of Clearchannel or ABC roots , this is certainly less so. Radio Paradise was one of the first groups to appeal to its listeners to stop this from taking effect by making people aware through blogs or other means. RAIN (Radio And Internet Newsletter) has a posting of the exact fee schedule, it and agrees with Radio Paradise that the fees come out to over 100% of station revenues in a typical internet radio scenario.

Now Pandora has joined the ranks by sending out out an email asking its listeners to contact Congress. Radio Paradise has posted links that they are asking people to follow, including an online petition.

Internet radio has had to pay higher performance royalty rates than analog broadcast services for some time now. It has put a damper on the growth of the industry, and this new fee schedule is not likely to help innovation in the area of digital radio. Note the RIAA and Clearchannel's desperate attempt to save their dying media by killing new ones. History clearly demonstrates that this is not the way to achieve rejuvenation. Internet radio will likely bounce back, but its hard to believe that in the meantime, terrestrial radio is the suggested alternative.

Pirates in Los Angeles

2007-03-01T14:17:00.000-08:00

Once again, a report has highlighted the traumatic effects of piracy to the recording industry, and once again, the focus is all wrong. The study conducted by the Los Angeles Economic Development Corporation (LAEDC) found that counterfeiting and piracy has cost Los Angeles companies $5.2 billion. The city itself lost approximately $483 million in tax revenues in 2005.

This makes it sound as if the nation’s economy is being ravaged by piracy. Keep in mind, however, that the companies most affected by illegal copies are almost entirely located in the Los Angeles area. Mostly, the pirates are doing their work in L.A. The report finds the entertainment industries; your music, movies, etc, to be the most impacted.

The report explains that piracy hurts these industries in a number of ways including lost sales, lower return on investments, and a loss of goodwill if consumers buy inferior goods thinking it is the real thing. That last one is a stretch. Give your consumers a little credit. They know an illegal download from a peer-to-peer site is not a CD from a store.

So what are they going to do about this? Increase DRM and copyright protection, naturally. It is unfortunate, the report says, that “companies also must bear the increased costs - for encryption technology, legal services, etc. - associated with protecting their intellectual property."

The RIAA and MPAA are really hoping that city and local officials will start cracking down harder on copyright infringers. They are lobbying for additional anti-piracy efforts by the city of Los Angeles, and they could not praise enough, the LAEDC for commissioning the study.

In response to the LAEDC’s findings, Los Angeles city officials have announced the formation of an Inter-Governmental Task Force on Piracy and Counterfeit Goods. The group will be comprised of members of law enforcement, business leaders, government, prosecutors, and judges, so this can mean one thing. The task force will be to come up with a strategy to further lock down content and copyright protection to deal with the problem of counterfeited goods.

When will they get the message that the harder they work at tightly controlling content and copyrights, the more content providers and legislators are resented and rebelled against by consumers? Lock it up tighter, RIAA, but this is contrary to the next generation’s musical culture, and it will drive us away.

Music is Different

2007-02-27T14:06:00.000-08:00

Solveig Singleton of the Progress and Freedom Foundation (PFF), recently composed a Progress on Point report entitled “Copy Protections and Games: Lessons for DRM Debates and Development.” In her report, she explains that in the gaming world; that of the game console and personal computer games, protected content is just as desirable as unprotected content as far as consumers are concerned.

Singleton offers up eight insights that she has witnessed working historically for the gaming industry, and urges policymakers in other media industries to adopt them.

1.Content producers do respond to consumer complaints resulting from copy protection.

2.Interoperability with general purpose media increases piracy risk, while hardware-linked protection proves to be the most durable.

3.Evolution in platform and distribution technology requires rapid adaptation of content protection.

4.Technical limitations of past media and platforms that made copying cumbersome meant less need for copy protection, meaning new solutions for copy protection must be found as media and platforms evolve.

5.Investment flows to business models with less perceived risk of piracy.

6.Effective copy protection enables content producers to supply a rental market.

7.Consumer demands often do not coincide with advocate demands, as consumers frequently choose content quality over lack of content protection measures.

8.Past expectations should not dictate policy or future business models for content.

There are some problems with applying these particular rules and standards to the music industry. It has been seen time and time again that DRM can cause consumers serious problems. Sony and its rootkit come to mind. Music content should not be hardware-linked. Consumers do not like that. Again, Sony tried this with its rootkit, and even iTunes can’t always get its users to commit to using only its hardware.

Singleton also explains that stronger DRM and protection from piracy allows content providers to tolerate a rental market. This does not translate to the music business either, as there are several companies set up for the rental of music. Subscription services cannot compete. People want to own their music, and they don’t want it to disappear if they choose to drop the subscription or there is an unexpected rate hike.

Finally, music consumers must differ from game users in that they quite often do choose lack of copy protection over fidelity. All you have to do is look at those pretty white iPod ear buds to see that quality is a nice, but not integral part of the consumer’s listening experience.

"The best policy going forward is for legislators to leave entrepreneurs' experiments with DRM alone, while continuing to support copyright with appropriate enforcement institutions and actions,” Singleton insists. Still, music listeners are a different breed. They must be. They want to buy a product, own it, and use it however they would like, and it seems only fair.

The reason for the difference in DRM toleration may be that gaming is not as personal; not as close to people’s hearts. Games also need not be as portable, and are certainly not linked as directly to people’s identities. Music is different.

Don't Update, Consolidate!

2007-02-23T17:03:00.000-08:00

Warner Music Group got its way. It gets to merge with EMI, bringing the famous "Big Four" down to the "Big Three;" even less selection and even less competition. That is probably why IMPALA, The Independent Music Companies Association, took issue with the merger and did not want to support the acquisition before the European Commission and other regulator authorities.

But alas, IMPALA and WMG have reached an agreement, be it vague. IMPALA will support the Warner/EMI merger and WMG will have to implement measures to increase and ensure competition. The Music Industry News Network reports the measures as the following:

1. behavioral undertakings to ensure competition and broad licensing;

2. recorded music divestitures to reduce market share and enhance the competitive scale of the independent music sector; and

3. substantial assistance to build the capacity of the independent music sector through industry bodies and the recently announced Merlin initiative, all of which are crucial to the independent music sector and which give independents full and fair market access, especially to the vital digital business.

It sounds a little, let's say less than strong, but consolidation seems to be the fad these days. Jerry DelColliano's INSIDE MUSIC MEDIA suggests that merging really isn't the direction these labels need to be headed. He points to Clear Channel as the example, as they were given permission to own and run almost every relevant radio station in existence and they recently chose to break up.

Consolidation actually didn't help radio become viable again, and it probably won't serve record labels any better, but WMG now has the legal backing to go and find out.

Mp3flat.com Has Fallen and it Can't Get Up

2007-02-20T12:29:00.000-08:00

Based out of Europe, Mp3flat.com is a site that makes automatic numbers of copies of musical works available for download in mp3 format. The popular and napster-like site, had made up to 30,000 music titles available that were thus being illegally placed at the hands and computers of the site's visitors each month.

GEMA jumped into action. The Cologne District Court, in response to a request by the European licensing association, issued an interim injunction against the operators of the radio recorder service. Mp3flat.com has had its legal run-ins in the past, so they undertook a massive reorganization of their business model. However, The Court ruled that even in its new form, the service still violates the copyrights of the composers, lyricists and music publishers represented by GEMA.

"Cologne District Court has once again put a stop to the mass reproduction of protected musical works under the guise of private copying. In their business models, service providers usually do not take account of the fact that the use of works on such scale is entirely at the expense of the authors. GEMA will therefore continue to take legal action against such operators," announced Dr. Harald Heker, Chief Executive Officer of GEMA. He went on to talk about how new techniques for digital distribution of music can lead to copyright violations on "a scale as yet unknown in terms of quality and quantity, when they are used against the creative music authors."

This leaves one to wonder what the effect may be on the current battles being fought over music licensing and rights in the United States. We have the RIAA suing its customers, YouTube haggling with content providers, etc. The authorities representing the music industry do not seem to be backing down, but rather going after service after service, endlessly shutting them down, allowing another infringing site to come up in its place. Performance rights societies seem to think that, given the tools, people will steal music in unimaginable quantities, and chaos will surely ensue, leaving authors starving and broke. This is doubtful given the legal and inexpensive options available and on the horizon. There is more to look forward to. There should be more focus on the carrot than the stick.

The RIAA: The New Mob

2007-02-15T18:53:00.000-08:00

The story goes, the RIAA recently sent a letter to ISPs with some requests. The letter asked that the ISPs better comply with the RIAA in the matter of correctly identifying peer to peer filesharers. It implied that the ISPs had given them incorrect information in the past, and that they would like the ISPs to keep their logs for 180 days, so that the customer can be better located and identified for longer. Furthermore, it suggests that the ISPs send out a form letter written by the RIAA to their infringing customers, notifying them that cases that settle early will be given a discount of $1000. There is even a website for customers looking to settle early with the address www.p2plawsuits.com.

This letter was then leaked to New York City lawyers, Ray Beckerman and Ty Rogers, (supposedly by someone working for an ISP) who then posted it on their blog, Recording Industry Vs. The People.

How nice this would be for the RIAA. No more haphazardly tracking down alleged infringers. They would simply send them a bill. This is a desperate move to keep these cases out of court. Maybe because the RIAA is yet to win one, and one woman actually succeeded in winning damages from the RIAA when her case was thrown out, coupled with the fact that using fear to intimidate their customers into a settlement is cheaper than the mounting legal fees.

With this new, less costly strategy the RIAA can reach thousands more of their customers and even avoid slapping subpoenas on them. It sounds much friendlier. Now you just call up the RIAA directly so that they can instantly and unmistakably identify you. Note the letter does not mention that the customer ought to contact an attorney, which is probably the first thing someone receiving that letter should do.

It doesn't even make a whole lot of sense for the ISPs to go along with this new policy, as it requires more labor and cost on their end. Would you put it past them though to be bullied into it or even fall for the RIAA's line about this being good for the customer? It saves them from having to go to court (where they might win!).

A mob boss comes to mind. "Look, People, we, are doing you a favor. You can deal with us peaceably now, or we'll send our thugs out looking for you later, and it won't be pretty." Hopefully, neither the ISPs nor the contacted customers will fall for this manipulation by the RIAA: The New Mob.

Chief Jobs

2007-02-13T12:27:00.000-08:00

I suppose, as this is a music law blog and everything, that I should add my two cents to the litany of commentators and post an entry on DRM and Steve Jobs’ post entitled “Thoughts on Music.” Personally, I am of the belief that DRM is a well-meaning, but flawed method of halting piracy. In some cases, DRM has proved its utility, but often inefficiently. There is no standardization, for one, and they should have had that set up from the beginning. Nobody wants a chaotic mess of cyber-pirates stealing all the music and sharing it with 5,000 of their closest friends, but that is unlikely to happen on a large scale, DRM or otherwise. Most people are not that interested or savvy. The Economist very much backs Jobs’ proposition of a movement to sell music free of DRM protections.

What is also interesting is the sudden change of direction Apple is taking. Jobs has gone from fighting in Europe to keep from having to open Apple’s own Fairplay DRM to players other than iPods (and citing ‘state sponsored piracy,’ by the way), to insisting that DRM was forced upon him by the record labels and that he would do away with it in “in a heartbeat.” Jobs seems to be quite the DRM flip-flopper; something to question should he ever run for a senatorial position. The Economist also echoes my belief that Jobs is trying to paint himself and Apple as “consumer champions.” While Sony is busy locking up content and the big four labels, more than half of them European-owned, are crying about “the analog hole,” Apple is here to save us. They want us to have what we want; how friendly. This is branding at its Disney-esque best.

Still for whatever reason Jobs is jumping on the “down with DRM” bandwagon, he’s got the right idea. People who insist on pirating music are already doing it, DRM and all. DRM on CDs has been tried and whole-heartedly rejected (see Sony), so the abolishment of DRM would most likely just have the effect of making legal online downloads easier to obtain and easier to transfer to devices. Should we extrapolate even further, one might conclude that this ease of use could translate to higher online music sales. That happens to be great for Apple and Jobs. Well, good for them. I think of Jobs as the chief of a tribe of Native Americans hunting buffalo in a western movie. He put his ear to the ground and heard the stampeding of the consumers as they fled DRM and locked-up content. He followed, and now its his game.

The Root of the Issue

2007-02-04T17:11:00.000-08:00

The root-kit. Now a thing of the past, but just last year this new, rather stealth, form of DRM was shaking up the music industry. It's been a while now since Sony implanted its semi-secret software in the CDs we bought and then used it to track our activity on our computers, and of course, stave off piracy.

The stories were pretty terrifying. You would hear about someone putting the CD in his or her computer and not being able to get it out. It "exposed consumers to significant security risks and was unreasonably difficult to uninstall" reports The Music Industry News Network.

Well, Sony BMG has decided to settle with the FTC, and is, in my opinion, getting quite a comeuppance. In the future, Sony must clearly disclose the limitations imposed on its CDs by its method of DRM, and all that wonderful marketing information that they so slyly collected is considered "fruit of the poisonous tree" and cannot be used. It must be able to be uninstalled by the average human.

However, the part that might actually make Sony BMG cringe a little is that they must allow consumers to exchange the "infected" CDs through the summer of 2007 and must also reimburse consumers for up to $150 of damage to computers injured by the root-kits. Depending on the number of people who actually take the time out of their lives to come forward, it could be a hefty sum. The settlement will be published in the Federal Registry shortly, and the Commission will decide whether to make it final.

It was interesting to see this story finally come to a resolution. Upon the root-kit's discovery, there was heavy debate about the legality of this kind of DRM and the methods on the horizon. Was the EULA Sony provided its consumers enough? What exactly is the law on how far a company can go in the name of anti-piracy pursuits? With Sony's settlement in this case there is some precedent set. No, a EULA is not enough, and yes, Sony BMG went too far to protect its content. Obviously, this type of DRM is not legal. It is not acceptable to consumers, but really, is any?

Copyrights: Now There's a Growth Industry

2007-02-02T12:42:00.000-08:00

Exciting, exciting! The 2006 report on the copyright industry in the US economy is finally out. The report, compiled by Economists Incorporated for the International Intellectual Property Alliance, updates ten previous studies. Still, what is exciting about this report is its finding that the copyright industry remains one of America's largest and fastest growing economic sectors. To be more exact, the United States' core copyright industries brought in about $819.06 billion in 2005. That's 6.56% of the U.S. gross domestic product for that year. Not only that, but its been growing! Its up .8% since the previous year. These "core" parts of the copyright industry were behind 12.96% of the growth achieved by the U.S. economy as a whole in 2005.

The copyright sector employed about 4.03% of United States workers in 2005, and it also pays them rather well. We see for the first time in this report, the estimated average annual compensation for a worker in this field: $69,839 in 2005 up from $66,997 in 2004. These numbers show a 40% premium of compensation paid to the average American worker.

It gets better. The copyright industry leads chemicals and related products; motor vehicles, parts and accessories; aircraft and associated equipment; food and live animals; and medicinal and pharmaceutical products in foreign sales and exports for 2005.

There isn't much growing going on in the music and media industries these days. It's nice to know at least someone is making out well in this deal.

Copyrights Just Aren't Fashionable

2007-02-01T15:33:00.000-08:00

We have all been taught that copyright protection is essential to innovation. It protects our artists and encourages them to work harder and create more by promising them compensation for their works. This notion is certainly deeply held within music and media law, and it's reflected in the statues. Copyright law is utilitarian and important. That is, if we don't want our artists to go on strike and refuse to create.

However, an article soon to be published in the Virginia Law Review postulates just the opposite. The authors, Kal Raustiala of UCLA School of Law and Chris Sprigman of University of Virginia School of Law, point to the fashion industry as a definite exception to this rule. The report will put forth that not only is imitation rampant in the fashion world, but it is necessary. Certainly, the fashion industry is never at a loss for new and inspired ideas. Even if you don't like the fashion of the day, you have to admit that the industry itself is not going away any time soon. In the fashion industry we see constant creativity in an area with very lax intellectual property rights. So that makes you think...

Maybe our songwriters and artists wouldn't just pack up and leave the music field after all. Maybe they wouldn't even start copying each other into an endless, cyclical monotony. Maybe they would stay and they would continue to innovate. Its a stretch, but what if these creative types didn't do it just for the money, as most probably don't given the rate of financial success in the music industry. If artists were even less driven by monetary compensation and credit than they are today, we might just get better, less commercialized content.

It remains to be seen whether we can really extrapolate the empirical observations of the fashion industry to the music industry and beyond, but it's something to think about.