stories about: "riaa"
Say That Again

Say That Again

by Mike Masnick


Filed Under:
cary sherman, copyright, dmca

Companies:
riaa



RIAA Boss Says That The DMCA 'Isn't Working' Any More

from the um..-wow. dept

RIAA President Cary Sherman is really doing a stunning job every time he opens his mouth this week. First, as noted earlier, he may have hurt the RIAA's chances in a Supreme Court case by directly stating the exact opposite of the RIAA's position in that case. Then, he got on stage at a "tech policy" shindig in Aspen Colorado, and said (apparently with a straight face) that "the DMCA isn't working for content people at all." Wow.

Now, this deserves some background. The key parts of the DMCA were almost entirely drafted due to pressures from the RIAA, who wanted this law passed badly. The RIAA has been one of the biggest supporters of the DMCA all along. The one tiny bit they don't like was the part put in at the request of service providers to get them to stop fighting the DMCA: a basic safe harbor that makes it clear that liability should only be applied to individuals or organizations who actually infringe on copyrights, not service providers whose tools are used by third parties. This isn't some revolutionary idea. It's basic common sense application of liability on the party that actually breaks the law. Even that was severely tilted in the RIAA's favor by requiring a notice-and-takedown provision, that almost certainly violates the First Amendment.

But much of the DMCA was an RIAA wishlist of the absurd -- such as the anti-circumvention clause. In fact, for years, tech companies warned about problems with the DMCA. There were a few attempts by Rep. Rick Boucher to reform the DMCA to get rid of the serious problems with it that totally favored the RIAA in often ridiculous ways, but the entertainment industry vigorously fought against these changes.

However, nothing ever came of that, and Boucher hasn't pushed to reform the DMCA in quite a few years at this point. Last I heard, the feeling was that both the technology folks and the entertainment industry folks had decided that reopening the DMCA was a can of worms that was far too dangerous. Tech companies feared losing the safe harbor protections, while the entertainment industry feared losing pretty much anything, such as some of the anti-circumvention clauses.

However, with the entertainment industry having such a "good friend" in Joe Biden, it apparently feels confident enough to try to reopen the DMCA to get rid of the one part it never liked. This is really quite stunning. The DMCA was a bill that was designed for the RIAA. It had one tiny safe harbor, and for Sherman to now attack that is a sickening attempt to twist the DMCA even further in favor of one industry, against everyone's best interests.

Even worse, his rationale for this is just laughable:

"You cannot monitor all the infringements on the Internet. It's simply not possible. We don't have the ability to search all the places infringing content appears, such as cyberlockers like [file-hosting firm] RapidShare."
Read that again. So because the RIAA is unable to monitor, others should be forced to do it for them, or face giant fines. Sherman admits that it's impossible to monitor, but in the same breath demands laws that will punish other companies for failing to do the impossible, while taking all of the responsibility off of the companies he represents. To make such a statement takes such incredible guts that it's amazing the room didn't burst out in laughter.

Of course, what this is really about is that Sherman and the RIAA are posturing for a three strikes law in the US. For two years now, they've tried (and failed) to get ISPs to agree to three strikes in the US. So, Sherman is kicking off a campaign to try to pressure ISPs to agree... or to get politicians to introduce a bill.

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Copyright

Copyright

by Mike Masnick


Filed Under:
cary sherman, copyright, innocent infringement, supreme court, whitney harper

Companies:
riaa



Did The RIAA Just Destroy Its Own Argument Concerning Innocent Infringement?

from the whooops dept

We just saw that amicus briefs are being filed over whether or not the Supreme Court should hear the case concerning whether or not an "innocent infringement" defense is a legitimate defense to an RIAA file sharing lawsuit. If you don't recall, a district court found that a teenager's claim of "innocent infringement" -- which knocks the potential statutory minimum down from $750 to $200 -- was a legitimate defense. An appeals court overturned the ruling, and said that the girl, Whitney Harper, should have known that downloading music was infringing because any CD has a copyright notice (even though she never saw the CDs of the music she downloaded).

I have no idea if the Supreme Court will take the case, but the JoelFightsBack website is pointing out that RIAA boss Cary Sherman, in a recent interview, appears to have undermined the industry's own claims in a recent interview with Vice magazine:

The time had come to shift over to a strategy that would be more effective. The lawsuits were obviously controversial in the media, but the reality was that most people had no idea that what they were doing was illegal at the time of those lawsuits. We did all sorts of surveys. We tried PR firms. We did everything to look at how to begin to change the culture of using illegal P2P. We realized that 1) none of the messages resonated, and 2) most people had no idea that what they were doing was illegal, let alone thought it was wrong. That completely flipped overnight when we started the lawsuits. It made an enormous impression and we were constantly generating dinner conversations about what you may or may not do with your computer. We think it would be very good if there were more such conversations about all the other things that can be done inappropriately with a computer. So we think it had a tremendous impact by very clearly searing in the minds of the public that maybe getting all of this stuff for free isn't legal after all.
That seems to undermine the claims that of course people knew it was illegal, doesn't it? Not surprisingly, the Sherman interview is chock full of other bizarre statements. Even just this one little quote is pretty funny with him trying to somehow redefine the lawsuits as a successful PR strategy. Of course, if they were actually successful in educating people, then wouldn't there be fewer people accessing unauthorized music today than when they started? Of course, the exact opposite is true. The rest of the article is filled with similarly laughable attempts by Sherman to pretend that the RIAA's strategy over the past decade has been successful, rather than a complete disaster that has helped the major record labels speed up their own demise.

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Copyright

Copyright

by Mike Masnick


Filed Under:
child porn, copyright, net neutrality, recording industry

Companies:
a2im, afm, aftra, ascap, bmi, nmpa, riaa, sesac, soundexchange



Recording Industry Using Net Neutrality Debate To Try To Link Child Porn With Copyright Infringement Again

from the it's-not-the-same dept

We've already seen how music industry execs and lobbyists cynically use "child porn" to their advantage (even, sickeningly, declaring "child porn is great") by lumping it in with copyright infringement in trying to force filters or other third party policing of the internet on politicians and companies. What's amazing is that they don't seem to have any shame at all in doing so. The latest example can be found in the "open letter" put together by a bunch of music industry trade groups (RIAA, A2IM, AFM, AFTRA, ASCAP, BMI, NMPA, SESAC, SoundExchange, the Recording Academy, the California Songwriters Association, the Music Managers Forum, and the Nashville Songwriters Association International) to Verizon and Google asking them to make sure their proposed "framework" for net neutrality still doesn't cover forcing ISPs to be copyright cops. It's no surprise why they sent this letter, but the inclusion of "child porn" with copyright infringement is really ridiculous:

The music community we represent believes it is vital that any Internet policy initiative permit and encourage ISPs and other intermediaries to take measures to deter unlawful activity such as copyright infringement and child pornography.
The industry seems to work overtime to try to link these two concepts together, despite the vast differences between them. It's really an incredibly cynical, exploitative and disgusting move by the recording industry, and people should really start calling them on it.

38 Comments | Leave a Comment..

 
Politics

Politics

by Mike Masnick


Filed Under:
deals, fm radio, performance rights, performance tax, radio

Companies:
nab, riaa



Will The NAB Agree To A Performance Rights Tax In Exchange For Having RIAA Support Mandatory FM Radio In Mobile Phones?

from the rearranging-deck-chairs dept

We've discussed, for quite some time now, the ridiculousness of a performance rights tax on radio. This is the attempt, by the record labels, to get radio stations to pay performers for advertising and promoting their music. This is clearly not needed, because in the real world, without this, record labels already know that radio play is valuable: it's why they keep running payola scams. For them to try to then legally mandate that money should flow in the opposite direction is downright ridiculous. In what world does the government make someone pay to promote someone else?

After years and years fighting this, we should have known that the NAB would come up with some ridiculous idea in the end. The NAB, which represents broadcasters, is almost always on the wrong side of policy debates (that's what happens when your job is to protect a dying industry), but on this one issue we agreed... until now. Rumors are circulating that the NAB is willing to cave on performance rights, if the RIAA, in exchange, supports a totally wasteful plan to require FM radio receivers be placed in mobile phones, MP3 players and other digital devices. Now, everyone involved says no deal is done yet, but there are multiple indications that this is exactly where the conversation is heading.

The NAB tries to defend this by comparing FM radio -- a dying technology -- to federal mandates on digital television tuners. That, of course, was entirely different in so many ways. It involved attempts to move the country forward to a new technology, not mandating an obsolete one. It also was done for a very specific reason: to try to recapture tons of valuable spectrum that could be put to much more valuable and practical use. Mandating FM tuners is just a waste of time and money in a quixotic attempt by broadcasters to prop up FM radio. My mobile phone has an FM receiver today, and I've never even looked at it. Some manufacturers have chosen to put this technology into devices today -- and that's fine, if they choose to do so. But, mandating it as part of a backroom political deal? No thanks.

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Overhype

Overhype

by Mike Masnick


Filed Under:
competition, pentagon, wikileaks

Companies:
napster, riaa



How The Pentagon's Reaction To Wikileaks Is Like The RIAA's Reaction To Napster

from the and-it'll-work-just-as-well dept

Earlier, we wrote about the Pentagon's ridiculous and counterproductive attacks on Wikileaks, noting that it was the exact wrong approach to take. In writing that, I probably should have made the connection to some other, similarly short-sighted "attacks" on something one legacy group felt was a threat, but which actually was probably an opportunity -- and in attacking it, that legacy group only served to (1) draw more attention to it and (2) create even more, harder to work with, clones. I'm talking, of course, about the RIAA and its reaction to Napster.

While I didn't think of it, Raffi Khatchadourian did, and wrote a brilliant blog post for the New Yorker making the comparison (that's why he writes for The New Yorker, and I do not). Khatchadourian is actually responding to the equally ridiculous suggestion from former Bush speechwriter Marc Thiessen, that the US should use the military to hunt Julian Assange down and bring him to justice and shut down Wikileaks, which Thiessen calls a "criminal syndicate" (say what?!?). Khatchadourian makes the connection:

Thiessen's argument calls to mind the music industry's effort to shut down Napster--a Web site where recorded music could be traded and downloaded without regard to copyright--in the nineteen-nineties, in that it loses sight of the broader technological and cultural revolution that the Internet has brought to the exchange of information. In 2001, after a lengthy legal battle, the Recording Industry Association of America succeeded in forcing Napster offline, only to watch Napster's services move to a number of other Web sites that were structured in a more decentralized way (pdf)--making the piracy of music even more diffuse and difficult to prosecute. Only recently has the industry grudgingly been adapting to file-sharing rather than fruitlessly seeking to eliminate it, and one can now find music executives who even speak of Napster as a lost opportunity for their industry.

Shutting WikiLeaks down--assuming that this is even possible--would only lead to copycat sites devised by innovators who would make their services even more difficult to curtail. A better approach for the Defense Department might be to consider WikiLeaks a competitor rather than a threat, and to recognize that the spirit of transparency that motivates Assange and his volunteers is shared by a far wider community of people who use the Internet.
Indeed. This is the same thing we've pointed out that the RIAA did with Napster -- losing a huge opportunity and instead driving such efforts totally underground. We've also chided the RIAA and others in the past for not recognizing that file sharing was "competition," and responding appropriately -- and it's a good point with Wikileaks and the Pentagon, even if it might not seem obvious at first. Khatchadourian points out that the analogy works when you realize that the "equivalent" to Wikileaks for the Pentagon is the Freedom of Information Act and the Mandatory Declassification Review -- but both are "slow and inconsistent." Wikileaks, on the other hand is much more efficient (just like Napster vs. the RIAA). He then notes how much of the attention Wikileaks has garnered could have been avoided if the Pentagon had actually embraced transparency and more efficiency:
It's worth recalling the first WikiLeaks project to garner major international attention: a video, shot from an Apache helicopter in 2007, in Iraq, that documented American soldiers killing up to eighteen people. For years, Reuters sought to obtain that video through FOIA because two of its staff members were among the victims. Had the military released this footage to the wire service, and made whatever minor redactions were necessary to protect its operations, there would never have been a film titled "Collateral Murder"--the name of WikiLeaks's package for the video--because there would have been nothing to leak. Even after Assange had published the footage, and even though the events documented in it had been previously revealed in detail by a Washington Post reporter, the military (at least, as of July) has still not officially released it.
In other words, the way to deal with such a competitor is to out innovate them. That certainly sounds familiar.

There's a reason Wikileaks exists, and it's not because it's a criminal syndicate, but because the folks behind it believe that there are serious problems in the way certain types of secrets are used to abuse power. So it represents a more efficient (if blunt) way of solving that. The same is true of the RIAA and Napster (and its descendants). The folks behind file sharing programs felt there were serious problems and inefficiencies with how industry gatekeepers used their gatekeeper role for abuse, rather than in the best interests of the market.

It won't happen (it never does), but Khatchadourian is spot on in noting that the Pentagon really should be recognizing that it's traveling down the same mistaken path as the RIAA, rather than just copying the same types of moves.

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Music Industry

Music Industry

by Mike Masnick


Filed Under:
copyright, radiohead, takedowns

Companies:
ifpi, riaa



Why Is The RIAA Sending Takedown Notices Over Music Radiohead Gave Away For Free?

from the seems-odd dept

One of the "wakeup calls" for the music industry to recognize new business models were coming was the famous Radiohead "name your own price" experiment for the album In Rainbows. Frankly, I still think that particular experiment gets too much attention, as it wasn't well thought out or organized and was mostly done on a whim. I also thought the band made a mistake in ending the download portion even if many people mistakenly claimed that this was an admission that the project was a failure (the band said from the very beginning this was their plan). And, when the numbers came out, it became clear that the experiment was a huge success.

Since then, the band has also come out as very pro-file sharing and anti-RIAA. For example, the band's manager has said that file sharing should be legal and that it is "a great thing for culture and music." In the meantime, Radiohead's Thom Yorke has pointed out that the record labels have been unable to innovate and has predicted the imminent demise of the major labels. Oh, and most importantly for those who claimed the "free" part of their release was a failure, last summer the band officially released a track for free and distributed it via BitTorrent themselves.

So, all of that should make you wonder why the RIAA and the IFPI are issuing DMCA takedown notices for blogs that have hosted In Rainbows. Why indeed? TorrentFreak notes, accurately, that Radiohead did do deals with major labels for distribution of the physical album of In Rainbows, but I was pretty sure they kept the copyrights themselves. Perhaps that's not the case? However, it does seem strange to see songs from In Rainbows included in takedown requests from the RIAA and the IFPI.

We keep hearing from the RIAA and the IFPI that all they want is for consumers to "respect the artists' wishes" when it comes to how their music gets distributed. So, we have to ask, since Radiohead has made it pretty clear they're perfectly happy with their digital copies being distributed this way, why won't the RIAA and IFPI "respects the artists' wishes" on Radiohead's In Rainbows?

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Music Industry

Music Industry

by Mike Masnick


Filed Under:
lawsuits, riaa, success

Companies:
riaa



RIAA Defends Lawsuit Spending... But Reminds Everyone How It Helps Screw Over Musicians

from the who's-rationalizing-now? dept

A few weeks ago, there was a lot of attention paid to the story of how the RIAA had spent $17 million and got back $391,000 in settlements. The RIAA is now defending its legal strategy by claiming that the lawsuits had other benefits, such as injunctions against certain sites and (my favorite) to "foster a respect for the rights of creators." It's difficult to see how that's working, as the legal strategy has not only mobilized many music fans against the RIAA and ridiculous copyright laws, but has even gotten top musicians to speak out against the RIAA and its views on copyright. On top of that, given the continued increase in file sharing usage, the whole claim is a joke.

Separately, though, the RIAA says that the numbers are misleading because "sometimes recoveries go directly to record label plaintiffs."

But that raises a different question. If the labels are getting this money... has any of it been passed on to artists? In the discussion on the original story, we had one commenter, who works as an auditor in the music licensing field, who pointed this out and noted that this money isn't going to artists or songwriters at all. We had pointed this out back in 2006, when part of the Google buyout of YouTube involved paying off the big record labels... and that deal was structured in a way that those labels didn't have to share that money with artists.

We've already seen how record label accounting is used to screw over musicians, but this is an important point as well. The RIAA positions itself as defending artists' rights. It talks about how these lawsuits are carried out to protect musicians and help those musicians earn a living. But it's becoming increasingly clear that of the money that actually comes in from these lawsuits, very little of it ever is seen by the artists the labels claim they're protecting.

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Say That Again

Say That Again

by Mike Masnick


Filed Under:
guns 'n roses, kevin cogill, psa, riaa

Companies:
riaa



Uploader Of Guns 'N Roses Album Never Forced To Do RIAA Propaganda; So He Tells The Truth Instead

from the well-how-about-that dept

A year ago, we wrote about the ridiculous situation involving Kevin Cogill, who was sentenced to two months of house arrest. We noted, at the time, that part of the agreement was also that he would produce propaganda for the RIAA. However, a year has passed and he never did the propaganda recording... and he's no longer required to do it. Instead, he's doing interviews where he's saying that people involved in file sharing can get "F'd in the A" by the RIAA. Not quite what the RIAA expected, I guess.

Amusingly, the RIAA's response was that it chose not to have Cogill make the propaganda tapes because of the "unnecessarily high production costs." Leave it to the RIAA -- the organization that pays its boss over $2 million and spends millions on lawsuits that bring nothing back -- to think it's too expensive to record a guy talking. But, perhaps it's telling. Maybe the folks at the RIAA really don't recognize the revolution in recording equipment that makes it rather cheap to record things these days. No wonder their strategy has been so screwed up!

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Legal Issues

Legal Issues

by Mike Masnick


Filed Under:
copyright, lawsuits

Companies:
riaa



RIAA Spent $17.6 Million In Lawsuits... To Get $391,000 In Settlements?

from the business-as-usual dept

Last month we discussed the question of whether or not the RIAA's legal strategy was a success or not. An RIAA supporter had claimed that it was clearly a success, since most of the people the RIAA sued chose to settle. We questioned that, pointing out that the bottom line of the major record labels was shrinking fast, and the rate of file sharing was increasing. At the same time, we pointed out that the record labels themselves had admitted that the lawsuits were "a money pit." Ray Beckermann has done some digging and is pointing out just how big a money pit it really was. In looking through the RIAA's financial statements, he notes over $17.6 million spent on big name law firms who were the key players in the lawsuit campaign. And all those settlements? In 2008, they brought in $391,000. The 2007 numbers were even worse. $21 million in legal fees, plus another $3.5 million for "investigative services" to bring in... $515,929 in settlement fees. 2006? $19 million in legal fees, $3.6 million in investigative services... $455,000 in settlements.

So if we're doing some quick math, over a three year period, the RIAA spent over $64 million on this lawsuit campaign... which brought in about $1.4 million in settlement money. We're talking about getting back about 2% of the money spent.

Wow. These lawsuits weren't just a money pit. They were an economic disaster. And don't buy the argument that this was the cost of "educating" people not to file share. If that were the case, then file sharing wouldn't still keep increasing. There's no way you can look at these numbers and not realize just how disastrous the RIAA's legal campaign was. And yet the RIAA bosses are getting raises? Incredible. It's been a dozen years since the RIAA had a very real opportunity to lead the recording industry into the digital era by adapting and embracing what the technology allowed. Instead, they've fought it the whole way, costing millions of dollars, and severely impacting the labels' bottom lines. Can anyone explain why the labels are still supporting the current RIAA leadership when it appears that every step of the way they've made exactly the wrong decisions?

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Music Industry

Music Industry

by Mike Masnick


Filed Under:
cary sherman, mitch bainwol, salaries

Companies:
riaa



With The Recording Industry In Free Fall, Why Are RIAA Bosses Getting Raises?

from the rewarding-failure dept

It's difficult to think of a more disastrous strategy pioneered for the recording industry than the one cooked up by RIAA bosses Mitch Bainwol and Cary Sherman. The two were the "masterminds" behind the plan to sue fans directly, which has been an uncontested disaster that did absolutely nothing to help the bottom line of the record labels. If anything, the evidence suggests that the lawsuit strategy has only galvanized folks to look for alternatives beyond spending money on RIAA labels. The RIAA finally dropped the lawsuit strategy, which was deemed a money pit by a recording industry exec and almost resulted in EMI leaving the RIAA. After all of that, the RIAA itself had massive layoffs.

Given all of that, you might think that Bainwol and Sherman should be looking for new jobs. Instead, apparently, they've been given hefty raises. P2Pnet notes that Bainwol in 2008 made over $2 million dollars -- an increase from the $1.485 million he made in 2007. Sherman made $1.332 million, noticeably more than the $985k he made a year earlier. While I don't have any issue with the absolute amounts, I do question why these guys are getting raises while presiding over what will clearly be looked back on as one of the biggest blunders by an industry in decades. On top of that, I can see how some might question how the RIAA can claim to represent "starving artists" when its execs are doing so well. Apparently, the answer to not being a starving artist is to go become boss of the RIAA.

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Copyright

Copyright

by Mike Masnick


Filed Under:
copyright, damages, jammie thomas, joel tenenbaoum, nancy gertner

Companies:
riaa



Looking More Closely At Judge Gertner's Constitutional Analysis Of Copyright Awards In Tenenbaum Case

from the the-battle-is-on dept

Last Friday, we quickly covered the news that Judge Nancy Gertner had declared the original jury award of $675,000 against Joel Tenenbaum for downloading and sharing some songs unconstitutionally excessive. Over the weekend, however, I had some more time to read the full ruling (posted by Eric Goldman) and get a sense of what Gertner's full argument meant. You can read the ruling here, and I highly recommend taking the time to read the whole thing:

In it, she clearly explains why the Constitutional analysis was necessary (she could have just reduced the award using the remittitur process, but noted that the RIAA made it clear they would challenge such a ruling, and thus it would eventually come around to the Constitutional questions no matter what.

So with that in mind, she clearly gave a lot of thought to the Constitutional questions, and goes back to the key point, that if the punishment is seriously out of line with any sort of "harm" caused, then it's unconstitutional. She notes that she must give deference to Congress' intent with the statutory rates it set for copyright infringement, as well as to the jury's verdict. But, even so, she suggests that the jury's award was way out of line with reasonable awards in other copyright lawsuits... and (more importantly) way out of line with Congress' intent of using statutory rates to deter infringement:
This award is far greater than necessary to serve the government's legitimate interests in compensating copyright owners and deterring infringement. In fact, it bears no meaningful relationship to these objectives.
In attacking the Constitutional questions, Judge Gertner spent a lot of time highlighting the case law on the Due Process Clause, noting many, many cases where the Supreme Court has made it clear that there are limits to what should be considered Constitutional when it comes to jury awards -- even in the case of statutory awards (even if the courts often seem to rule that in the cases they're looking at, the line has not been crossed).

Defenders of both the original Jammie Thomas award and the Joel Tenenbaum award have frequently claimed that the case law (mainly the BMW v. Gore case) doesn't apply since that was not for statutory damages, where the rates are clear and already set. That's going to be a key point made in the inevitable challenge to this ruling. But Gertner aptly explains why it's reasonable to explore whether or not the award is unconstitutionally excessive, even when it's within the statutory rates, and even suggests that both the government and the RIAA are misreading other precedents -- with the key one being the Williams case, which found a damages award acceptable because it fell within statutory rates. Gertner points out that the RIAA and the government are taking that ruling out of context, and only looking at the result, rather than the actual reasoning.
At their root, the standards articulated in Williams, BMW, and State Farm all aim at providing defendants with some protection against arbitrary government action in the form of damages awards that are grossly excessive in relation to the objectives that the awards are designed to achieve. Indeed, early twentieth century cases such as Williams were the seedlings from which the Supreme Court's recent punitive damages jurisprudence sprouted.
She also notes that even in the Congressional record in efforts to increase the statutory rates, Congressional members suggested that courts would make sure the actual awards were reasonable and not excessive:
In fact, Senator Orrin Hatch, a sponsor of the Digital Theft Deterrence and Copyright Damages Improvement Act of 1999, which increased section 504(c)'s statutory damages ranges to their current levels, stated in remarks regarding a predecessor of that bill, "In most cases, courts attempt to do justice by fixing the statutory damages at a level that approximates actual damages and defendant's profits."
That line right there might be pretty damaging to the RIAA's typical claim that courts are just supposed to assume that Congress knows best in setting the rates, and shouldn't try to approximate actual damages with statutory rates.

From there, Judge Gertner applies the test found in the BMW case, and points out that (contrary to some of the silliest claims from copyright system defenders), Congress clearly did not expect lawsuits against individuals sharing files for personal use when it set such high rates:
Later statements by Senators Orrin Hatch and Patrick Leahy, two sponsors of the Digital Theft Deterrence Act, strongly suggest that Tenenbaum is correct; they did not anticipate that individuals such as Tenenbaum who engaged in noncommercial file-sharing would be subjected to liability for statutory damages under section 504(c). Hatch and Leahy presided over a Senate Judiciary Committee hearing titled "Music on the Internet: Is There an Upside to Downloading?" on July 11, 2000.... During the hearing, the committee members demonstrated how the peer-to-peer system Gnutella is used by downloading and then playing a song by the band Creed. ... As the committee was downloading the Creed song, Senator Leahy proudly proclaimed that he was doing some of his own downloading on his laptop. ... When one of the developers of Gnutella pointed out to the committee members that they might be engaging in copyright infringement, Senator Hatch responded that their downloading and public performance of the Creed song qualified as "fair use" since it was carried out for "educational and governmental purposes." ... Nevertheless, the senators' willingness to download copyrighted sound recordings through a peer-to-peer network during a committee hearing suggests, at the very least, that they did not view such downloading as particularly reprehensible.

And this inference from the senators' conduct is largely confirmed by their words. Although Senator Hatch noted that peer-to-peer technology had the capacity, "if misused, to rob [artists] of their livelihood," ... he also praised the development of Gnutella as "quite an accomplishment," ... And Senator Leahy added:
[W]hen I go on college campuses, as many of us do, to talk and everybody is talking about what they have downloaded, how they share, and so on, and when my kids pick up a "Black Muddy River," which happens to be one of my favorites of the Dead, and send it to me -- they have heard a new version -- and I log on in the morning while I am having my breakfast and there it is, I mean this is a whole different world, and I think we have to recognize that on where we go.
Senator Hatch's tolerance of, if not admiration for, peer-to-peer networks was even more on display at a special Judiciary Committee hearing held on October 9, 2000, at Brigham Young University ("BYU"). ... Shawn Fanning, the founder of Napster, was the star witness at this hearing, and Senator Hatch repeatedly praised Fanning, expressing how "proud" he was of Fanning and even suggesting that Fanning should become a professor at BYU or run for political office. ... Obviously, Senator Hatch's comments should be taken with a large grain of salt... But his comments nevertheless suggest that he did not anticipate that the statutory damages scheme over which his committee had jurisdiction would be applied to users of Napster and other peer-to-peer networks.
I have to admit that I was unaware of these quotes from Senators Hatch and Leahy -- both of whom are normally seen as being very strongly in favor of strict copyright laws (Hatch, famously, once suggested coming up with a way to destroy the computers of file sharers).

On top of that, Judge Gertner compares the fines for Tenenbaum with restaurants and bars that have not paid their licenses, noting that those are clear cases of infringement for commercial reasons, yet the fines are a small multiple of the cost of a license. She points out that this seems like a much more egregious case, yet the awards are much lower:
The jury's award in this case also appears egregious in light of the damages typically imposed on restaurants, bars, and other businesses that play copyrighted songs in their establishments without first acquiring the appropriate licenses. These defendants are arguably more culpable than Tenenbaum. Unlike Tenenbaum, who did not receive any direct pecuniary gain from his file-sharing, defendants in these cases play copyrighted music to create a more pleasurable atmosphere for their customers, thus generating more business and, consequently, more revenue.... In addition, defendants accused of unlicensed public performances often receive several notices that their conduct is unlawful before they are sued. Thus, like Tenenbaum's file-sharing, their infringing conduct is generally willful. .... Nevertheless, the awards in such cases are generally no more than "two to six times the license fees defendants 'saved' by not obeying the Copyright Act"--a ratio of statutory to actual damages far lower than the ratio present in this case.
Clearly, this case is nowhere close to over, but it is still interesting to read through the details of the ruling. Obviously, Gertner knows this is going to be appealed, and she put a lot of effort into making the case for why this ruling was excessive, in hopes of having her reasoning help carry the later appeals.

33 Comments | Leave a Comment..

 
Copyright

Copyright

by Mike Masnick


Filed Under:
copyright, damages, jammie thomas, joel tenenbaoum

Companies:
riaa



Judge Says Damages In Tenenbaum Case Were 'Unconstitutionally Excessive'

from the the-riaa-is-not-going-to-like-that dept

It seems like the Joel Tenenbaum case is simply an echo on the Jammie Thomas case. Both lawsuits involved very flawed defendants who probably shouldn't have gone through with their fights against the RIAA. In both cases, juries awarded huge statutory damages awards to the record labels. In Thomas' case it was $1.92 million or $80,000 per song. In the Tenenbaum case, it was $675,000 or $22,500 per song. Even though both cases were what I considered to be "bad" cases (too much evidence that both Thomas and Tenenbaum were actually heavily involved in file sharing), both have used the rulings to challenge the statutory damages awards as being unconstitutional.. and now the judges in both cases have agreed.

As you probably recall, the judge in the Thomas case reduced the $1.92 million award to $54,000 (or $2,250 per song) and today comes the news that Judge Gertner in the Tenenbaum case has declared the original damages award to be "unconstitutionally excessive" and slashed the total by 90% down to $67,500. In both cases, the judges actually set the per song damages award down to $2,250. There were lots of questions when Judge Davis did this in the Jammie Thomas case if a judge could actually do that, and that's still being fought to some extent. It seems likely that, as with the Thomas case, the RIAA will appeal this particular ruling because it most certainly does not want a precedent on the books that can lower the statutory damages rate for copyright.

This could start to get very interesting. Both judges are clearly taking a stand that the actual statutory rates set by Congress are ridiculously high and totally out of proportion with the actions done by the defendants. There is definitely some precedent for ridiculously high damages awards being thrown out as unconstitutionally excessive... but not when it comes to statutory rates, where the courts have generally said Congress has great leeway to determine what is and what is not excessive. However, with two judges pointing out that a number within the range provided by Congress is excessive, it's setting up a potentially very important legal battle about the statutory damages associated with copyright.

The industry has always pushed for higher and higher damages, somehow believing that will act as a disincentive for infringing. Yet, there doesn't appear to be any evidence at all that it's working. Instead, such high damages have actually done the opposite. They've convinced many, many people of just how ridiculously unfair and out of touch copyright laws are. The general public can recognize that sharing a single file shouldn't lead to a fine of tens of thousands of dollars. It's so out of proportion with reality that they begin to question the overall setup of copyright law itself. The industry's focus on higher and higher copyright damages has been a major strategic mistake that has backfired. These rulings -- which the industry will fight tooth and nail -- might actually be a blessing in disguise for the industry. If the actual damages weren't so ridiculous, people probably wouldn't be so up in arms over copyright issues.

53 Comments | Leave a Comment..

 
Music Industry

Music Industry

by Mike Masnick


Filed Under:
balance, copyright, riaa

Companies:
riaa



Would You Believe The RIAA Doesn't Agree With The Judge In The Viacom/YouTube Ruling?

from the what-a-shock dept

I can't imagine this surprises anyone, but Slashdot points us to the news that the RIAA is upset by the judge's ruling in the Viacom/YouTube case, which found that YouTube is protected by the DMCA's safe harbors. Of course, Hollywood and the music industry have always hated the safe harbors -- which were only put in the DMCA to appease internet companies and keep them from fighting the rest of the DMCA. But, of course, the entertainment industry doesn't like to give even an inch on these matters, so this case has always been about moving the goalposts and effectively decimating the safe harbors to the point that they are meaningless. The RIAA's statement was posted to its blog (where you cannot comment, of course) and is short, sweet and totally misleading:

Add our voice to those who disagree with a recent summary judgment ruling in the court case between Viacom and YouTube.

We believe that the district court's dangerously expansive reading of the liability immunity provisions of the DMCA upsets the careful balance struck within the law and is bad public policy. It will actually discourage service providers from taking steps to minimize the illegal exchange of copyrighted works on their sites. As the White House recently noted in its strategic plan to combat intellectual property theft it is essential for service providers and intermediaries generally to work collaboratively with content owners to seek practical and efficient solutions to address infringement. We need businesses to be more proactive in addressing infringement, not less. We expect the Court of Appeals will better understand the balance Congress struck when it enacted the DMCA.
This is both wrong and amusing at the same time. The court's ruling was hardly "expansive." It covered the same ground as numerous other cases and basically kept the status quo. It was Viacom that was trying to expand the meaning of the law in effectively wiping out the safe harbor provision.

The idea that this ruling discourages providers from trying to minimize infringement (not theft -- and it's really silly that the industry keeps calling it theft) has already been debunked. Most of the serious companies in the space want to work with the entertainment industry and have put in place voluntary filters -- not because the law requires them, but because they feel it makes business sense. So the ability to work collaboratively is still very much there. And, frankly, it's pretty insulting that the RIAA thinks that tech companies will only work with the RIAA if the law requires them to do so. Of course, it's so very typical of the entertainment industry mindset, where everything is a fight and everyone is in competition. It's as if they don't understand non-zero sum games. The internet world has never needed legal forces to work collaboratively with the entertainment industry. They've wanted to do so time and time again. Napster tried very hard, and the RIAA hit them with a lawsuit. The number of innovative startups sued by RIAA members to force those companies to cough up some equity is too long to list here.

RIAA labels don't work collaboratively. They sue. Arguing that this particular ruling will make it somehow harder to work collaboratively is ridiculous. The tech firms were never the ones running to the lawyers. They were always willing to partner. But, of course, at this point, I guess expecting intellectual honesty from the likes of the RIAA remains a pipedream.

51 Comments | Leave a Comment..

 
Copyright

Copyright

by Mike Masnick


Filed Under:
astroturfing, canada, copyright, dmca

Companies:
balanced copyright, cria, riaa



Supposed 'Grass Roots' Site Pushing For Canadian DMCA Admits That It's Funded By The Recording Industry

from the well,-look-at-that dept

It didn't take long for people to see through the bogus astroturfing site, BalancedCopyrightForCanada.ca, designed to look like a grass roots site in support of the new Canadian DMCA law, Bill C-32. Pretty quickly, people suggested that the site was obviously a front for the big record labels who have been behind the push for a Canadian DMCA for years. The site started hiding some information, but now Michael Geist points out that the site has finally 'fessed up to the fact that it was funded by the CRIA, which is really just the RIAA in Canadian clothing. How very grassroots. It also seems noteworthy that on the advisory board for the site is Richard Owens, the copyright lawyer who, just before the new bill was introduced, got some media attention for his ridiculous attempt to smear the public for their input during last year's public consultation on copyright reform. Of course, those consultations showed an overwhelming majority of those who took part were against a ridiculous digital locks/anti-circumvention policy, which is found in the law. It seems downright laughable that a group pretending to be a "grassroots" group would put on its board a guy who went out of his way to mock and discount an actual grassroots effort.

39 Comments | Leave a Comment..

 
Music Industry

Music Industry

by Mike Masnick


Filed Under:
copyright, copyright royalty board, royalties

Companies:
riaa, sga



As The RIAA Lobbies For More Royalties For Itself, It's Fighting (And Losing) Over Having To Pay Royalties To Songwriters

from the what's-good-for-the-goose... dept

The RIAA is in the middle of a big fight for new royalties (i.e., a performance rights tax) on songs played on the radio, going on and on about how anyone against those fees are "stealing" from them. Yet, when it comes to the royalties that RIAA members have to pay to others, suddenly those are worth fighting against. As you hopefully know, there are a few different copyrights related to music. There's the copyright on the recording itself, which is usually held by the record label. But there is also the copyright on the song or composition, which can be held by a music publisher or the songwriter.

For whatever reason, while there is a compulsory license setup for anyone doing a cover song, such that if you cover a song, you don't have to first get permission to do so, but you just have to pay an agreed upon rate, which is usually set by the Copyright Royalty Board (a group of judges who more or less pick a number out of a hat). There are all sorts of problems with having a group of judges trying to randomly set prices on royalties, but it is how the system is set up. What's amusing is that after a recent Copyright Royalty Board ruling on cover songs set the rate higher than the RIAA liked, the RIAA went to court to get those rates changed. A district court turned the RIAA down, and now an appeals court has done the same.

Specifically, the RIAA got upset that the CRB said it had to pay late fees, and also that it says composition copyright holders should get a whopping 24 cents for every ringtone sold (way above the rate for songs on CDs). Instead, the RIAA argued that songwriters/publishers should receive a percentage of revenue. This one really makes me laugh. For years, various digital music startups have tried to license music from the RIAA -- and all of them go to the RIAA with a "percentage of revenue" offer. In every single case the RIAA turns them down, demanding huge upfront fees and guarantees on revenue. Funny that when it's their own money on the line, suddenly a percentage of revenue is the preferred option.

In both cases, the court rules against the RIAA, pointing out that, even though the RIAA doesn't like the ruling, the CRB is well within its legal mandate to make both decisions. To be honest, I actually think the RIAA is correct that these rates and the reasoning behind them are ridiculous and not at all sensible. The ringtone rate, in particular, is particularly egregious, and make it difficult for creative business models that embrace things like free ringtones to exist.

However, I find it to be quite hilarious to see the RIAA arguing so vehemently against these rate rulings, when it's demanding similar rulings on its own behalf. Apparently, the RIAA really only supports such rates when it gets to collect them. When it has to pay out, suddenly those royalties are a problem. Funny how that works...

17 Comments | Leave a Comment..

 
Music Industry

Music Industry

by Mike Masnick


Filed Under:
astroturfing, copyright, grassroots, three strikes

Companies:
riaa, universal music



Major Labels Begin Major Astroturfing Campaign To Get 3 Strikes In The US

from the begin-astroturfing-now... dept

A friend just forwarded me an email "from" the CEO of Universal Music (really from an email marketing campaign system if you look at the headers) that encourages him to push for new laws in the US to kick people offline for file sharing. To date, the RIAA and others in the recording industry have known better than to seriously push for a three strikes-type legislation in the US, knowing that it is a battle that they very well might lose. They had hoped, quite strongly, that various ISPs would come to simply agree to implement a three strikes plan to kick people offline after three accusations (not convictions) of copyright infringement. But it's been nearly a year and a half since the RIAA believed those deals were close, and there's still nothing to show for it. Nothing.

So, it looks like the industry is going to plan B: which is going back to trying to ram through legislation that will require ISPs to take the draconian step of protecting one industry's broken business model. And to get this going, it looks like the industry has set up a neat little set of astroturfing groups and "consumer" campaigns that try to hide the specifics, but clearly are designed to get similar three strikes legislation (similar to the Digital Economy Act in the UK) put in place in the US.

The letter starts out by making it sound like a populist sort of deal:

I've received hundreds of e-mails enthusiastically reacting to my "call to action" at the National Association of Recording Merchandisers convention last month. The music business is facing huge challenges from piracy and theft. Never before in American history has an entire industry been so decimated by illegal behavior. Yet the government has not responded in a meaningful way to help us address this crisis. My call to action is for all of us to become more aggressive in lobbying our government, more outspoken in drawing attention to the problems caused by piracy and more actively engaged. We cannot win this fight alone.
Note the choice of language. "Hundreds of emails" is his way of suggesting that there's a groundswell of public support. But, for what kind of "call to action"? Ah, the one where we ask the government to protect Universal Music's business model. Amusingly enough, at last year's NARM, I gave a presentation on all sorts of ways that the industry could thrive through adopting new business models. I was told that two RIAA members specifically asked the conference not to let me speak, and while I do not believe anyone from Universal Music attended my speech, they did have incredibly scantily clad models standing outside the door inviting people to go to a party. Perhaps instead of partying and lobbying the government, you could have looked at what's actually working, instead of complaining that nothing will work.
Governments outside the U.S. are legislating, regulating and playing a prominent role in discussions with ISPs (Internet Service Providers). Sales have dramatically improved in these countries. How is it that the U.S. - with the most successful music community in the world - is not keeping up with places like South Korea, France, the UK and New Zealand?
And here we go. Note that the four countries named all put in place forms of "three strikes" legislation recently to kick file sharers off the internet based on accusations, not convictions. By naming those four countries, the letter is implicitly calling for support for three strikes legislation requiring ISPs to try to prop up Universal's failing business model.
As I said in my speech, I hope that the industry can negotiate a voluntary deal with the ISPs. We need our government representatives to encourage this. But whether or not we reach a deal with the ISPs, our government needs to know that we've got a piracy problem and we need real solutions. To accomplish this, our government needs to hear from all of us, so they know that their constituents are out here. Join me in calling on our elected officials to fight piracy. Please help by forwarding this email to your colleagues, friends- everyone who loves music. And consider enlisting your entire company to help in this fight. Then by clicking on the link below a message will be sent to your representatives in Washington. Help us launch a viral campaign to cut off access to the online sites that are used to steal our music, our property and our jobs. In only takes a second but it can make a tremendous impact.
And here we go. The call to make this into a "viral" campaign. Well, let's look at the details. While Universal uses some nasty "spy on your clickthrough" HTML attempts to hide the actual sites it's sending you to, it's not difficult to figure out more details on this campaign. The first place they want you to go is to a website for MusicRightsNow.org, which automatically forwards you to a Facebook page. Facebook page? Why that looks all grassrootsy and made by "the people" right? Not a recording industry front at all! It even includes a neat little inclusive manifesto claiming to represent everyone:
"Music rights now" is a community of individuals who believe music has value and is worthy of protection from online theft. We are songwriters, artists, musicians, recording studio engineers, managers, retailers, record company employees, publishers, performing rights organization employees, music producers, truck drivers, lawyers, stylists, music video directors, laborers, photographers, graphic designers, DJs, radio employees, music fans -- and countless others' who have joined together to fight for the survival of artistry and the music industry.
Except, of course, infringement is not "theft" and a grassroots group of folks getting together to "fight for the survival of artistry and the music industry" don't get the CEO of Universal Music to announce their coming out party. As for the "survival of artistry and the music industry," as we were just pointing out, both are doing fantastic. More music is being created and consumed than ever before. More money is being spent and made on the music industry than ever before. In fact, it really seems like the only people who are suffering happen to work at a few companies that have refused to adapt with the times... like the major record labels. So, can we cancel this campaign? It looks like the actual music industry is doing great.

But, let's explore further.

So who's actually behind "Music Rights Now"? Well, the Facebook breadcrumbs lead to Music United -- a long term recording industry front group that was mocked mercilessly nearly a decade ago, for its incredibly lame attempts to "speak the language of kids today" to teach them that file sharing is bad. It doesn't look like things have improved much. The front page points to a widely debunked study (which it refers to as "credible") claiming that file sharing has cost $12.5 billion dollars to the US economy and has killed 70,000 jobs. Then there's this fun bit of misleading propaganda:
The unauthorized reproduction and distribution of copyrighted music is JUST AS ILLEGAL AS SHOPLIFTING A CD. Sharing music on peer-to-peer networks like Ares, BitTorrent, Gnutella, Limewire, and Morpheus is against the law. The rules are very simple. Unless you own the copyright, it's not yours to distribute.
A bit out of date there on the list of file sharing networks, of course. Also, "just as illegal" is a bit misleading. Both are, in fact, illegal, but under very, very different laws. But the key point is that they're wrong. Making a blanket statement that "sharing music on peer-to-peer networks... is against the law," is flat out wrong. It would be news to all of the musicians we know who encourage their work be shared online. The web page also claims that "Digital theft is killing the music business." Again, the evidence we just pointed to yesterday shows that music is doing better than ever.

Of course, in the fine print, we get the list of who's behind this. It includes all the usual suspects: the RIAA, the NMPA, ASCAP, SESAC, SoundExchange, the SGA, A2IM, BMI, AFTRA and a variety of other smaller organizations that represent labels and publishers. Consumer groups? Nope. Of course not. This is not, after all, a consumer driven effort. It's just designed to look like one.

Either way, it seems clear that the industry is realizing that ISPs aren't going to agree to kick people offline based on accusations, so it's kicking off a well-coordinated campaign to get the government to help, and pressure it to put in place the same sort of overly draconian protectionist measures that don't actually help musicians or the music industry -- but clearly try to prop up the failed and dying business model of a few middlemen. Not surprisingly, this seems well-timed to go with the expected release this week of the report from the White House's IP Enforcement Coordinator (IP Czar), Victoria Espinel.... How much do people want to bet her report also fits in with propping up those businesses?

38 Comments | Leave a Comment..

 
Music Industry

Music Industry

by Mike Masnick


Filed Under:
copyright, file sharing, lawsuits

Companies:
limewire, nmpa, riaa



LimeWire Sued Again... How Many Times Does The Industry Want To Kill It?

from the adding-lawsuit-to-injunction dept

The RIAA is still fighting to force LimeWire to shut down completely after its legal win over the company. Given the nature of the initial ruling, it seems pretty likely that LimeWire is fighting a losing battle. Recently lots of folks were discussing the ridiculous damages that the RIAA is claiming LimeWire owes. On top of that, however, it looks like the music publishers have decided to pile on as well, and have filed a separate copyright infringement lawsuit against LimeWire. Honestly, this seems like it's just for the sake of vanity, or to be able to primp and preen for its members about how it's "doing something." The initial lawsuit will almost certainly kill off Limewire as a company. This new lawsuit can't kill it again. It's just a waste of time and money. Meanwhile, LimeWire users will have just moved on and will continue sharing files.

23 Comments | Leave a Comment..

 
Music Industry

Music Industry

by Mike Masnick


Filed Under:
record labels, recording industry, sales

Companies:
riaa



The Rise And Fall Of The RIAA

from the predicting-the-end dept

We recently had a post questioning whether the RIAA's legal campaign was a success or not. It seemed like there was plenty of evidence that it has been an incredible failure. Separately, we had a post about Radiohead's Thom Yorke, suggesting that the major record labels were going out of business in a matter of months. While we felt that was a bit of an exaggeration, one of our commenters, Ccomp5950 compiled data on RIAA label sales, along with some helpful notes about what other factors were going on at the time:

Year: $ in Millions
1992: 9024
1993: 10046.6 (CD players started to get more affordable towards mid-year)
1994: 12068
1995: 12320.3
1996: 12533.8
1997: 12236.8
1998: 13723.4
1999: 14651 (Work made for hire controversy)
2000: 14404 (Napster sued into bankruptcy)
2001: 13700 (Ipod came out October 2001)
2002: 12,614.2 (Price Fixing lawsuit hits RIAA)
2003: 11,854.4 (Grokster lawsuit, "induced infringement" introduced) (Mass lawsuits by RIAA start(AKA: The education campaign))
2004: 12,345.0 [Revenue Physical / Digital] (BMG gets out of the music business, sold to Sony later on: Big 5 becomes Big 4 for RIAA)
2005: 12,296.9 [91%/9%]
2006: 11,758.2 [83.9%/16.1%]
2007: 10,370.0 [77%/23%]
2008: 8,768.4 [66%/34%] (RIAA declares it's going to stop mass lawsuits with member money problems and EMI almost bankrupt)
2009: 7,690.0 [59%/41%] (Massive layoffs hit RIAA around Febuary: Blames piracy)

Sources:
http://www.azoz.com/music/features/0008.html (statistics from 90's to 2001)
http://76.74.24.142/81128FFD-028F-282E-1CE5-FDBF16A46388.pdf (Statistics for 97 to 2007)
http://76.74.24.142/A200B8A7-6BBF-EF15-3038-582014919F78.pdf (2008-2009)
It's a great list, but I felt it could be even more powerful as a graph, so I just threw the following together, based on the info above:
And, that, right there, does a nice job painting a picture on the decline and fall of the RIAA and the major record labels. A few points are worth highlighting:
  • If you're not familiar with the "works for hire" scandal, you can read the full background here. Basically, a Congressional staffer by the name of Mitch Glazier snuck a tiny unnoticed amendment into a much larger bill in the middle of the night -- supposedly at the request of the RIAA -- without telling anyone. It effectively changed the definition of music recordings into "works made for hire," which was really important, because it meant the RIAA labels could hang onto musicians' copyrights for much longer, avoiding termination rights that let musicians reclaim their copyrights. Just a few months later, Glazier left his low-paying Congressional staffer job for a $500,000 job with the RIAA, which I believe he still holds ten years later. Thankfully, people quickly recognized what he had done and Congress had to go back and fix Glazier's sneaky wording. However, it is worth noting that the peak of this chart is right when Glazier inserted his infamous four words.
  • As we discussed last fall, now that musicians do have termination rights, they're lining up to use them and take their copyrights back from the labels. They can start getting the copyrights back in 2013. If you're looking for a date when the bottom totally falls out for the RIAA labels, that may be it. When the rights to their back catalog starts to drop out, this chart looks even worse. The RIAA won't give up easily, of course. The latest stunt they're trying to pull is to "re-record" albums, claiming that it creates a brand new copyright, that gives them another 35 years before termination rights are applicable. That is, of course, ridiculous, but the RIAA will likely try to fight it out in court for many years to extend that 2013 deadline by a few more years. Of course, all that money on legal fees could have gone to innovating, but that's just not the RIAA way.
  • Note that digital music sales is not even close to being a savior. The total is still dropping rapidly.
  • Of course, many have argued that the rise and fall may have a lot more to do with CD replacements of previous formats -- and this chart certainly suggests that could be an explanation. The big jump happened right when CDs became affordable, and people needed to go out and replace their vinyl and cassette (and 8-track!) collections. After a few years of that, it makes sense that the market should drop anyway.
  • Once again, it's important to point out that the chart above is not the entire music industry, but a limited segment of it: the RIAA record labels, mainly comprised of the big four record labels. It doesn't take into account all of the other aspects of the music business -- nearly every single one of which has been growing during this same period. It also doesn't take into account the vast success stories of independent artists and labels doing creative business models and routing around the legacy gatekeepers.

81 Comments | Leave a Comment..

 
Music Industry

Music Industry

by Mike Masnick


Filed Under:
lawsuits, riaa, success

Companies:
riaa



Defining Success: Were The RIAA's Lawsuits A Success Or Not?

from the you-can't-handle-the-truth dept

Over the last few weeks, we've noticed that a series of folks who regularly portray "the loyal opposition" in our comments have been trying to make the case that the RIAA's legal strategy for much of the past decade was not, in fact, a dismal failure. They're posting editorials insisting that the lawsuit campaign was what was necessary to force laws to change in the RIAA's favor, for one thing. And then, one of our regular "anonymous" commenters submitted the following story, insisting that we would never publish it because "Techdirt never publishes the truth," as well as claiming that the following is proof that the RIAA's lawsuits against music fans was a "carefully crafted legal action that has produced results." The specific story is a story from Ars Technica about US Copyright Group's lawsuit campaign (which we've been covering as well), but which includes the following aside about the RIAA's lawsuits:

As the RIAA lawsuits showed us, most people will settle. Data from the recording industry lawsuits, revealed in a court case, showed that 11,000 of the 18,000 Does settled immediately or had their cases dropped by the labels. Seven thousand either refused to settle or never responded to the settlement letter, but after the RIAA subpoenaed their identities and filed "named" lawsuits against them, nearly every one settled.

After years of litigation, the number of people who have pursued a trial all the way to a verdict can be counted on one hand.
This, it appears, is the evidence that the RIAA's lawsuit campaign was a whopping success. Of course, some of us might define success in different ways. The RIAA set off this legal strategy, back in 2003, by claiming that this was part of its "education" campaign to get people to stop using file sharing networks, and go back to buying music directly. How has that worked? Oh, it hasn't. The number of people using file sharing networks to access unauthorized works has continued to grow at a rather rapid clip. And, of course, the real point of all of this was the bottom line: it was to try to help save the big five (at the time) record labels. Except that hasn't worked either. The big five became the big four and the big four are pretty damn close to becoming the big three, once everyone sorts out what to do with EMI. And all of them have a lot less money than they did before.

As for how successful the lawsuits have been for those big record labels? So successful that EMI threatened to leave both the RIAA and IFPI if it didn't back away from these lawsuits. So successful that Sony execs referred to the lawsuits as a "money pit" that have cost the industry millions without bringing back anything near that much in settlement fees.

The fact that lots of people paid up to settle extortion-like fees didn't stop people from using file sharing networks to access unauthorized materials. It didn't get more people to buy. It didn't help the bottom line. It hasn't helped the record labels sell more product. It certainly hasn't helped the big labels stay in business. Hell, it hasn't even helped the RIAA. Towards the end of the legal campaign, the RIAA ended up having massive layoffs of its own staff. And, let's not even get into discussing what the average music fan thinks of the RIAA and the big labels these days...

Success? If that's what you consider a success story, then you're doing it wrong. How you measure a success is everything, and if your metrics are that you got a large percentage of people to pay up for extortion-like lawsuits, pretty much guaranteeing they'd never buy from you again, while the rest of your business burned to the ground, I'm sorry if I have to question your definition of "success."

416 Comments | Leave a Comment..

 
Too Much Free Time

Too Much Free Time

by Mike Masnick


Filed Under:
hilary rosen

Companies:
bp, riaa



BP Hires Former RIAA Boss For PR Work

from the why-don't-you-just-sue-all-the-oil? dept

It's been a little while since we last wrote about Hilary Rosen, who ran the RIAA for many years, and presided over its initial disastrous decision to fight the internet and go after users. However, we have to say that it's somewhat amusing to find out that BP has now hired Rosen for PR help in dealing with the oil spill in the Gulf. Hopefully "suing all the people who live along the coast" isn't one of her suggestions. But, perhaps she can figure out a way to blame the spill on "pirates" of some kind, right?

31 Comments | Leave a Comment..

 

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5:56am: Funding To Edit 200 Hours Of Pirate Bay Documentary Footage Raised In Just Three Days (14)
4:05am: Companies Not Rushing To The Patent Office For Accelerated Review Of Green Patents (12)
1:41am: Perhaps Avoiding Links Is Really A Way To Get People Not To Read The Details Of The Studies You're Misrepresenting (13)

Tuesday

10:42pm: What If You Could Click A Button And A Sponsor Would Pay A Site Money (Without It Being Clickfraud)? (8)
7:37pm: Judge Rejects Gov't Request For Cell Tower Data, Noting Recent 4th Amendment Rulings (4)
5:36pm: Companies Reach 'Deal' On Net Neutrality... But What Does That Mean? (14)
4:00pm: Thinking About Possibilities: Arcade Fire Tries To Build The House You Grew Up In Into Latest Music Video (8)
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