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RIAA: Ripping CDs to iPod not 'Fair Use'

dotpavan writes "EFF has this article about RIAA saying that ripping CDs and backing them up does not come under Fair use. Ars Technica also reports on this, by quoting, "The [submitted arguments in favor of granting exemptions to the DMCA] provide no arguments or legal authority that making back up copies of CDs is a noninfringing use. In addition, the submissions provide no evidence that access controls are currently preventing them from making back up copies of CDs or that they are likely to do so in the future. Myriad online downloading services are available and offer varying types of digital rights management alternatives. For example, the Apple FairPlay technology allows users to make a limited number of copies for personal use. Presumably, consumers concerned with the ability to make back up copies would choose to purchase music from a service that allowed such copying. Even if CDs do become damaged, replacements are readily available at affordable prices. Similar to the motion picture industry, the recording industry has faced, in online piracy, a direct attack on its ability to enjoy its copyrights.""

47 of 830 comments (clear)

  1. Buy it again, Sam. by IIDX · · Score: 5, Insightful

    "Even if CDs do become damaged, replacements are readily available at affordable prices."

    Thanks, so I'll just buy another copy. Great solution.

    1. Re:Buy it again, Sam. by Maximum+Prophet · · Score: 5, Insightful

      Um, I have several CD that are no longer available, except perhaps, used, at higher prices than I paid for them. Changes One and Two by Bowie come to mind.

      --
      All ideas^H^H^H^H^Hprocesses in this post are Patent Pending. (as well as the process of patenting all postings)
    2. Re:Buy it again, Sam. by Rev+Wally · · Score: 3, Insightful
      What about those CDs that go out of print?

      About 10% of the CDs that I own, I would never be able to find again.

      --
      LOAD "SIG",8,1
    3. Re:Buy it again, Sam. by bloodredsun · · Score: 3, Insightful

      "Affordable prices"

      Which in the UK would be 15 quid for an album with probably 3 or 4 good tracks and the rest as fillers, so there's no way that I'd be buying another copy. Frankly, the Recording Industry Ass. of America are having a laugh.

      I'd rather back up all my CDs (and of course rip them to my iPod), leave the originals at home and put the copy in my car/take to work, so should one get damaged/be stolen I haven't lost anything. At no point have I engaged in file trading or selling of pirated copies, I've merely protected my (costly) investment. Now that's fair use, and to complain that it's not is why the Recording Industry Ass. of America are labelled "Pigopolists".

    4. Re:Buy it again, Sam. by elmegil · · Score: 3, Insightful

      Exactly. $18US for the average album is NOT "affordable prices". I already re-bought a lot of my collection from vinyl to CD an I refuse to be gigged again.

      --
      7 November 2006: The day Americans realized corruption and incompetence weren't addressing 11 September 2001
    5. Re:Buy it again, Sam. by idonthack · · Score: 3, Insightful
      My friend's house burned down, and most of his three thousand CDs had major smoke damage. They were unlistenable. Estimate fifteen dollars per CD.
      3,000 × $15 = $45,000
      Right, right. Very affordable prices.
      --
      Why is it that when you believe something it's an opinion, but when I believe something it's a manifesto?
  2. What about... by orderthruchaos · · Score: 5, Insightful

    a boycott? Seriously... it seems the only way to get the attention of hostile businesses is to deny them income.

    1. Re:What about... by Merenth · · Score: 3, Insightful

      People have been unofficially boycotting music companies for years because the product sucks, hence the declining profits.

      Music user: I heard that new song by and it totally sucks, no way I'm wasting money on that.

      RIAA: People aren't buying this new CD that everyone hates.
      They must be pirating copies, because they bought the last one that everyone loved.

      Boycotting only works if the people being boycotted don't live in a fantasy world.

  3. Enjoy? by ShadowsHawk · · Score: 3, Insightful
    " Similar to the motion picture industry, the recording industry has faced, in online piracy, a direct attack on its ability to enjoy its copyrights."

    Since when did enjoy == screw the customer for every last dime?

  4. Let me get this straight by Snarfangel · · Score: 5, Insightful

    "Even if CDs do become damaged, replacements are readily available at affordable prices."

    I thought I was "licensing the content," not "buying the CD." Shouldn't I be able to put my licensed content wherever I want?

    Until the companies offer free download replacement of the music I am (ahem) licensing, so I can store that content on a blank CD or wherever else I want, why should I care what they consider "affordable"?

    --
    This tagline is copyrighted material. Please send $10 for an affordable replacement.
  5. What rights? by Miros · · Score: 5, Insightful

    If you ask me, the RIAA "enjoys" its copyrights a bit too much already. They're trying to transform the music industry from one in which you "buy a copy of a song" into one in which you "buy a limited licence to play the song" under which you have no fair use rights (since you dont actually own the copy, only the right to play it). This is bad for all of us, and I would suggest that companies like Apple really helped pull off the bait and switch. At this point, if people stopped using the online download services and started using CDs again instead (for the rights) the record companies would probably pull the CDs or encrypt them somehow so you still had to be bound by their overrarching licensing agreements.

    Sorry guys, but I think the age of "my music" or "owning music" is dead, and currently in the process of being burried. This is just the latest shovel of dirt.

    1. Re:What rights? by pla · · Score: 4, Insightful

      Sorry guys, but I think the age of "my music" or "owning music" is dead, and currently in the process of being burried. This is just the latest shovel of dirt.

      Last shovel of dirt, yes - But on the RIAA, not on our right to own our culture.

      Slashdotters (and all people) need to keep in mind the difference between a major country's legal systems saying "fair use does not include a right to backups" and the RIAA spewing yet another round of customer-repelling male cow feces. The former means a lot of people turn into criminals overnight by the wave of the magic wand-of-exclusive-law. The latter means... Nothing at all.

  6. That's simply not true by 91degrees · · Score: 5, Insightful

    Even if CDs do become damaged, replacements are readily available at affordable prices.

    I have several CDs that I couldn't replace easily. Sometimes they go out of print.

    1. Re:That's simply not true by mwvdlee · · Score: 4, Insightful

      I have a number of promotional give-away CD's.
      These are perfectly legal, but some of the companies which distributed them no longer exist, so I cannot get copies from them even if I wanted to pay full price.

      Sometimes entire companies go "out of print" too!

      --
      Slashdot social media options: AIM, ICQ, Yahoo, Jabber and Mobile Text. Why no MySpace?
  7. Legally speaking... by MaestroSartori · · Score: 4, Insightful

    ...they could be correct. I don't know the law well enough to say - if memory serves correct, it gives some examples of things which are fair use, none of which include anything like backing up or shifting from one media to another for personal use. So yeah, technically they could be correct.

    But I think most people would agree that fairness is also a moral concept, and in that sense it's obvious that it is indeed fair use to copy something you already have to your MP3 player or PC to listen to in a more convenient way.

    Here's a hint to the lovely people at the RIAA and similar bodies around the world: if people can't use CDs in this kind of way, they won't buy them.

  8. Re:These people really don't get it do they? by Miros · · Score: 5, Insightful

    That isnt their goal at all, in fact, it's quite the opposite. They're trying to kill the CD market in favor of the online download business. Onine downloads do not give us the same rights that buying a CD does, in fact, we get less rights (seemingly only the limited right to play the song, and copy it to another medium a limited number of times). By making CDs more expensive or difficult to acquire, or incompatible with portable music players, they can cause the market to shift itself to mediums that they can better control, even before the CD becomes completely obsolete.

  9. Re:Big surprise by nagora · · Score: 4, Insightful
    It seems to me that the arguement in the article is just further incentive to not buy CDs.

    Which is exactly what the RIAA wants; they make far more off a download than a CD, at least on a per-track basis. Ringtones even more so. And for a lower quality product.

    TWW

    --
    "Encyclopedia" is to "Wikipedia" what "Library" is to "Some people at a bus stop"
  10. Is my iPod different from a cassette deck? by cob666 · · Score: 5, Insightful

    How is ripping a CD I bought and listening to that music on my iPod different than recording a CD I bought onto a cassette and listening to that out of my boom box? Didn't the RIAA already have a 'fair use' tax placed on blank media that takes this into consideration?

    What the RIAA doesn't realize is that there are quite a few people like me that ONLY purchase CDs so I can listen to them on my iPod. Before getting a portable mp3 player I would purchase perhaps one CD per year (I listened to the radio in my car and at work). Now I buy CDs so I have new content for my mp3 player.

    The RIAA will be shooting themselves in their collective FOOT if they turn a CD into a 'limited playability license'. I for one would not buy another CD if I didn't have legal 'fair use' rights to the content.

    --
    Do what thou wilt shall be the whole of the Law - Aleister Crowley
  11. I haven't bought a physical CD in years... by HaloZero · · Score: 4, Insightful
    ...and now I'm certainly not going to.

    'Even if CDs do become damaged, replacements are readily available at affordable prices.'

    Next, I'm sure they're going to say that copying the contents of a data CD (Microsoft Office, or Frontstep CRM) to a network software repository is infringant use on that license. Just prevents me from having to
    1. Find the CD once I know that I need it...
    2. Determine that the CD isn't being kept in the master disc binder...
    3. Determine which of my coworkers was the last to use it...
    4. Try to root through their crap in an attempt to find it.
    Back to music discs, though.

    So I'm not allowed to store the data on a networked disk drive to enjoy throughout my own personal network, nor am I allowed to play it on my own iPod, iPod Pico, or Rio Karma, or whatever the hell it is you kids have nowadays.

    Am I breaking the 'license' I bought when I play it in a CD player with 120second or 300second skip protection? Technically, the data has been encoded to digital media, and is therefore must be mutable into a file format.

    Online alternatives would seem like the solution. Because then I can just download an album, burn it to a disc, rerip it without copy protection, and REMEMBER THE GOOD OLD DAYS.

    Seriously, this shit has got to stop. Maybe satelite radio is where it's at...
    --
    Informatus Technologicus
  12. Re:Big surprise by Xymor · · Score: 5, Insightful

    Actually each one of these places you can play your files is one copy, and since you have a limited amount of copies, you're gonna have to re-buy the same song you already own once you have no copies left.
    In my understadnding, once you buy a CD, you have a license to play it's songs in any format, in as many devices as you want and as many cars you have.
    Another problem is iTunes proprietary format not being compatible with all media devices(or devices not compatible with DRMed media in general).

  13. What about citizens enjoying the public domain? by Luscious868 · · Score: 4, Insightful
    Thanks to likes of the RIAA and MPAA, citizens are no longer able to enjoy the benefits of works entering the public domain in a reasonable period of time. The original intent of copyrights and patents was to give the copyright/patent holder a reasonable but limited amount of time to profit from their work before it became avaialable in the public domain to benefit everyone.

    The RIAA and MPAA have essentially trampled on all of our rights as citizens in order to make some more money. Now, I think most of us are reasonable people here and we want to see people get rewarded for their work but the current copyright laws are just plain stupid. I'd prefer 25 years but I'd be willing to let that time limit be doubled. 50 years is more than enough time for any person or corporation to reap the benefits of their creations. After 50 years, copyrighted material should enter the public domain.

    Remember that copyrights and patents aren't some inherient right. Copyrights and patents are contracts between creators and every other citizen of this counry. We agree to give the creator an exclusive right to control who can reproduce a work with the understanding that after a certain limited amount of time the work will enter the public domain so that everyone can benefit from it.

  14. Either one or the other by Britz · · Score: 3, Insightful

    Either they sell you a license and you can loose your copy but still get it back, because you own a license, not a copy.

    Or you buy a CD as a "thing" and can do whatever you feel with it, as long as you don't sell the content to someone else.

    At least that is how it should be and how it used to be in Germany, but we are working to get to where the US law is now. And we are pickung up speed.

  15. Re:Big surprise by jmv · · Score: 3, Insightful

    It's actually the opposite. With a CD, you can do whatever you like in terms of portable player (no matter what the RIAA wants you to believe). With DRM-protected music, you'll end up buying the same music several times, which is *exactly* what the RIAA wants. That's probably the only way they can sustain your business. If you don't produce anything new, your only hope is to keep selling the old stuff.

  16. Well... by moultano · · Score: 3, Insightful

    Maybe stop giving them our dollars?

  17. Re:Backup and preservation of investment? by Overzeetop · · Score: 4, Insightful

    You clearly don't have a three year old in your house.

    --
    Is it just my observation, or are there way too many stupid people in the world?
  18. Re:Big surprise by montyzooooma · · Score: 5, Insightful

    Downloaded tracks cost relatively more than the CD version and you have less control over what you can do with them. With the CD you can rip it, lend it, play it or turn it into a shiny coaster if you want. Just because the RIAA doesn't think it's fair use to rip your CD to your iPod doesn't mean they are right. The only downside to the CD is that there are often only a half or a third of the songs on it that you'll actually listen to. That's a big downside though.

  19. RIAA trying to do.... by HangingChad · · Score: 3, Insightful
    ...what MSFT has already done. RIAA is trying to implment the same type system for music that MSFT was able to successfully employ for software. They're angling for product activation. Where you activate your music content before it will play on a device.

    Why is that so far fetched? You went along with it for software and they're using the same basic talking points. It'll cut down on piracy and everyone will enjoy lower prices on music. And if you believe that I have a bridge in San Francisco you can buy cheap. MSFT increased their prices in the wake of product activation, so will the music industry.

    And while RIAA's running the propaganda campaign in the media they're quietly sinking millions into lobbying efforts to get the few in Congress they don't already own, like Orin Hatch, to go along with what they want.

    You put up with it in software, you voted for the people selling you out to corporate lobbyists. I realize this will be an unpopular point, but you get what you tolerate.

    --
    That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage
  20. Last straw for me. by moultano · · Score: 4, Insightful

    I'm never buying a piece of music from the RIAA again. I'm not going to give money to companies that use it to assault my rights in court.

    Vote with your dollars people.

  21. Re:Big surprise by jocknerd · · Score: 5, Insightful

    I respectfully disagree completely. In my opinion, buying a CD that has no copy protection on it is the only way music should be purchased at this time. Forget what the RIAA says. I can rip my CD's to my iPod. Why? Because the technology is there and the courts have granted me Fair Use rights.

    And why do I want to own CD's instead of songs from iTMS? Several reasons. One, its a physical copy that can be resold. And two, because legally purchased music from online stores such as iTMS have DRM built in. Sure, Apple's Fair Play DRM is the least restrictive measure of DRM there is. But its still restrictive. How? Try playing your music through TiVo's desktop software. It can't play DRM'd AAC files. But every CD player in the world can play a true CD. And that CD can be legally ripped to a format of my liking regardless of what the RIAA's lawyers want to say. And the Fair Play DRM is also on Apple's videos on iTMS. But guess what, unlike the music, they won't let you copy these videos. So, essentially, you are locked into using iTunes and Quicktime for these videos. Which brings up the real reason for DRM. Vendor lock-in.

    Sure, the RIAA pretty much insisted that Apple use DRM when they opened iTMS. But it has screwed the RIAA ever since. Had they not insisted on DRM, iTMS would not have the upper hand in their battle with the RIAA. Apple may not have wanted DRM then, but I guarantee you they want it now. Why? Because if the music on iTMS doesn't have DRM, then it would be much easier for you to purchase music from iTMS and play it on any player out there. With the DRM, you are pretty much forced into using the iPod. Do you think that Apple would give up the vendor lock-in now? And what if an independent artist wanted to put their music on iTMS but didn't want any DRM. I wonder if Apple would go along with that or would Apple insist on DRM. Has anybody tried this? I'd be interested to know what Apple said. This would tell once and for all Apple's stance on the DRM issue.

  22. Fair vs. Fair by Opportunist · · Score: 3, Insightful

    I'm a fairly fair person. Treat me fairly, I treat you fairly.

    Is it fair to prevent me from enjoying my right of "fair use" by installing copy protection mechanisms that keep me from doing what I legally could do, but can't because I may not circumvent copyright protections?

    Is it fair to still charge a "copyright fee" on CD-Rs that I can ONLY use for writing content that I do have the copyright for anymore because of the forementioned copy protection mechanisms?

    Is it fair to install rootkits on my computer, without asking or at least informing me, without giving me the ability to get rid of them even if I cease using the product it came with?

    Is it fair to dictate what devices I can use to play the music I license?

    Is it fair to prevent me from copying content I do have the copyright of because the same copying mechanism could be used to copy content belonging to someone else?

    Is it fair to put pressure on politicians to tip the balance between producers and consumers more and more in the producers favor?

    Is it fair to assume that I don't give a rat's rear what someone treating me like that considers "fair"?

    Which question do you think would deserve a "yes" as an answer?

    --
    We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
  23. True colors shining through by Steve525 · · Score: 4, Insightful

    ... but this is simply going too far!

    I'm glad that the RIAA has made these statements. Before when their arguement for stronger copywrite protection was "Look at what Napster, Grokster, Kazaa, etc. are doing", they had an arguement that the politicians/judges could be sympathetic to. Now if their arguement is "Fair use; people don't need no stinking fair use," I don't think the politicians and judges are going to be as sympathetic. It doesn't necessarily mean they won't still get their way, but at least it's a lot easier to argue against them.

    Unfortunately, unlike you (if you are actually going to do what you claim) I don't think too many people care enough to do anything about it.

  24. Re:Big surprise by hattig · · Score: 4, Insightful

    All very true, but you're preaching to the converted.

    Instead tell your (if you are American) government to stop the RIAA riding roughshod all over you in the name of profit. Or do the equivalent in your area of the world.

    And start supporting unencumbered music not sold by RIAA members, and give artists money by seeing them live.

  25. Both culpable by Tony · · Score: 3, Insightful

    You are so right, my rights-oppressed friend. But *AAs are culpable for buying the laws; Congress is culpable for selling them.

    Both should be punished severely, and I'm not talking swatted across the bare backside by Mistress Trish in her beautiful leather attire, either. I'm talking Smite.

    I hate the business of politics.

    --
    Microsoft is to software what Budweiser is to beer.
  26. Re:Big surprise by msobkow · · Score: 4, Insightful

    The **AA has spent the past 20 years trying to change the rules. You used to be able to send back cassettes or albums for replacements when damaged; the only charge was shipping.

    Now they tell you it can't be replaced, because that version has been replaced by a "new" release, even with relatively-recently purchased media.

    Currently they're trying to cut it back further, so that it's not even legal for you to listen to your media on a portable device without paying yet again.

    To hell with the greedy bastards. Once or twice at the trough was more than enough -- no more.

    --
    I do not fail; I succeed at finding out what does not work.
  27. Re:Big surprise by toph42 · · Score: 5, Insightful

    Yes, and then they can cry about piracy causing a slump in CD sales and call for even more draconian "reforms." Copyrights were provided for in the Constitution as a neccesary evil, only to "promote the Progress of Science and useful Arts." When the copyright laws stifle rather than promote that progress, then they need to be repealed.

  28. Re:Death of an industry by lennart78 · · Score: 3, Insightful

    This is allready happening. Various 'aggregators' allow musicians and/or indie labels to publish music on iTunes and Rhapsody, against a hefty sum that is. Tunecore (http://www.tunecore.com/) offers the same, against much smaller costs.

    Record companies had 3 monopolies which allowed them to firmly control the recording industry:
    * To record an album you need a studio, which is expensive. Record companies paid band to use studios, tying the bands to the record company.
    * To publish an album, you need to put it on CD (or LP), and get it out to record stores (distribution). Both of these activities come with huge expenses upfront.
    * Finally, you need to promote and plug a band, which requires a network of people you know.

    Nowadays, as a musician, I can record decent quality productions at home with the aid of a computer, at a fraction of the costs it would take if I were to do it in a studio. Distribution can take place via the Internet, (e.g. Tunecore), and for promotion/plugging, web2.0 like community networks and a well designed website can get you somewhere.

    Basically, there is no more need for a record company. Their days are over, and the general public should realise that there are plenty possibilities to make do without them.

  29. Re:Big surprise by cayenne8 · · Score: 3, Insightful
    "With a CD, you are essentially limited to only playing it in a CD player. For the majority of consumers (particularly the biggest target market, Gen-Y), not a very good deal."

    Does no one any longer care about the loss of fidelity? I mean sure, a lossy format copy of music is great for a portable player in a gym or even in a car, a couple of the worst possible listening environments.

    but, for home use...would you not rather have the best possible sound in your better listening environment? I don't mean you have to spend tons of dollars on super high end audio, but, at least maximize the sound for your enviroment?

    On a slightly different note, I do like fairly high end stuff...but, it isn't like I built my system overnight. I've worked, saved and bought and replaced componets over many years. Do people just not know or care what really good sound reproduction is?

    --
    Light travels faster than sound. This is why some people appear bright until you hear them speak.........
  30. Yup... by Greyfox · · Score: 3, Insightful
    They're gearing up to do their best legally and technically to kill the secondhand CD market. I suspect that a lot of people now buy a CD, rip it and then sell it to a secondhand CD dealer. Lather, rinse, repeat. It's a lot safer than pulling your music off the Internet (No lawsuits) and cuts the RIAA out of all sales except for the first one for any given CD in that system.

    If you don't like it, write your local Congressman, point him at this story and tell him that you like your ipod and copyright issues are high on your priority list when you're considering who to vote for in the next election. Also don't buy CDs that benefit the RIAA. Go browse the International section of your local music store. Chances are you can find a lot of independent artists in there whose music is new and interesting and which cost half to a quarter what the latest RIAA produced crap does.

    --

    I'm trying to teach myself to set people on fire with my mind... Is it hot in here?

  31. Re:Big surprise by freedom_india · · Score: 5, Insightful
    If RIAA sells a media (a CD treated like a chair) then they have no FUCKIN right to tell me whether i resell it, rip it, or use it to wipe my ass if my toilet paper runs out.

    If they treat it as a license to listen to something (like Windows CDs), then they MUST replace a damaged CD.

    They can't have it both ways.

    Courts have ruled for past 150 years that the concept of reselling something is sacred. In other words if RIAA sells something to me, i have every right to make a second sale of it to someone i like. RIAA loses the right to dictate whether i can sell it or not once they have sold it to me.

    On the other hand, if they license it to me, then we ALL should send back Akon CDs to them (even perfectly good ones) and ask for replacement. That would bankrupts them.

    --
    "Doing what i can, with what i have." ~ Burt Gummer
  32. Re:Big surprise by maraist · · Score: 3, Insightful

    Why? Because if the music on iTMS doesn't have DRM, then it would be much easier for you to purchase music from iTMS and play it on any player out there.

    Right idea, wrong direction.

    It isn't that the music is selling the iPod, the iPod is selling the music. Apple is doing just fine w/ the iPod, DRM or not.. BUT, the clever part is that by having the iTunes player exclusively operate w/ their store-front, they have verticle integration. Similar to an MS platform. They can leverage one revenue stream against another.

    If apple didn't have DRM in two forms, one that an iPod player is tied to a PC, and that iTunes is tied to the player + PC, then it would be easy for someone to use non-iTunes software, thereby breaking the vertical integration.

    iTunes may or may not be lucrative (relative to profits from the iPod). But it's a stable platform of lock-in. Once you have $50 worth of iTunes (call it $25 of profit; less than the likely $100 of profit for a high-end iPod), then a person will be hesitant to throw all that away by moving to another PC software package (which doesn't support the DRM).

    Throw in gift certificates / parental allowances for music purchases etc, and your invested interest grows and grows until lockin is inevetable.

    Their store-front (visa v iTunes player) is like the AOL desktop of the 90's or IE/firefox toolbar or the google-task bar or of course the immensely lucrative stock windows desktop. It's real-estate as in central manhattan.

    --
    -Michael
  33. Re:Big surprise by Dunkirk · · Score: 5, Insightful

    No, no. That's the entire point of DRM. Piracy is a straw man. What person, having bought an iPod, and collected some music tracks, is going to say, screw it, I'm throwing away this investment, and going with some other service? No, they want to be able to access their whole collection on whatever device they have. That means they stay with an iPod, and with iTunes. It's classic Microsoftian tactics. DRM keeps people locked in APPLE'S DRM-ed vertical stack. That's EVERYONE'S strategy with DRM.

    --
    Acts 17:28, "For in Him we live, and move, and have our being."
  34. Re:Big surprise by mOdQuArK! · · Score: 5, Insightful
    They can't have it both ways.

    If they get the right laws passed, sure they can.

  35. Re:Death of an industry by AeroIllini · · Score: 3, Insightful

    Basically, there is no more need for a record company. Their days are over, and the general public should realise that there are plenty possibilities to make do without them.

    While I agree with your sentiment, that record companies in their current form are now obsolete, I would have to say that the days of the record companies in general are not over yet. However, their purpose and place in this business is quickly changing.

    Sure, you can do all that stuff yourself, recording on your home PC, publishing online, marketing through deli.cio.us or whoever. But that just gets you "good enough." In order to get a GREAT product, you really should use a professional recording studio with extremely high-end microphones, a professionally trained producer, and marketers who actually went to marketing school. All of that stuff is expensive, costing tens of thousands of dollars, and that's where the record company comes in.

    The record company should really be thought of as a venture capital firm for musicians. They front some money to the artist to pay for all the recording, producing, distribution, and marketing fees, and then the artist gives them a percentage of their earnings from that album in return. In other areas of venture capitalism, the risk is shared by both parties, the VC firm and the startup. If the idea is a flop, they BOTH lose money. However, in the last 30 years or so, the record companies have gotten so powerful that their cut of earnings has steadily gone up, and they started adding clauses about the band having to pay back all that up-front cost as well, with interest, out of their cut. The net result is that the record companies will sign just about anybody, because the deal is so one-sided that the band will go broke and declare bankruptcy long before the record companies ever lose money. They just sit back and get rich off other people's music, and this worked because they were the only game in town. It was either them or printing flyers and posting them on street corners.

    The next generation of record companies (and I am fairly sure a new generation is coming) will succeed because they will play nice. The deals they cut with the artists will be fair to both parties, the IP rights will be shared, and everyone will get rich if the band succeeds. When the risk is shared like that, there is pressure on the record company to only sign good bands that will be good long-term investments. The flavor-of-the-month approach only works when there's no risk to the record company, since there are 3 flops for every superstar. Signing bands with appeal AND musical talent is a long-term investment: the band will continue to grow and create more great music, develop a loyal following of fans, and be very visible. Marketers call that "building a brand"; musicians call it "fandom". Either way you look at it, it's good business: the record company has performers and albums they are proud of, the fans get better music on average, the musicians actually make money, and everyone gets to keep their soul. Good times.

    --
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  36. Re:CD price structure by phiwum · · Score: 4, Insightful

    The IP value of a CD (performer + composer + producer) is about $5...

    Fascinating. Now, how did you calculate that?

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  37. Re:Big surprise by TomRitchford · · Score: 3, Insightful

    "In that case stop driving a car, stop using the phone, stop using the internet, stop watching tv, stop using electricity, stop using heat, hell pretty much stop using just about everything you have.

    "By the /. definition, every company is a greedy bastard."

    What poor reasoning. "Because no company is perfect, it's pointless to criticize any of them." This is particularly stupid in this situation, where we do all have a perfectly good mechanism to bypass the record companies for the most part (p2p or just ripping your friend's CDs).

  38. Re:Big surprise by Grishnakh · · Score: 3, Insightful

    What the hell are you talking about?

    Car: I go to Honda and give them $20k or so, and they give me a nice car that's extremely reliable and fuel efficient. They also honor their warranty and repair the car when there's a problem during the first 5 years. The car works great for 10-15 years. What's the problem here? There's no blatant greediness; just a good product for a reasonable price.

    Internet: I pay $50 per month for my cable modem service, and it works just as advertised. The price hasn't changed in two years, and they haven't been trying to force me into paying more money for the same thing (yet). Just another simple business transaction.

    Electricity: Same as cable. I pay x cents per kilowatt-hour. The power stays on, I haven't had any brownouts or blackouts in 5 years since I moved here. What's the problem? This isn't greed, it's simple business. Provide a good service for a fair price.

    CDs: Buy a CD, and find out it isn't really a true CD, and doesn't play correctly. Try to return it and they won't accept it. Buy a normal CD and they tell you that the content isn't really yours, you can't resell it, but you can't use it the way you want either (on your iPod). So is it licensed or not? Neither; it's whatever way they'll make more money, even though this isn't actually backed up by any laws. This is greed, plain and simple, and it's evil.

    There's honest ways to earn money, and there's dishonest ways of taking money. The music industry is doing the latter.

  39. Re:Baloney. How did that get modded up? by Cl1mh4224rd · · Score: 3, Insightful
    . . .they don't come with reference materials like images, track listings, artist's notes, etc.
    How many real CDs come with anything more than half-assed attempt at these anyway? Considering the crushing heel of the RIAA, those incentives have lost their appeal for many people I imagine.
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