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DOJ Drops Online Music Antitrust Investigation
JOstrow writes "On Tuesday, the Justice Department ended a two year long antitrust investigation into the online ventures of the music industry. The assistant attorney general for the antitrust division, R. Hewitt Pate, was quoted, 'Consumers now have available to them an increasing variety of authorized outlets from which they can purchase digital music and consumers are using those services in growing numbers.' What took off a lot of the heat was pressplay (now Napster!) and MusicNet changing their services to allow songs to be transferred from machine to machine."
The Irritating thing is that large businesses can get away with anticompetitive behavior and then, at the last minute get off scott free. why don't the file sharing or P2P crowd have the same Deal?
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Why the hell is a ruling on antitrust action being made based on the current market, not when the action was first filed? This is the most idiotic thing I've ever heard. If I get arrested for a crime, which is later repealed, I'm still under arrest and guilty of the crime.
When this case was filed, RIAA et al were suing anyone who had anything to do with online music distribution...at one point Napster was arguing that the lawsuits were less about copyright violations and more about forcing consumers to use RIAA's own crappy services.
Now two years later, because everyone had no choice but to go along with the insane pricing and restrictions RIAA wanted to begin with, we suddenly have plenty of options and competition? Bull! We consumers have already been harmed. the lion's share of online music cost is RIAA royalties. We now have to choose between the Microsoft/WMA world or the Apple/AAC world, with no way to move purchases from one to the other. This is exactly what RIAA wanted all along, and by forcing early adopters to choke to death on the crappy v1 PressPlay and MusicNet, everyone else thinks iTunes Music Store and Wal-Mart are wonderful.
F that. Yet another case of our Republican administration yanking the leash back to reward their favorite corporate donors.
The only thing about this whole mess that is true is that P2P applications are so far staying well ahead of the piracy police...so, yes, I guess it is true that consumers have plenty of choices and options...Kazaa, eDonkey/Overnet, iMesh, BitTorrent.
- JoeShmoe
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-- I wonder which will go down in history as the bigger failure: the War on Drugs or the War on Filesharing
Just use irate. All the free (beer) music you can listen to, computer-selected to be music you will like. The user interface could use a great deal of polishing, but I'm sure that is happening. And it's quite usable in its current state. I see no reason to support RIAA music for any reason anymore. (And sharing their music is supporting them, as it builds popularity).
From an antitrust perspective, this is right. The labels blew it so badly in online music distribution that they failed to achieve significant market share. They tried, but failed through sheer incompetence.
But it's not like successful anti-trust lawsuits ever punish infringing companies enough. For example, Microsoft has been found to be an illegal monopoly time after time. But no serious punishment or solution, such as splitting up the company, has even been considered. Meanwhile, Microsoft continues to unfairly exploit it's desktop monopoly and crush any competition.
The real target of anti-trust investigations should be all the large record companies. They get together, form the RIAA, and control the market. If this isn't a target for anti-trust action, I don't know what is.
there are still only less than 5 (how many are there now after the recent buyouts?) companies that own the vast vast majority of music copyrights and all sell their music for the smae prices?
what part of anti-competitive collusionary tactics between a handful of companies to Standard Oil themselves in charge of a whiole industry am i missing that made the DOJ drop it?
face it - the DOJ is useless to stop subtle and patently obvious monopolies. So be it.
We are bigger than they are... we're crushing them with Linux, and we can crush them by not buying CDs any more.
no problem. We are in charge.. they can't sue all of us.
guns kill people like spoons make Rosie O'Donnell fat.
Added DEC 25th, 2003 at 3:00 PM.
"And besides, RIAA representatives could never be reached for comment. The constant busy ring was like they were downloading on the intraweb 24/7....", said a government spokesperson.
Cover your eyes and click this link!
The real punishment for their evils is one worse than any gov. agency could give. In a world where name recognition is all important, the refusal to sell music online at first made illegal PSP programs have the biggest name in online music. Now if the common man wants digital music he thinks of kazaa long before pressplay. Reclaiming the Napster name helped them a little, but their was too much time between the Napster of old and its new corporate foil. They are dieing for not growing when they had the chance. The DOJ might have realized that and felt bad enough for them to call off the dogs.
Open Source Sushi
Not so. In the United States, although antitrust action is usually civil, unlike most other countries it is also a criminal matter. Check out the American Antitrust Institute's Primer on US Criminal Antitrust. The Sherman Act of 1890 provides criminal penalties for antitrust violations. In addition to fines, prison sentences of up to three years are possible.
Does anybody know if iTunes (or any of these other stores) now allow the official resale of songs to other parties? There was a story on slashdot a few months back about somebody trying this on eBay and getting stopped by the eBay TOS. Has this changed now?
Additionaly, am I right that as soon as Apple, Pressplay or any other venture goes bankrupt and I format my hd and reinstall the songs from a backup, I'm out of luck and can't play them ever again?
Thanks for any clarifications!
If anyone feels the need to contact R. Hewitt Pate over this, here's the division's contact page.
And for your convenience, Mr. Pate's phone number.
202-514-2401
'Consumers now have available to them an increasing variety of authorized outlets from which they can purchase digital music and consumers are using those services in growing numbers.'
Unfortunately (as was hinted at in another comment), The Big 5, acting as one, still control the material; yes, we have more middlemen ('outlets') to sell it to John Q. Public, but the middlemen have no choice in supply. Hence, 'consumers' (the term the DOJ used) still don't have any true choice.
If one manufacturer had a monopoly on car batteries, yet I can buy said batteries from Target, Wal-Mart, Ace Hardware, and a few other stores, do I really have a choice? Is there any significant change to the monopoly status?
I think the DOJ is wearing the wrong kind of glasses, metaphorically speaking.
RD
There are two aspects to it - one is becoming a monopoly itself (which isn't illegal by itself, as long as it happens in a legal way), and abusing said monopoly. The problem from a legal point of view is that it is very difficult to give a clear definition of when exactly it is abusing the power. Yes, it might seem "obvious" to you that this is an abuse of market power, but it's hardly specified anywhere in a law that "under market conditions X, with a market power Y, it is illegal to do Z".
After all, there's no doubt that Microsoft, RIAA has a lot of power, in whatever they do, simply because they're monopolies (no, that does not mean 100% market share. Look it up). The question is, where exactly is the border between use and abuse? It's a fundamental right, for companies as well as individuals to know what is illegal. Not "we'll decide that this is illegal" after the fact.
Since it's mostly a gray area decided on a case-by-case basis, they do not want it to be self-limiting out of fear. That's why most penalties are designed to be corrective rather than punitative, or in more normal terms, their goal is to end the reason for the anti-trust suit, nothing more. Think of it an anti-trust ruling almost like a specific instantiation of the law "It is illegal for a company with Microsoft's market power, under the current market conditions, to integrate IE the way they do." After that it is "law", and you can punish them bigtime if they don't comply with that.
The thing is, when conditions change, the "law" goes null and void. Which leads to cases like this, where they basicly say: "Well, the market conditions are no longer the same as at the time of the filing, so even if we went ahead the ruling would have no effect whatsoever."
If you want an analogy, a dog on a leash gets reined in when it goes too far (corrective), it doesn't get a beating because it went too far (punitative). If you did, it would probably stick very close to you, afraid of getting a beating (self-limiting).
The whole problem occurs when the legal system is lagging. The leash is an instant feedback "this is the limit". This investigation is like saying "Well, the dog tore the leash, but ran out of the city (where it's supposed to be on a leash) and into the woods, where it usually runs free anyway. So everything is ok, no need to leash it now." The result is the dog can keep running (drag it out in court) until the problem solves itself and nothing happens.
It sucks, and there really should be punitative penalities for what I mean are blatant and obvious abuses of power. We don't have to list all the possible ways to kill a man in the murder paragraph, then we shouldn't have to list all the ways to stifle competition in the anti-trust paragraph either.
Kjella
Live today, because you never know what tomorrow brings
Don't know why I'm responding to an AC but this stuff is not too badly written and fairly juicy.
I think the selectivity of the use of the independent prosecutor law and who chooses to use it is a moral gray area. In retrospect, it is easy to say, 'Clinton should have come clean,' and suffered the embarrasment that apparently terrified him more than lying under oath.
However, that Clinton underwent an investigation because of his extending a law providing for independent prosecutors and then suffered because of it is not 'justice,' at best, someone half-clever might would call it 'irony,' while someone who'd read three books might throw in some French and call it, 'being hoist by one's own petard.'
Considering the nature and intensity of the investigation, with its expansion into any and all areas at a cost to the taxpayer in the tens of millions, it's very surprising to see that all the investigation turned up can be summed up by saying, a. 'While in office, President Clinton possessed a male libido' and b. President Clinton acted on its urgings.
You could say, in fact, that the investigation was the last bastion of ultimate lameness, because actual 'investigation,' had nothing to do with its success: as the O.C. himself pointed out, only someone's ratting out Clinton to the I.C. led to the discovery of the pecadillo and subsequent perjury.
When you talk about the independent prosecutor law being something the Republican party wanted to do away with, you have to take into account what the law was meant for and what it reacted to. In the right hands it can be used as a tool to root out real, genuine crimes against the people of this country and the democratic process like, uh, well, Watergate.
While in the wrong hands--in malicious hands--it spends forty million plus to uncover the fact that the Leader of the Free World can get it up in a closet and it needed a lucky break to do it.
Please have your priorities examined at the door.
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