Exactly. As I said, it's an issue of their right vs. your freedom, and when both go up against the law, their right will typically win. This is my point. I am aware that it causes inconvenience. And, there are plenty of analogs to this: for example, the right to own property can impede your freedom to go anywhere you like.
Just because copying media for your own personal use (to use on your portable player or in your car, for instance) is legal, if the rightsholder doesn't want you to do this, it's their prerogative.
The good news is that the free market economy tends to take care of folks who put too many restrictions on their copyrighted works. I and many others refuse to buy CDs with copy protection, because they won't even work in one of my car's CD players. Music download services that have easy-to-live-with DRM (such as Apple's) will do better than services that do not.
Ultimately, DRM is a compromise that allows the widespread legal distribution of content. iTMS, Napster, and the rest would likely not exist if they hadn't been able to give a reasonable assurance to the rightsholders that their content would be protected to a certain degree. Sure, we can complain about DRM being inconvenient, but it sure beats the alternative.
"There is a bright line between stealing something (which makes that object unavailable for another person to purchase) and copying something (which does not)."
There's a good test for the relevancy of this argument: say you work hard on some software and put copy protection on it. You sell a thousand copies in a year and it allows you to pay your rent and feed your children. Then, the next year, you release another software program that is just as good, but pirates crack the copy protection, it's distributed widely on the P2P networks, and your sales fall by half. At that point, do your children (who need to be fed) or your landlord (who needs to be paid) care if your software was "stolen" or your rights were "infringed?"
"Is wholesale copyright infringement Wrong? Maybe. Is it anywhere near as wrong as the record companies' treatment of their talent? No way. I don't care to allow them to make a moral argument when their behavior is so blatantly immoral."
The problem here is that this argument can be used to justify lots of stuff. A programmer might be paid $50K for doing six months work on a game that grosses $2 million in sales. That's only 2.5% of the gross! The designer who created your car's look might get 0.1% of the car's gross sales. The engineer who assembled your PC might get 3% of its selling price. This is the rule, not the exception. CDs require the efforts of dozens, if not hundreds, of trained and talented people, and everybody gets a tiny piece of the pie -- the artist probably gets the biggest piece, when you consider that the rest goes toward the salaries of others who were integral in producing it.
"Let's look at the flip side of that. The music industry is, as is almost any other business, out for profit. The money made by such groups is only given to the artist at a factional amount. The "rich and famous" are a small portion of the artist whom we are "damaging." The price of a blank CD is c..10(us) at the most; the burning, labels, cases, leaflets, et al, is probably around 4 dollars a CD produced. These are then sold to Record stores at around 10-15 dollars (US) Then, the record stores sell them to us (the consumer)at 29-21 dollars (US)."
In addition to the inflated prices, you missed one step: the distribution channel. Record companies sell in to distribution for about $8 - $10. Even if you completely ignored all the costs unrelated to manufacturing (the cost of producing the CD itself, the advertising and promotion, and the allowances for returned merchandise and unsold inventory, $4 in media production costs yields a gross margin of about 50%. But, that is gross margin. Not net margin. That is a huge difference.
Record companies, in reality, have really shitty profit margins compared to lots of other businesses, and the recording industry is hugely speculative: some CDs make money, but many, if not most, are money-losers.
"The real thievery is put to the consumer with massive profit margins, from such a relatively cheap commodity. Why not download half, or more, of the music you listen to?"
There's nothing wrong with misunderstanding the true costs that go into producing a CD. But using this misunderstanding as a moral justification for piracy is a bit off the beam.
"DRM is not only taking away our freedom, it flawed by design as well."
Not to be trollish, but the ugly fact is that when one says "DRM takes away my freedom," it means "DRM takes away my freedom to violate somebody else's rights." "Rights" being the "R" in "DRM."
Unfortunately, today's laws say that only the rightsholders of a book, piece of software, or a piece of music have the right to say how it can be distributed. If a record company or an artist will only release their wares in a rights-managed format to protect their investment, that is, until the laws are changed, their prerogative.
Can DRM be inconvenient? Hell yes. But if it comes down to the creator's right to control how their work is distributed, vs. your "freedom" to ignore those rights, the law will usually fall on the side of the creator.
Anyway, what would change the music industry's stance on DRM is the success of a legal download service that offers DRM-less content. Launching such a service would require a huge leap of faith from the rightsholders, and it would also require that a significant portion of the subscribers to such a service follow the honor system and redistribute said content illegally. Unfortunately, the record industry has plenty of evidence (the widespread piracy on the P2P networks, for example) that the honor system does not often work well on the Internet.
As others pointed out, the legitimate music download services are operating in cooperation with, and not counter to, the record companies and artists. They are resellers of the record companies' products, just like Amazon or Tower Records. A sale is a sale.
Moreover, the lawsuits in the USA appear to be working. Europe has surpassed the USA in unauthorized music downloads, a large reason for this being that Kazaa usage in the US has dropped to half of what it once was. And, in case the point isn't already clear, I've spoken to a few people who work for the legitimate music download services, and they think the lawsuits are great. The theory is that they're scaring into buying music legitimately, whether that's via old-fashioned CD, or via a legal download. Traffic on the legal sites is apparently approaching the same order of magnitude as the P2P networks: Apple has announced that they've had 25 million downloads.
All of the above has been said before, so perhaps I can offer something that hasn't been brought up here on/., at least that I've seen: some historical perspective. The shift from CD to online distribution is one of but several media format changes that the recording industry has had to endure. I wasn't around for the move from 78's to LPs or for the explosion of the cassette tape format, but I was around for the transition from LPs to CDs, and if you think the wait for record companies and artists to adopt online distribution has been frustrating, be glad you weren't an early adopter of the CD format back in the early 80's. That, too, took years before everybody on the CD train. It started with CDs occupying just a tiny rack in a store of vinyl, and prices were regularly $16.95 and above -- in 1984 dollars. Even when CDs began to occupy a significant amount of shelf space, it was a regular practice for the record company to put out new releases in vinyl first, and not bother with a CD until months later, presumably after they'd seen whether the LP's sales were strong. For early adopters who couldn't wait to hear their favorite band's latest album, this meant buying the same music twice -- a factor which probably didn't exactly encourage the record companies to end their "release the CD format later" strategy!
It's because of this experience that the "Immediate death of the RIAA predicted, film at 11" type posts, written because the move to legal online distribution isn't happening as quickly as some people would like, don't carry much weight. Some industries simply move slowly and cautiously, and the record industry is one of them.
Lastly, can we finally dispense with that old "they're suing little girls!" straw man? I think we all know what happened: the RIAA named the person who was listed in the phone company records for that address, and for some reason, the mom had used her kid's name when signing up for phone service. This could happen to any of us: if, say, you had a dispute with a local business in your town and it got to the point that you had to take legal action, if the owner had registered the business in their kid's name, then you might be in that same embarrassing situation until things got sorted out.
"Music labels need to understand that the only way for them to discourage file (copyrighted music) sharing in a meaningful way is to offer people better, legitimate alternatives, not some half assed gimmick like this."
"Apple has demonstrated that when you give people the choice to buy music in the form they want, and at a reasonable way, people will buy. There are no gimmicks in their offering, and you simply pay for what you want."
I see this sentiment expressed a lot: "the record companies are dinosaurs! Apple has the right idea!". It's important to understand that Apple is a reseller. They developed iTMS with the cooperation and support of rightsholders, which included the record companies. Apple was not some rogue that pulled the rug out under an industry; iTMS as we have it today was the result of many months of close work between Apple and the labels.
The sales forces at the record companies are likely wetting themselves over the success of ventures like iTMS, Napster and the rest. Remember... a sale is a sale. I think they have figured it out.
"I'm just questioning your assertion that society is somehow violating the RIGHTS of artists."
That's the very context of "right" in the word "copyright." In today's society artists have the right to say who can do what with their work. If you violate copyright (by, say, downloading music without permission from the rightsholder) you are violating their rights. It's an ugly fact, but it's straightforward. Nobody wants to think of themselves as violating another person's rights, but that's what we do when we distribute copyrighted material without permission.
"Your examples are flawed and useless."
There was no editorializing done there... those are the countries which are not signatories to the Berne Convention. I was not "looking at poor countries" to be misleading. I didn't edit that list to serve my purpose. it's self-evident: countries which largely don't respect copyrights largely don't have much money. Whether these facts are related, and whether one is the cause of the other, or the other way around, is probably too complex of an issue to try to discuss here. But the list is the list, and their GNPs are easy to look up.
"Just using your example (of looking at the signatories of the Berne convention) doesn't show anything. I mean, many signatories probably don't enforce any of it (similar to many UN treaties)."
Hypothetically this theory could be correct, but the Berne Convention has been around for longer than you or I have, and you can be sure that signatories respect it and enforce its terms (which is why you don't see unfettered music piracy rings in, say, France). Any signatory caught ignoring it would have been nailed long, long ago. Interestingly, the USA was one of the last industrialized countries to sign it. Book publishers in the US were printing versions of books written by international authors without authorization, and signing the Berne Convention meant that they had to stop this.
"Nice idea, but somehow everyone stops on the first half."
Well put. I've also noticed that virtually everybody on Slashdot seems to be that exception... they would never pirate music simply to avoid paying for it.
If only that were the reality. Artists and record companies would be making money on an unprecedented level, and there would simply be no reason at all to sue music pirates.
Re:I DON'T CARE -- I BUY MUSIC LATELY
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Kazaa-lite Shut Down
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"And they provide 192kbit+ unencumbered mp3 files?"
What is your point? That the lack of MP3 content on the legal services gives you the moral imperative to pirate music?
Even in the waning days of 2003, two wrongs still don't make a right.
Re:Oh Well, there not the first, there not the las
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"I think Sharman will be in for a surprise once the find out that 75% of its 'users' were on the bootleged client."
They are aware of the high adoption rate of unauthorized versions of their client, which is exactly why they did this. Sharman is a for-profit business and relies on advertising revenues to survive. They're not getting ad revenue from the ad-free clients. Without ad revenue, they are history.
"It's pretty obvious, those users aren't coming back either."
It's a numbers game. They don't need them all back, but any percentage which do go back to the authorized client means more ad money in their pocket. Even if that's 1% or 5%.
Sharman has everything to gain and very little to lose by fighting the use of ad-free clients.
"Artists have given breakdowns of the economic side to siging with the RIAA. You give the copyrights of your music to the studio (look at CDs and notice that barely any from RIAA studios attribute any copyright to the artist)."
An important distinction: the copyright of the recording remains with the record company (and sometimes the engineer). The copyright on the words and music remains with the artist(s).
"The studio lends you money for studio time. The studio promotes the album and a subsequent tour. You raise money through ticket sales and CD/merchandies sales at the concerts. You use that money to pay off the original loan for studio time. Royalty payments go to the copyright owner, which is the studio, so the artists make very little."
Kinda. Record companies front the money to produce a CD (studio time and the like) and sell CDs to recoup this investment. Many, if not most, recording studios, are independent outfits. They are staffed by people like you and me who have families, and must pay rent and keep the lights on, which is why they charge for their time. Often this bill is paid for by the record company.
If a CD is profitable, both the record company and the artist win. If the CD is not profitable, the record company is SOL. They have not "loaned" production money to the artist in the sense that I might loan you $20 until payday.
"The business-smart artists create their own label, and sign other bands, because that's where the real money comes from."
...which is one reason why Metallica gets so upset when folks pirate their music: they own their own label, and they have more to lose.
Great quote from the Lawrence Lessig piece
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In support of the rights of the framers and users of the GPL:
"The issue is clear: Do you support the property rights that Congress gives the creators of software -- the right to decide to (1) sell your software, (2) license your software, or (3) give your software away. If you really do support that right, then you should support the particular choices property rights owners make with that right."
Now, if only more people thought that the above would still be true if "software" were replaced with "musical recording." Try (1) or (2) with a song, or put DRM on it, and (according to some slashdotters, at least) you're stabbing at the heart of freedom, and unworthy of that same support for your choice.
"Its society's job as a whole to decide the balance here, personally i think filesharing should be accepted and that it will lead to a positive change in the way things are done and the way music is made."
The problem here is that giving rights to one group (those who desire to have copyrighted material without requiring permission from the rightsholder) means taking rights away from another group (artists, poets, composers, writers, or anybody who would like to have a say in who can "share" their work).
Most societies respect the rights of artists and other copyright holders to have this say. The closest thing we have to international copyright law, the Berne Convention, has been adopted by most industrialized countries.
A society in which creators of art don't enjoy the rights they do today just might be the Utopia you describe. For clues, we can look at some of the countries which are not signatories to the Berne Convention: Afghanistan, Bhutan, Ethiopia, Iran, Iraq, Nepal, Oman, San Marino, Tonga and Yemen.
I don't know if any of those countries have thriving artistic communities where artists are free to create, unencumbered by the shameful desire for filthy lucre that has poisoned western society. But, relatively and generally speaking, those countries have no money. By comparison, the United States counts its collective intellectual property output as one of its biggest income generators, and we owe our high standard of living in part to the collective output of our country's programmers, musicians, novelists, and filmmakers.
I know I will draw the ire of many slashdotters by saying this, but if somebody goes to the trouble to write a program, or a book, or to write, record or produce a song, their right to say how it may be distributed supercedes my right to have it on my terms. It is they, and not me, who put in the effort to create it. If they have priced it out of my reach, I simply won't buy it, and if they've priced it too far out of enough people's reach, the free market economy will teach them that lesson. If I choose to pirate something, I'll admit that it's because I'm a cheap bastard, rather than some adopt some pseudo-altrustic "information wants to be free" stance or otherwise trying to convince myself that I'm somehow doing them a favor or that I'm committing some sort of social protest. Standing in front of a fucking tank or staging a sit-in at a lunch counter in Birmingham... now that's a social protest. Downloading a CD instead of buying it, when I know that somewhere there's somebody much like me who relies on CD sales to feed their family? That doesn't make me a hero.
"1. The collapse of the RIAA's scare-tactics business model for coercion to expensive copyright, and a change in how people listen and contribute to the music industry."
The RIAA's lawsuits (and by the way, there were more today) are symbiotic with, and not counter to, the growth in the legitimate download services. The RIAA's tactic is to scare people away from downloading copyrighted music without permission. The theory is that with greater awareness that doing so is illegal, and/or a fear of being caught, downloaders will migrate to legitimate sources, like iTMS, Napster, and the metric squillion others that have popped up.
So, "collapse" isn't the best word -- ideally, the need to resort to legal action will eventually evaporate.
"2. The total destruction of all online music sales, as all said businesses compete eachother out of existence."
The online music industry is like any other: some big players, some small players, some smart ones, some not-so-smart. It's been clearly shown that there's growing demand, so the industry will probably be around for some time to come.
"Why does the RIAA continue going after the little guy who doesn't have any money to give them for their file trading? Especially since some ISP's are trying to fight back for him/her. They managed to get blank CD's taxed because of the potential for copyright infringement, I'm suprised they haven't tried to put a tax on bandwidth for the potential copyright infringement that internet access offers."
You're talking about the tariff on blank music CDs in the United States? That largely goes to artists and performers, not record companies. Here are the details.
We see a couple of common schools of thought when it comes to music piracy: "Artists are poor and needy due to being abused by record companies; thus I have the moral right -- neigh, imperative to download music for free," and the polar opposite "Artists are greedy bastards. They have too much money. I know this, because I watched MTV Cribs once. Thus, I have the moral right... etc.". The issue of the tariff on blank music CDs in the US is a better argument for the latter school of thought than the former.
There is, of course, lots of stuff to get on the RIAA's case about, but the blank music CD tariff ain't one of them. Pick your villians carefully: this lies largely at the feets at the { greedy | needy } artists and performers -- or, more accurately speaking, the unions that represent them.
Anyway, to answer your first question, the RIAA's doing it to scare the hell out of people. Presumably, people who pirate music as an alternative to buying it will hear about these settlements and opt to buy CDs or go to legitimate download services instead.
"Music CDs are now "enhanced" to try to prevent people playing them on their computers; paid-for, downloaded music is now DRM-wrapped so it can't be burned to music CDs and played on home stereos or in cars."
But in this case, music purchased from iTMS can be burned to CD and played on home stereos and in cars.
Perhaps the question is "what specific problem does this hack address?". For practical purposes, the big one is:
iTMS users were prevented from taking the music they'd downloaded, and then distributing it freely and widely by e-mailing it to all their friends or posting it on Kazaa.
Are there any others? Is there something I'm missing? I'm aware that the iTunes software requires you to re-order your playlist after burning it ten times, but is downloading a DRM stripper really a better solution than just reordering your playlist?
For now, I'm siding with what some others have said: Apple has gone out of their way to create a usable, affordable service with easy-to-live-with DRM. Their success has hopefully helped convince rightsholders that online distribution can work. Apple doesn't deserve to be pissed on like this.
"However, if they must pay for the priveledge, doesn't this mean that permission must be obtained in some manner? Whether they obtain permission by paying for it, I'd think that permission still must be granted by some relevant party."
I know, it can be confusing. It's due to a phrase which you've probably seen tossed around in debates about music sharing... "compulsory licensing." In mediums where compulsory licensing occurs, such as radio, it means that you don't need to get permission from me to play the song I've recorded... if you compensate me in a pre-determined fashion. It works similarly for jukeboxes... if you own a bar with a jukebox, you can put whatever music you like in it -- indie, unsigned band, RIAA Big Five crap, etc. -- without first getting permission from anybody, but you do end up having to pay BMI/ASCAP.
From time to time people have advocated a similar sort of compulsory licensing for download services... particularly in the early days when the legitimate, paid download sites where having a heck of a time getting permission from skeptical copyright holders. A compulsory licensing system would have meant that a paid download service could put Madonna's music up whether she liked it or not, as long as they sent her a check.
Similar to this is compulsory royalties. If you're a singer, generally speaking, you need not get permission to record a cover version of a song and put it on your CD, as long as you pay them the mandated-by-law 7.1 cents per copy. Those 7.1 cents are the compulsory royalty.
Getting back to radio, there are certain exceptions to the "play what you like, just pay later" compulsory licensing scheme. For example, I believe it is still the case that a radio station can't just play an entire CD from beginning to end without prior arrangement. There may be other exceptions.
"Listening to the radio spew out song after song at no cost to me other than the time spent dealing with (listening to or avoiding) commercials, I hear no legal notices explaining that the songs were used with permission from the relevant parties. Stations have to pause periodically for identification. Perhaps it would clarify to the general public that the music is used with permission if they would pause from time to time in a similar manner to explain whose permission allowed them to play such music and to remind the public that the music is a tightly controlled resource."
Great post overall, but one clarification: radio stations generally need not get permission to play music (the instances where they must get permission is beyond the scope here). However, they do pay for the priveledge of playing the music. The money goes to ASCAP and BMI, two non-profit performance rights societies that distribute the money back to the composers. The record company does not get this money.
Also, your post may infer that the RIAA is the permission-giver for all music. For instances such as using a piece of music in a film, permission of the copyright holders must be obtained. The copyright holders can range from the record company to an engineer or two to the composer to the lyricist to the performer, but it's never the RIAA. The RIAA is a trade group that represents many but not all record companies. To that point, if I release a song on my own, or with the help of a record company that's not affiliated with the RIAA, I still get all the rights you've described above. Copyright law protects everybody.
"Close your eyes and imagine a world where music could be copied freely from one media to another without threat of lawsuit, digital rights mangement, unplayable CDs, etc... Is it so hard to do? Well it's STILL like that in most countries and it was that way in the US until recently."
For what it's worth, copyright laws have been to a large extent standardized internationally due to the Berne Convention. It's been around since 1886. The vast majority of developed nations are part of the union created by the Convention. The United States didn't become a signatory until more than a hundred years later, in 1989.
Some countries which haven't joined are Afghanistan, Bhutan, Ethiopia, Iran, Iraq, Nepal, Oman, San Marino, Tonga and Yemen.
You're obviously an intelligent person and it's been fun interacting with you, but please take the hyperbole down a notch.
"Bullshit the record companies have never competed on price, in fact they have been convicted of fixing prices. It is only with the introduction of P2P that any significant form of price competition."
Not what I said at all -- pricing something based on a supply/demand curve doesn't require tough competition -- it simply means that you'll make less money by pricing it lower (lower margins) or higher (lower sales). The auto industry is sort of the same way -- consumers expect an entry level sedan to be about $13,000.00, so the more successful auto companies have the luxury of not deviating too much from a standard price/feature set mix.
Agreed with you 100% though on piracy being a significant (and perhaps the first) significant form of price competition for the music industry. However, there are those who believe that music piracy actually helps the industry, as music pirates buy more CDs, and the music industry crash is not because of piracy but despite it.
Here's a quick rundown of what caused the price fixing bust a few years back:
The big-box retailers (read: Wal-Mart) and the the big electronics retailers (Best Buy, etc.) added CDs as a draw to get customers into the store. As they could make much more on the stuff in the back of the store, they started advertising CDs at prices at ridulously low margins.
Smaller retailers, including CD-only retailers that didn't have the luxury of selling other, high-markup items, complained to the record companies that they were driven out of business by Best Buy / Wal-Mart because they simply couldn't match prices.
In response, the record companies started adopting a strategy that's already used often in other channels: MAPs, or minimum advertised pricing. The theory was that Wal-Mart, Best Buy et al could sell all the CDs they wanted at low or negative margins, but they just couldn't advertise those prices, and as a result, pressure would be relieved from the smaller music-only retailers, the mom-and-pop stores, etc.
Wal-Mart and Best Buy threw an enormous hissy fit and went to the government. You know the rest of the story from here.
No obvious white hats or black hats there. Bottom line is that the consumer wins, so I guess that's all that counts.
As for the big label / small label / money-making thing, remember that Sony Music isn't just the Sony label -- it, like the rest of the Big Five, have a number of smaller subsidiary labels under which they publish the less mainstream stuff. The Big Five are Big because of their massive output of content, even if much of it is on obscure-sounding labels. I don't know what the net margins of smaller, indie (and thus not publicly traded) labels are, so I'll concede that they may make better margins than the big guys, but overall, the record industry is a low-margin business.
I am of the understanding that neither Sarah nor Ross paid money out of pocket as a result of these apparent mistakes. Is your understanding different?
The fact that the RIAA is using subpoenas, rather than, say, turning the evidence over to federal authorities, doesn't matter much in the case of a mistake. The feds make mistakes as well, and it can be just as much as an inconvenience for the hapless victim.
"BTW I don't think the RIAA is entitled to sue you for breach of copyright over anything they're not the copyright holders of, only the copyright holders have that right (responsibility?)."
The key phrases here are "authorized agent" and "power of attorney." It's a pretty simple process under the US legal system to allow somebody to act on your behalf in legal matters.
"I fully understand that audio recordings are the primary source of money for most artists, but still... The RIAA and the record labels seem to be taking a much larger profit than they should, especially compared to movies."
Just a clarification... the RIAA is a trade group representing the recording interests. They don't make money on a CD-by-CD basis.
Next, music is priced the way it is because this is a free market economy and anybody is allowed to sell anything at any price. Music prices have typically been at that sweet spot of the supply/demand curves. It's only relatively recently that the widespread availability of pirated music has upset those curves.
At any rate, remember that most CDs don't make money. It's the sales of the Britneys of the world which cover the expenses of producing and releasing less popular music. The recording industry is a very speculative game and despite the opinions of many slashdotters, net margins are typically quite low.
"And no, it's not some black and white issue of "she shared music, therefore she must be guilty because the law says so". For one thing, she's a minor."
Not sure where you're going here... do you think minors are, or should be, exempt from copyright law?
"For another, there is the concept of evidence, due process, etc, which seems to be entirely missing from the RIAA's current tactics. Oh wait, that would assume they're a law enforcement agency, which they most certainly aren't, even if they act like one."
The RIAA is following the due process. One does not need to be law enforcement to follow a process set down by law.
Also, after that embarrassing "Usher" incident wherein a university professor was sent a nastygram for having an MP3 in his directory that appeared to be a copyrighted song, you can be sure that the companies the RIAA uses to track offenders are double and triple checking their evidence. It is in their best interest to.
Slashdot Mirror
"But it does take away MY freedom of fair use."
Exactly. As I said, it's an issue of their right vs. your freedom, and when both go up against the law, their right will typically win. This is my point. I am aware that it causes inconvenience. And, there are plenty of analogs to this: for example, the right to own property can impede your freedom to go anywhere you like.
Just because copying media for your own personal use (to use on your portable player or in your car, for instance) is legal, if the rightsholder doesn't want you to do this, it's their prerogative.
The good news is that the free market economy tends to take care of folks who put too many restrictions on their copyrighted works. I and many others refuse to buy CDs with copy protection, because they won't even work in one of my car's CD players. Music download services that have easy-to-live-with DRM (such as Apple's) will do better than services that do not.
Ultimately, DRM is a compromise that allows the widespread legal distribution of content. iTMS, Napster, and the rest would likely not exist if they hadn't been able to give a reasonable assurance to the rightsholders that their content would be protected to a certain degree. Sure, we can complain about DRM being inconvenient, but it sure beats the alternative.
"There is a bright line between stealing something (which makes that object unavailable for another person to purchase) and copying something (which does not)."
There's a good test for the relevancy of this argument: say you work hard on some software and put copy protection on it. You sell a thousand copies in a year and it allows you to pay your rent and feed your children. Then, the next year, you release another software program that is just as good, but pirates crack the copy protection, it's distributed widely on the P2P networks, and your sales fall by half. At that point, do your children (who need to be fed) or your landlord (who needs to be paid) care if your software was "stolen" or your rights were "infringed?"
"Is wholesale copyright infringement Wrong? Maybe. Is it anywhere near as wrong as the record companies' treatment of their talent? No way. I don't care to allow them to make a moral argument when their behavior is so blatantly immoral."
The problem here is that this argument can be used to justify lots of stuff. A programmer might be paid $50K for doing six months work on a game that grosses $2 million in sales. That's only 2.5% of the gross! The designer who created your car's look might get 0.1% of the car's gross sales. The engineer who assembled your PC might get 3% of its selling price. This is the rule, not the exception. CDs require the efforts of dozens, if not hundreds, of trained and talented people, and everybody gets a tiny piece of the pie -- the artist probably gets the biggest piece, when you consider that the rest goes toward the salaries of others who were integral in producing it.
"Let's look at the flip side of that. The music industry is, as is almost any other business, out for profit. The money made by such groups is only given to the artist at a factional amount. The "rich and famous" are a small portion of the artist whom we are "damaging." The price of a blank CD is c. .10(us) at the most; the burning, labels, cases, leaflets, et al, is probably around 4 dollars a CD produced. These are then sold to Record stores at around 10-15 dollars (US) Then, the record stores sell them to us (the consumer)at 29-21 dollars (US)."
In addition to the inflated prices, you missed one step: the distribution channel. Record companies sell in to distribution for about $8 - $10. Even if you completely ignored all the costs unrelated to manufacturing (the cost of producing the CD itself, the advertising and promotion, and the allowances for returned merchandise and unsold inventory, $4 in media production costs yields a gross margin of about 50%. But, that is gross margin. Not net margin. That is a huge difference.
Record companies, in reality, have really shitty profit margins compared to lots of other businesses, and the recording industry is hugely speculative: some CDs make money, but many, if not most, are money-losers.
"The real thievery is put to the consumer with massive profit margins, from such a relatively cheap commodity. Why not download half, or more, of the music you listen to?"
There's nothing wrong with misunderstanding the true costs that go into producing a CD. But using this misunderstanding as a moral justification for piracy is a bit off the beam.
"DRM is not only taking away our freedom, it flawed by design as well."
Not to be trollish, but the ugly fact is that when one says "DRM takes away my freedom," it means "DRM takes away my freedom to violate somebody else's rights." "Rights" being the "R" in "DRM."
Unfortunately, today's laws say that only the rightsholders of a book, piece of software, or a piece of music have the right to say how it can be distributed. If a record company or an artist will only release their wares in a rights-managed format to protect their investment, that is, until the laws are changed, their prerogative.
Can DRM be inconvenient? Hell yes. But if it comes down to the creator's right to control how their work is distributed, vs. your "freedom" to ignore those rights, the law will usually fall on the side of the creator.
Anyway, what would change the music industry's stance on DRM is the success of a legal download service that offers DRM-less content. Launching such a service would require a huge leap of faith from the rightsholders, and it would also require that a significant portion of the subscribers to such a service follow the honor system and redistribute said content illegally. Unfortunately, the record industry has plenty of evidence (the widespread piracy on the P2P networks, for example) that the honor system does not often work well on the Internet.
As others pointed out, the legitimate music download services are operating in cooperation with, and not counter to, the record companies and artists. They are resellers of the record companies' products, just like Amazon or Tower Records. A sale is a sale.
Moreover, the lawsuits in the USA appear to be working. Europe has surpassed the USA in unauthorized music downloads, a large reason for this being that Kazaa usage in the US has dropped to half of what it once was. And, in case the point isn't already clear, I've spoken to a few people who work for the legitimate music download services, and they think the lawsuits are great. The theory is that they're scaring into buying music legitimately, whether that's via old-fashioned CD, or via a legal download. Traffic on the legal sites is apparently approaching the same order of magnitude as the P2P networks: Apple has announced that they've had 25 million downloads.
All of the above has been said before, so perhaps I can offer something that hasn't been brought up here on /., at least that I've seen: some historical perspective. The shift from CD to online distribution is one of but several media format changes that the recording industry has had to endure. I wasn't around for the move from 78's to LPs or for the explosion of the cassette tape format, but I was around for the transition from LPs to CDs, and if you think the wait for record companies and artists to adopt online distribution has been frustrating, be glad you weren't an early adopter of the CD format back in the early 80's. That, too, took years before everybody on the CD train. It started with CDs occupying just a tiny rack in a store of vinyl, and prices were regularly $16.95 and above -- in 1984 dollars. Even when CDs began to occupy a significant amount of shelf space, it was a regular practice for the record company to put out new releases in vinyl first, and not bother with a CD until months later, presumably after they'd seen whether the LP's sales were strong. For early adopters who couldn't wait to hear their favorite band's latest album, this meant buying the same music twice -- a factor which probably didn't exactly encourage the record companies to end their "release the CD format later" strategy!
It's because of this experience that the "Immediate death of the RIAA predicted, film at 11" type posts, written because the move to legal online distribution isn't happening as quickly as some people would like, don't carry much weight. Some industries simply move slowly and cautiously, and the record industry is one of them.
Lastly, can we finally dispense with that old "they're suing little girls!" straw man? I think we all know what happened: the RIAA named the person who was listed in the phone company records for that address, and for some reason, the mom had used her kid's name when signing up for phone service. This could happen to any of us: if, say, you had a dispute with a local business in your town and it got to the point that you had to take legal action, if the owner had registered the business in their kid's name, then you might be in that same embarrassing situation until things got sorted out.
"Music labels need to understand that the only way for them to discourage file (copyrighted music) sharing in a meaningful way is to offer people better, legitimate alternatives, not some half assed gimmick like this."
"Apple has demonstrated that when you give people the choice to buy music in the form they want, and at a reasonable way, people will buy. There are no gimmicks in their offering, and you simply pay for what you want."
I see this sentiment expressed a lot: "the record companies are dinosaurs! Apple has the right idea!". It's important to understand that Apple is a reseller. They developed iTMS with the cooperation and support of rightsholders, which included the record companies. Apple was not some rogue that pulled the rug out under an industry; iTMS as we have it today was the result of many months of close work between Apple and the labels.
The sales forces at the record companies are likely wetting themselves over the success of ventures like iTMS, Napster and the rest. Remember... a sale is a sale. I think they have figured it out.
"I'm just questioning your assertion that society is somehow violating the RIGHTS of artists."
That's the very context of "right" in the word "copyright." In today's society artists have the right to say who can do what with their work. If you violate copyright (by, say, downloading music without permission from the rightsholder) you are violating their rights. It's an ugly fact, but it's straightforward. Nobody wants to think of themselves as violating another person's rights, but that's what we do when we distribute copyrighted material without permission.
"Your examples are flawed and useless."
There was no editorializing done there... those are the countries which are not signatories to the Berne Convention. I was not "looking at poor countries" to be misleading. I didn't edit that list to serve my purpose. it's self-evident: countries which largely don't respect copyrights largely don't have much money. Whether these facts are related, and whether one is the cause of the other, or the other way around, is probably too complex of an issue to try to discuss here. But the list is the list, and their GNPs are easy to look up.
"Just using your example (of looking at the signatories of the Berne convention) doesn't show anything. I mean, many signatories probably don't enforce any of it (similar to many UN treaties)."
Hypothetically this theory could be correct, but the Berne Convention has been around for longer than you or I have, and you can be sure that signatories respect it and enforce its terms (which is why you don't see unfettered music piracy rings in, say, France). Any signatory caught ignoring it would have been nailed long, long ago. Interestingly, the USA was one of the last industrialized countries to sign it. Book publishers in the US were printing versions of books written by international authors without authorization, and signing the Berne Convention meant that they had to stop this.
"Nice idea, but somehow everyone stops on the first half."
Well put. I've also noticed that virtually everybody on Slashdot seems to be that exception... they would never pirate music simply to avoid paying for it.
If only that were the reality. Artists and record companies would be making money on an unprecedented level, and there would simply be no reason at all to sue music pirates.
"And they provide 192kbit+ unencumbered mp3 files?"
What is your point? That the lack of MP3 content on the legal services gives you the moral imperative to pirate music?
Even in the waning days of 2003, two wrongs still don't make a right.
"I think Sharman will be in for a surprise once the find out that 75% of its 'users' were on the bootleged client."
They are aware of the high adoption rate of unauthorized versions of their client, which is exactly why they did this. Sharman is a for-profit business and relies on advertising revenues to survive. They're not getting ad revenue from the ad-free clients. Without ad revenue, they are history.
"It's pretty obvious, those users aren't coming back either."
It's a numbers game. They don't need them all back, but any percentage which do go back to the authorized client means more ad money in their pocket. Even if that's 1% or 5%.
Sharman has everything to gain and very little to lose by fighting the use of ad-free clients.
"Artists have given breakdowns of the economic side to siging with the RIAA. You give the copyrights of your music to the studio (look at CDs and notice that barely any from RIAA studios attribute any copyright to the artist)."
An important distinction: the copyright of the recording remains with the record company (and sometimes the engineer). The copyright on the words and music remains with the artist(s).
"The studio lends you money for studio time. The studio promotes the album and a subsequent tour. You raise money through ticket sales and CD/merchandies sales at the concerts. You use that money to pay off the original loan for studio time. Royalty payments go to the copyright owner, which is the studio, so the artists make very little."
Kinda. Record companies front the money to produce a CD (studio time and the like) and sell CDs to recoup this investment. Many, if not most, recording studios, are independent outfits. They are staffed by people like you and me who have families, and must pay rent and keep the lights on, which is why they charge for their time. Often this bill is paid for by the record company.
If a CD is profitable, both the record company and the artist win. If the CD is not profitable, the record company is SOL. They have not "loaned" production money to the artist in the sense that I might loan you $20 until payday.
"The business-smart artists create their own label, and sign other bands, because that's where the real money comes from."
...which is one reason why Metallica gets so upset when folks pirate their music: they own their own label, and they have more to lose.
In support of the rights of the framers and users of the GPL:
"The issue is clear: Do you support the property rights that Congress gives the creators of software -- the right to decide to (1) sell your software, (2) license your software, or (3) give your software away. If you really do support that right, then you should support the particular choices property rights owners make with that right."
Now, if only more people thought that the above would still be true if "software" were replaced with "musical recording." Try (1) or (2) with a song, or put DRM on it, and (according to some slashdotters, at least) you're stabbing at the heart of freedom, and unworthy of that same support for your choice.
"Its society's job as a whole to decide the balance here, personally i think filesharing should be accepted and that it will lead to a positive change in the way things are done and the way music is made."
The problem here is that giving rights to one group (those who desire to have copyrighted material without requiring permission from the rightsholder) means taking rights away from another group (artists, poets, composers, writers, or anybody who would like to have a say in who can "share" their work).
Most societies respect the rights of artists and other copyright holders to have this say. The closest thing we have to international copyright law, the Berne Convention, has been adopted by most industrialized countries.
A society in which creators of art don't enjoy the rights they do today just might be the Utopia you describe. For clues, we can look at some of the countries which are not signatories to the Berne Convention: Afghanistan, Bhutan, Ethiopia, Iran, Iraq, Nepal, Oman, San Marino, Tonga and Yemen.
I don't know if any of those countries have thriving artistic communities where artists are free to create, unencumbered by the shameful desire for filthy lucre that has poisoned western society. But, relatively and generally speaking, those countries have no money. By comparison, the United States counts its collective intellectual property output as one of its biggest income generators, and we owe our high standard of living in part to the collective output of our country's programmers, musicians, novelists, and filmmakers.
I know I will draw the ire of many slashdotters by saying this, but if somebody goes to the trouble to write a program, or a book, or to write, record or produce a song, their right to say how it may be distributed supercedes my right to have it on my terms. It is they, and not me, who put in the effort to create it. If they have priced it out of my reach, I simply won't buy it, and if they've priced it too far out of enough people's reach, the free market economy will teach them that lesson. If I choose to pirate something, I'll admit that it's because I'm a cheap bastard, rather than some adopt some pseudo-altrustic "information wants to be free" stance or otherwise trying to convince myself that I'm somehow doing them a favor or that I'm committing some sort of social protest. Standing in front of a fucking tank or staging a sit-in at a lunch counter in Birmingham... now that's a social protest. Downloading a CD instead of buying it, when I know that somewhere there's somebody much like me who relies on CD sales to feed their family? That doesn't make me a hero.
Sorta. This should settle it.
"1. The collapse of the RIAA's scare-tactics business model for coercion to expensive copyright, and a change in how people listen and contribute to the music industry."
The RIAA's lawsuits (and by the way, there were more today) are symbiotic with, and not counter to, the growth in the legitimate download services. The RIAA's tactic is to scare people away from downloading copyrighted music without permission. The theory is that with greater awareness that doing so is illegal, and/or a fear of being caught, downloaders will migrate to legitimate sources, like iTMS, Napster, and the metric squillion others that have popped up.
So, "collapse" isn't the best word -- ideally, the need to resort to legal action will eventually evaporate.
"2. The total destruction of all online music sales, as all said businesses compete eachother out of existence."
The online music industry is like any other: some big players, some small players, some smart ones, some not-so-smart. It's been clearly shown that there's growing demand, so the industry will probably be around for some time to come.
"Why does the RIAA continue going after the little guy who doesn't have any money to give them for their file trading? Especially since some ISP's are trying to fight back for him/her. They managed to get blank CD's taxed because of the potential for copyright infringement, I'm suprised they haven't tried to put a tax on bandwidth for the potential copyright infringement that internet access offers."
You're talking about the tariff on blank music CDs in the United States? That largely goes to artists and performers, not record companies. Here are the details.
We see a couple of common schools of thought when it comes to music piracy: "Artists are poor and needy due to being abused by record companies; thus I have the moral right -- neigh, imperative to download music for free," and the polar opposite "Artists are greedy bastards. They have too much money. I know this, because I watched MTV Cribs once. Thus, I have the moral right... etc.". The issue of the tariff on blank music CDs in the US is a better argument for the latter school of thought than the former.
There is, of course, lots of stuff to get on the RIAA's case about, but the blank music CD tariff ain't one of them. Pick your villians carefully: this lies largely at the feets at the { greedy | needy } artists and performers -- or, more accurately speaking, the unions that represent them.
Anyway, to answer your first question, the RIAA's doing it to scare the hell out of people. Presumably, people who pirate music as an alternative to buying it will hear about these settlements and opt to buy CDs or go to legitimate download services instead.
"Music CDs are now "enhanced" to try to prevent people playing them on their computers; paid-for, downloaded music is now DRM-wrapped so it can't be burned to music CDs and played on home stereos or in cars."
But in this case, music purchased from iTMS can be burned to CD and played on home stereos and in cars.
Perhaps the question is "what specific problem does this hack address?". For practical purposes, the big one is:
Are there any others? Is there something I'm missing? I'm aware that the iTunes software requires you to re-order your playlist after burning it ten times, but is downloading a DRM stripper really a better solution than just reordering your playlist?
For now, I'm siding with what some others have said: Apple has gone out of their way to create a usable, affordable service with easy-to-live-with DRM. Their success has hopefully helped convince rightsholders that online distribution can work. Apple doesn't deserve to be pissed on like this.
"However, if they must pay for the priveledge, doesn't this mean that permission must be obtained in some manner? Whether they obtain permission by paying for it, I'd think that permission still must be granted by some relevant party."
I know, it can be confusing. It's due to a phrase which you've probably seen tossed around in debates about music sharing... "compulsory licensing." In mediums where compulsory licensing occurs, such as radio, it means that you don't need to get permission from me to play the song I've recorded... if you compensate me in a pre-determined fashion. It works similarly for jukeboxes... if you own a bar with a jukebox, you can put whatever music you like in it -- indie, unsigned band, RIAA Big Five crap, etc. -- without first getting permission from anybody, but you do end up having to pay BMI/ASCAP.
From time to time people have advocated a similar sort of compulsory licensing for download services... particularly in the early days when the legitimate, paid download sites where having a heck of a time getting permission from skeptical copyright holders. A compulsory licensing system would have meant that a paid download service could put Madonna's music up whether she liked it or not, as long as they sent her a check.
Similar to this is compulsory royalties. If you're a singer, generally speaking, you need not get permission to record a cover version of a song and put it on your CD, as long as you pay them the mandated-by-law 7.1 cents per copy. Those 7.1 cents are the compulsory royalty.
Getting back to radio, there are certain exceptions to the "play what you like, just pay later" compulsory licensing scheme. For example, I believe it is still the case that a radio station can't just play an entire CD from beginning to end without prior arrangement. There may be other exceptions.
"Listening to the radio spew out song after song at no cost to me other than the time spent dealing with (listening to or avoiding) commercials, I hear no legal notices explaining that the songs were used with permission from the relevant parties. Stations have to pause periodically for identification. Perhaps it would clarify to the general public that the music is used with permission if they would pause from time to time in a similar manner to explain whose permission allowed them to play such music and to remind the public that the music is a tightly controlled resource."
Great post overall, but one clarification: radio stations generally need not get permission to play music (the instances where they must get permission is beyond the scope here). However, they do pay for the priveledge of playing the music. The money goes to ASCAP and BMI, two non-profit performance rights societies that distribute the money back to the composers. The record company does not get this money.
Also, your post may infer that the RIAA is the permission-giver for all music. For instances such as using a piece of music in a film, permission of the copyright holders must be obtained. The copyright holders can range from the record company to an engineer or two to the composer to the lyricist to the performer, but it's never the RIAA. The RIAA is a trade group that represents many but not all record companies. To that point, if I release a song on my own, or with the help of a record company that's not affiliated with the RIAA, I still get all the rights you've described above. Copyright law protects everybody.
"Close your eyes and imagine a world where music could be copied freely from one media to another without threat of lawsuit, digital rights mangement, unplayable CDs, etc... Is it so hard to do? Well it's STILL like that in most countries and it was that way in the US until recently."
For what it's worth, copyright laws have been to a large extent standardized internationally due to the Berne Convention. It's been around since 1886. The vast majority of developed nations are part of the union created by the Convention. The United States didn't become a signatory until more than a hundred years later, in 1989.
Some countries which haven't joined are Afghanistan, Bhutan, Ethiopia, Iran, Iraq, Nepal, Oman, San Marino, Tonga and Yemen.
You're obviously an intelligent person and it's been fun interacting with you, but please take the hyperbole down a notch.
"Bullshit the record companies have never competed on price, in fact they have been convicted of fixing prices. It is only with the introduction of P2P that any significant form of price competition."
Not what I said at all -- pricing something based on a supply/demand curve doesn't require tough competition -- it simply means that you'll make less money by pricing it lower (lower margins) or higher (lower sales). The auto industry is sort of the same way -- consumers expect an entry level sedan to be about $13,000.00, so the more successful auto companies have the luxury of not deviating too much from a standard price/feature set mix.
Agreed with you 100% though on piracy being a significant (and perhaps the first) significant form of price competition for the music industry. However, there are those who believe that music piracy actually helps the industry, as music pirates buy more CDs, and the music industry crash is not because of piracy but despite it.
Here's a quick rundown of what caused the price fixing bust a few years back:
No obvious white hats or black hats there. Bottom line is that the consumer wins, so I guess that's all that counts.
As for the big label / small label / money-making thing, remember that Sony Music isn't just the Sony label -- it, like the rest of the Big Five, have a number of smaller subsidiary labels under which they publish the less mainstream stuff. The Big Five are Big because of their massive output of content, even if much of it is on obscure-sounding labels. I don't know what the net margins of smaller, indie (and thus not publicly traded) labels are, so I'll concede that they may make better margins than the big guys, but overall, the record industry is a low-margin business.
I am of the understanding that neither Sarah nor Ross paid money out of pocket as a result of these apparent mistakes. Is your understanding different?
The fact that the RIAA is using subpoenas, rather than, say, turning the evidence over to federal authorities, doesn't matter much in the case of a mistake. The feds make mistakes as well, and it can be just as much as an inconvenience for the hapless victim.
"BTW I don't think the RIAA is entitled to sue you for breach of copyright over anything they're not the copyright holders of, only the copyright holders have that right (responsibility?)."
The key phrases here are "authorized agent" and "power of attorney." It's a pretty simple process under the US legal system to allow somebody to act on your behalf in legal matters.
"I fully understand that audio recordings are the primary source of money for most artists, but still... The RIAA and the record labels seem to be taking a much larger profit than they should, especially compared to movies."
Just a clarification... the RIAA is a trade group representing the recording interests. They don't make money on a CD-by-CD basis.
Next, music is priced the way it is because this is a free market economy and anybody is allowed to sell anything at any price. Music prices have typically been at that sweet spot of the supply/demand curves. It's only relatively recently that the widespread availability of pirated music has upset those curves.
At any rate, remember that most CDs don't make money. It's the sales of the Britneys of the world which cover the expenses of producing and releasing less popular music. The recording industry is a very speculative game and despite the opinions of many slashdotters, net margins are typically quite low.
"And no, it's not some black and white issue of "she shared music, therefore she must be guilty because the law says so". For one thing, she's a minor."
Not sure where you're going here... do you think minors are, or should be, exempt from copyright law?
"For another, there is the concept of evidence, due process, etc, which seems to be entirely missing from the RIAA's current tactics. Oh wait, that would assume they're a law enforcement agency, which they most certainly aren't, even if they act like one."
The RIAA is following the due process. One does not need to be law enforcement to follow a process set down by law.
Also, after that embarrassing "Usher" incident wherein a university professor was sent a nastygram for having an MP3 in his directory that appeared to be a copyrighted song, you can be sure that the companies the RIAA uses to track offenders are double and triple checking their evidence. It is in their best interest to.