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The agreement only covers the royalties collected under the "statutory license" and not the "interactive licenses". In other words, if you can pick and chose your music, the artists royalties still go through the labels. By making the statutory licenses as narrow as possible to those wanting to "webcast", the RIAA has pretty effectively assured that those who chose to cater to the consumers and public wants with interactive webcasts must seek the interactive licenses (which are negotiated on a case by case basis and cost much more), thus assuring it is business as usual. (and thus bypassing this agreement). SoundExchange does not collect royalties for uses of music directly licensed by labels (or interactive uses), such as the Echo Networks and Warner deal earlier this week.

This still doesn't address the fact that the RIAA and SoundExchange are NOT paying the webcasting royalties this year, even though they were due to be paid in July. This they announced in May. CNet ran an article

According to Webnoize (subscription required) article, The $5.2 Million payment they made on October 15 represents only income from the cable, satellite and Muzak licenses collected from Feb 1996 to March 2000. They do not include any payment for webcasting that they have collected since 1999. Ina ddition their administrative fee is 20% meaning the RIAA collected $1.3 Million for that distribution.

Its a step in the right direction, but its only a baby step. One interesting side note: the payment directly to artists is one thing that is contained in the Music Online Competition Act (MOCA) introduced on Aug 3rd by Rick Boucher and Chris Cannon, that the RIAA has condemned in no uncertain terms.

Not formally. There was a Webnoize article entitled ' OpenNap Server Operators Challenge Canadian Copyright Law ' (paid subscription required) where they interview Brian Robertson of CRIA.

My favorite quote of his in the article is:

If our legal people didn't think there was copyright protection in that area, we wouldn't have sent the letter in the first place

Of course I challenge anyone to find his reference to Canadian law in their letter to us.

Matt

The RIAA is also suing Launch over their Launchcast service. Launchcast is a personalized radio service that learns your preferences over time through song ratings, allowing you to (theoretically) tailor the service to your tastes. It's a streaming audio only service, no file sharing involved. I think this is actually a more aggressive move than the suit against Aimster.

All that it will take for opinion to turn against the free music crowd is for them to be seen as criminalistic freeloaders. Considering that a.) MP3.com has settled with most of the RIAA and will soon reopen it's My.mp3.com service (with paid options to offset the million$ in settlement options) b.) The major RIAA labels are all rushing to create flat rate music subscription services and c.) Napster will eventually need to make money to recoup all that VC funding and the according to Webnoize's survey over half of current Napster users would willingly pay $15 a month to use the service.

Eventually there will be several different ways to get music online and pay for it. Similar to the way that the MPAA fought VCRs and now there are many places we can rent videos. Currently people who watch movies for free (i.e. movie pirates, har har har) are considered freeloaders and criminals. It is not hard to conceive then that Gnutella users will become the w4rez d00ds of the music industry.

The creation of new algorithms is difficult. It's one of the things that cannot be done easily by the open source community, which has brought us a lot of very high-quality products in other areas, because you need a very specialized knowledge (signal processing, lossless compression etc.) that only few people have. There was a very well-written comment by Eric Scheirer on this on Slashdot months (a year?) ago, but I couldn't find it.

This webnoise article, linked on slashdot in may is probably what's being referred to here. The comment in question is toward the end of the article.

Now, generally people say this sort of thing for two reasons. Most commonly, they actually believe that no one else on the planet is as smart/knowlegeable/experienced as they are, and couldn't possibly produce rocket science of the requisite level. This is despressingly common, and one of the psychological hurdles (like fear of being judged on work-in-progress as if it's the best one could do in a polished effort) that holds people back from adopting open development practices. This is another strain of what RMS called the Cathedral style of development. It's what was said about writing compilers, operating system kernels and desktop applications, and I don't buy it here either.

The other reason is when the authors are trying to create a aura of "professionalization" around their work, usually so they can remain well placed in their employer's finances. The arguments are similar: "We're trained professionals. Do not try this at home," but the motivation usually has more to do with greed (or at least comfort) than fear.

Neither of these arguments are in line with the values of Open Source, and they amount to arrogant selfishness from that point of view. I'm not arguing that codec design doesn't require specialized knowledge, clever research, etc. Just that it's a fallacy that no one but Eric Schrier &c. can do it.

He did make some other points that a little harder to refute. For example, that the unfair 'fair licensing' patent situation is an historic artefact of the designing bodies being large corporations I can't dispute. He also makes the argument that allowing patented technology into the mpeg standard helps ensure that major corporate players use the standard, that the standard includes the best technology, and that the best technology be patented, rather than buried in an undisclosed proprietary standard. This appears to be well-reasoned, and is certainly consistent with his other claims.

I differ about this being the best course, mostly based on what we've learned about network effects and life in an exponentially-growing market. And vis á vis the dvd stuff, it appears that patents are more restrictive than trade secrets in an open source context.

Technical work on MP4 was completed in October 1998, and it is in the publication process at ISO now. I'm not aware of any fully-functional encoders/decoders yet.

-- Eric Scheirer
Editor, ISO 14496-3 (MPEG-4 Audio)

In summary, some of the technology from VQF is included in the MPEG-4 standard, but a .VQF file is not really an MP4 file since MP4 has its own file format, and VQF is only used in certain restrictive ways within MPEG-4.