Tag Archives: music industry

DRM litigation bait

Surely some enterprising plaintiff-side attorney can generate a lawsuit from the reasonable expectations of consumers to continue to have access to the music they paid for:

Customers who have purchased music from Microsoft’s now-defunct MSN Music store are now facing a decision they never anticipated making: commit to which computers (and OS) they want to authorize forever, or give up access to the music they paid for. Why? Because Microsoft has decided that it’s done supporting the service and will be turning off the MSN Music license servers by the end of this summer.

MSN Entertainment and Video Services general manager Rob Bennett sent out an e-mail this afternoon to customers, advising them to make any and all authorizations or deauthorizations before August 31. “As of August 31, 2008, we will no longer be able to support the retrieval of license keys for the songs you purchased from MSN Music or the authorization of additional computers,” reads the e-mail seen by Ars. “You will need to obtain a license key for each of your songs downloaded from MSN Music on any new computer, and you must do so before August 31, 2008. If you attempt to transfer your songs to additional computers after August 31, 2008, those songs will not successfully play.” …

Bennett insists that MSN Music keys are, in fact, not yet expiring. Technically speaking, that’s true—if I authorize one of my PCs, never get rid of it for the rest of my life, and never upgrade its OS, I will be able to play my tracks forever. But as some of our readers note, this technicality is not rooted in reality—the authorizations will now expire when the computer does, for whatever reason.

quoted from DRM sucks redux: Microsoft to nuke MSN Music DRM keys, Jacquie Cheng, 2008/4/22, Ars Technica; connecting link from somewhere i forget

more artist innovation in music distribution

A NYT blog is reporting that Radiohead is making digital copies of its next album available for pick-your-own-price amount — and the best part is they’re DRM-free.

Commenters on the post were almost all positive. A few salient points pulled out of comments:
* This will generate fans for and interest in its nice physical artifact versions of the albums — which are for sale for a fixed price, offering a solid profit point;
* This offers would-be downloaders an opportunity to get authorized DRM-free music at a reasonable price — a sort of come-in-from-the-cold attitude that, however small, will generate more revenue from these downloaders than they otherwise would have had;
* 100% of the proceeds — however small — are going to Radiohead, rather than 5-10% of the cost of a $15-$20 CD.

DRM-less online music sales and other good news

Well, Steve Jobs certainly looks prescient, what with EMI dropping DRM for its iTunes sales. Why do I suppose they were already in negotiations when Steve Jobs wrote his editorial?

Never mind, it’s still good news. (As is the decision from the Supreme Court on EPA’s responsibility to regulate greenhouse gases, a case that worried me. Yes, Virginia, if masses of scientific evidence show that human emissions are harming the environment, then the Environmental Protection Agency needs to deal with it.)

CD sales up, down, irrelevant

The large corporate music industry has been whining to all the major media outlets that its CD sales are down. Accordingly numerous stories have been written in the last month about the trials and tribulations of the industry, whose dreadful loss of CD sales hasn’t been made up by the sale of individual songs.

First – I note that the transition (back) from albums to songs is touted as a bad thing, somehow. This, I really don’t get. The vast majority of commercial albums produced in the last forty years have not been “albums”, but collections of (a) hits, (b) a few noncommercial interesting songs, and (c) several filler songs, in varying proportions. These artists were being forced to produce albums when they wanted to produce songs. It’s as if every short story writer were being forced to write massively long novels.

That’s actually not a good model for creativity or quality artistic production. Why would anyone bemoan this transition? The more viable economic models and methods of distribution there are, the better. Now, artists can produce songs, longer pieces, albums, etc., according to their degree of inspiration.

It really bugs me when people (read: middlemen businesses) get so wedded to particular models that they act as if those models are the natural, One True Way, despite manifest evidence to the contrary. I’ve grown used to this absurdity in terms of the music industry thinking they have a god-given right to sell music as if it were on degradable media to consumers who do not have quality reproduction material — to force us all to live in the 1950s, in other words. But you’d think that in at least one area, they would welcome what is obviously good?

Second – it may all be just so much BS anyway. Yes, the major record industries are reporting CD sales down (and their numbers have proven oh-so-trustworthy in the past), but Harold Feld at Public Knowledge is reporting on information from CD Baby that sales are up — for independent musicians. In other words, long tail economics are at play here: The top part of the curve may be flattening out to some extent (and Feld reminds of us of some of the reasons that the late 1980s/early 1990s were a golden age for CD sales) but music overall is more a part of our lives than ever.

reflections on the demise of Tower Records

“We’re going to have discounts for consumers to enjoy as they’ve never been seen before in the history of Tower Records,” said Andy Gumaer, president of Great American Group, a Los Angeles-based firm that won the auction …. [LAT 10/7]

Yeah, right.

Last night I stopped by Tower Records to see if I could pick up any deals at their going-out-of-business sale. Yow. No wonder they’re going out of business, when their average CD still costs $18-$20. Take 20% off of something that is 50% overpriced to begin with and, let’s see, do the math — it’s still really overpriced.

I know I signed up for that class action settlement on overpriced CDs (and I never got my check for that, by the way, which would have been a vast underpayment for my ~ 1000 CD collection, no small portion of which was purchased at Tower Records … but it would have briefly afforded me some moral feel-goodness). So what happened? Shouldn’t that have done something to get the prices to something approaching rationality? But no, I guess after the settlement the record companies paid attorney’s fees and shipped multiple copies of the same overstock crap albums to libraries and schools … and then everyone continued merrily on overpricing CDs.

Of course, Tower blamed it on illegal filesharing. “Can’t compete with free.” No, Tower couldn’t compete with reasonably priced. Amazon.com is cheaper even with shipping costs, and iTunes offers 12-track albums for $11.88 on a per-track basis or just skip the tracks you don’t like.

But Tower didn’t have to out-compete Amazon.com and iTunes. Most folks don’t mind paying some kind of premium for brick-and-mortar, which gives you an actual place to go for retail therapy or as part of a date, offers physical browsing and interacting with other people … So a reasonable premium might be, what, 10, 20%? Not the $18 CD. In this market, it’s amazing Tower has lasted as long as it has.

… The LAT (10/22) nicely summed up the goods and bads of this. After driving out all the local record stores with predatory pricing and economies of scale, Tower increased its own prices and proceeded to mismanage itself into bankruptcy. But it was a good record store in terms of selection. So Tower’s demise leaves us with sucky chain record stores and the big-box retailers who “out-chained” Tower and sell only “the hits” — a market that is obviously dwindling.

And the other thing I couldn’t help but notice as I wandered through the vast aisles of youth-oriented crap: There are vast aisles of youth-oriented crap. So what marketing geniuses decided to target the 15-20-yo boy market? Who decides, hey, let’s pick a small age group (a scant 3.4% of the population [US Census Bureau / 2005]) without a very high income, and make them our target demographic? … and the music & movie industries complain about filesharing. Geez.

divine licensing: god and the gang of four

Two great tastes that taste great together.

Many “Daily Show” fans (well, okay, me) have been concerned about the future of “This Week in God” now that Stephen Colbert is leaving “The Daily Show” for his own spinoff. Today’s NYT (10/12) explains that the segment is going to stay, but with a new correspondent — apparently, because of divine licensing:

“God has an exclusive licensing agreement with ‘The Daily Show,’ ” Mr. Colbert said. “We’re trying to get the Devil for our show.”

In completely unrelated entertainment news, Slate informs us (10/5) that the Gang of Four is covering their own songs on what is effectively a tribute album by the Gang of Four, in tribute to the Gang of Four. (Hey, I think they’re worth it.) Go4 was a little less happy with their licensing arrangement than God, apparently:

A sraightforward repackaging of the old recordings, such as a compilation or box set, would only serve to enrich EMI, their original record company in the United Kingdom. And that’s something Gang of Four didn’t want to happen. “We have never made any money at all from record sales with EMI and still have unrecouped advances,” King wrote in an e-mail. “So we didn’t want them to benefit as they did nothing to support us.” As for their original American record company, Warner Bros., King claims that they deleted Entertainment!—easily one of the 50 most powerful and influential rock albums of all time—in 1993 and only rereleased it in 2005 in response to Gang of Four’s having become a fashionable reference point. Rerecording the songs—something that contracts typically allow artists to do after 20 years—puts Gang of Four in a strong bargaining position for negotiating a new deal with superior royalty rates. “It is our way of reasserting ownership of our own material,” says King.

covers & licenses to cover

Slate just ran an article on cover albums (“Copycats – The cover album makes a comeback” by Franklin Bruno, 2005/6/23), which is interesting timing considering that the Register of Copyrights has proposed to eliminate the compulsory cover license. [Lessig covers (ahem) the issue and responds to commentary from Importance of Being Ernest and Joe Gratz].

grokster

well — grokster is out. from the beginning:

We hold that one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties.

and from the end:

There is substantial evidence in MGM’s favor on all elements of inducement, and summary judgment in favor of Grokster and StreamCast was error. On remand, re-consideration of MGMís motion for summary judgment will be in order.

J. Souter wrote the majority opinion which apparently and not surprisingly developed an “inducement” theory. Breyer concurrence (with Souter & O’Connor) and Ginsburg concurrence (with Rehnquist and Kennedy).

I saw it here [on Joe Hall's NQB2] first.

lots of discussions (confession: i haven’t had time to read them yet; just the opinion; my thoughts on metablog commentaries may come later tonight):

my own quick thoughts:

  • This outcome is no surprise. It seemed obvious that the Court was going to take a middle position that would take some kind of bite out of Sony; the real question was how big a bite.
  • So how big is this bite? The Court established an inducement standard, setting out the facts implicating Grokster et al’s knowledge and intent to have copyrighted files copied. The battle for the next few years or decades will be to expand or constrict this standard to the facts of Grokster.
    • The inducement standard is treated as part of the contributory infringement standard in one place, (p.12), but elsewhere as a third test parallel to contributory and vicarious.
    • The new inducement standard on the one hand might not be horrible, if it is limited to the facts at hand: It was certainly clear that Grokster et al intended to follow in the footsteps of Napster. Modeling your entity after another entity that was successfully characterized as a “bad actor” now looks like not so good an idea.
    • But on the other hand, the evidence cited in some instances is pretty patchy/sparse:
      • The majority opinion cites, for instance, that “Grokster’s name is an apparent derivative of Napster.” p.7, and again at p.21 (“Grokster’s name is apparently derived from Napster…”) If that kind of naming can constitute evidence then every e-business and i-product may someday be in trouble.
      • The majority also cites attempts to capture / buy relevant search engine keywords. (p.7 & p.22)
      • The Court also felt that “the defendants’ failure to develop … filtering tools or other mechanisms to diminish the infringing activity … underscores Grokster’s and StreamCast’s intentional facilitation of their users’ infringement.” I really dislike this and any other pro-network-policing implications.
    • More generally, though, I am still concerned with the dotted line this opinion implicitly draws around design decisions. It should be permissible to design your product around precedents, to avoid clearly unlawful behavior. It can and should be permissible to push that boundary in new directions — new innovation proceeds by pushing old boundaries. In the case of copyright infringement, pushing a boundary too far carries its own risk: that you might fall afoul of that boundary and be found liable for copyright infringement. But here, acknowledging the design decisions is evidence in and of itself of “inducement”. That’s troubling, because it requires that designers adopt a willful blindness attitude very similar to that which Judge Posner decried in Aimster. And it could make it difficult to defend and describe innovations in court.
    • I’m also concerned with the very notion of including an intent-based standard in copyright. Copyright is a strict liability regime. Liability is thus quite broad: any actual infringement creates liability, regardless of intent. Adding an intent-based liability to the further-afield secondary liability broadens copyright even further. The Court did attempt to address this, at p.19:

      We are, of course, mindful of the need to keep from trenching on regular commerce or discouraging the development of technology with lawful and unlawful potential. Accordingly, just as Sony did not find intentional inducement despite the knowledge of the VCR manufacturer that its device could be used to infringe, 464 U. S., at 439, n. 19, mere knowledge of infringing potential or of actual infringing uses would not be enough here to subject a distributor to liability. Nor would ordinary acts incident to product distribution, such as offering customers technical support or product updates, support liability in themselves. The inducement rule, instead, premises liability on purposeful, culpable expression and conduct, and thus does nothing to compromise legitimate commerce or discourage innovation having a lawful promise.

      Yeah, we’ll see. Here’s hoping the Court is right in its optimistic assertion that its new inducement “does nothing to compromise legitimate commerce or discourage innovtaion having a lawful promise”.

    • The Court also played dangerously with the numbers game, citing “the number of infringing downloads that occur every day using StreamCast’s and Grokster’s software” as a “powerful… argument for imposing liability”. At 12. And again at 23: “As the account of the facts indicates, there is evidence of infringement on a gigantic scale, and there is no serious issue of the adequacy of MGM’s showing on this point…. ”

      These lines will certainly appear in content-owners’ briefs and attempts to get courts to consider the quantity and volume of infringement — the very standard rejected in Sony.

    • The Court states that neither of the Sony uses (recording TV off-air, and librarying programs) was “necessarily infringing”. (p.14). So presumably new uses are not “necessarily infringing”. But wouldn’t this have applied to Napster? Personal file sharing, of degraded-quality MP3s, without commercial exchanges — that was a new use, and not a “necessarily infringing” use. Ah, this is going to beef up the market prong of the fair use test, I bet. Like it needs any more beefing.
    • The Court restricts Sony to contributory infringement not vicarious liability. Some courts assumed so anyway, but Posner in Aimster pointed out that it was really unclear. Grokster resolves that unclarity by describing Sony as merely about contributory infringement, not about vicarious liability.

      On those facts, with no evidence of stated or indicated intent to promote infringing uses, the only conceivable basis for imposing liability was on a theory of contributory infringement arising from its sale of VCRs to consumers with knowledge that some would use them to infringe. Id., at 439.

      at 14. And later at 16-17:

      [The Ninth Circuit's] view of Sony, however, was error, converting the case from one about liability resting on imputed intent to one about liability on any theory. Because Sony did not displace other theories of secondary liability …

    • On the other hand, the Court seems to want to leave Sony otherwise untouched:

      Because Sony did not displace other theories of secondary liability, and because we find below that it was error to grant summary judgment to the companies on MGMís inducement claim, we do not revisit Sony further, as MGM requests, to add a more quantified description of the point of balance between protection and commerce when liability rests solely on distribution with knowledge that unlawful use will occur. It is enough to note that the Ninth Circuitís judgment rested on an erroneous understanding of Sony and to leave further consideration of the Sony rule for a day when that may be required.

      at 17.

      Added commentary (6/28):

      The real problem is that while the Court leaving Sony untouched in name only, the Court manipulated the entire environment in which Sony lived. Sony, as it played out in the real world, stood for the generic proposition that secondary liability for developing & distributing a technology accrued only where there were no “substantial noninfringing uses” to the technology. The fact that Sony was vague on the vicarious / contributory distinction was fine — it created a grander position for the Sony standard vis-a-vis secondary liability generally. Technological development ought not be held hostage either to existing business models or to those who seek to get around the existing business models.

      Despite the Court’s intentions, Grokster chips away at Sony in two ways: First, the Court hones down the vagueness and wiggle room in Sony by construing it as a contributory case. Second, the Court opens up an entirely new avenue for secondary liability, one with (as yet) no pro-technology out. So, now technology developers, instead of being able to rely on a general, broad principle of protection for multiple-use technologies, have to watch out for both vicarious liability and the new (to copyright) inducement standard.

      The protection for technological development is gone. So what if Grokster developed its technology intending to foster copyright infringement? Once the technology is out there, it started being used to, yes, share noninfringing materials. And those uses will continue to grow and evolve. On some level, Grokster the company is merely an agent for technological evolution. But this decision is not aimed at the agent; it’s aimed at technological evolution itself. If they had wanted to aim at the agent, then they could have restricted their theory to the inducing acts and words — not to the development and distribution of the technology. How much did Grokster’s ad campaigns actually induce infringement? And how much did the mere capability of the technology “induce” infringement? Unfortunately this decision doesn’t (at first reading anyway) lend itself to focusing on the acts. It looks at the acts, but it targets the technology.

      < / end of added commentary >

    • I don’t like footnote 13:

      It is not only that encouraging a particular consumer to infringe a copyright can give rise to secondary liability for the infringement that results. Inducement liability goes beyond that, and the distribution of a product can itself give rise to liability where evidence shows that the distributor intended and encouraged the product to be used to infringe. In such a case, the culpable act is not merely the encouragement of infringement but also the distribution of the tool intended for infringing use.

  • Concurrences:
    • Breyer/Souter/O’Connor concur with the majority but disagree with Ginsburg’s concurrence (Ginsburg/Rehnquist/Kennedy) evaluating Grokster’s potential liability for “contributory infringement”. Breyer agrees with the inducement carve-out, but separately finds that Grokster meets the Sony test for contributory infringement.

      On the other hand, Breyer regularly cites the quantity in Sony — which suggests that even though he is supporting Grokster in this discussion, he has bought into the quantitative analysis anyway. However Breyer does clearly point out that 10% may not be enough, should not be fixed, and that Aimster was a stricter interpretation of Sony than he would have put forth.

      Breyer’s opinion is ultimately the most thoughtful and most directly engages the policy balances at stake. And, demonstrates the most familiarity with the record.

    • Ginsburg: I really take issue with this concurrence. How can J. Ginsburg say

      Here, there has been no finding of fair use and little beyond anecdotal evidence of noninfringing uses. … These declarations (some of them hearsay) include assertions that number of copyright owners authorize distribution of their works on the Internet and that some public domain material is available through peer-to-peer networks.

      (at 5) The fact that Rick Prelinger and Brewster Kahle have not personally used the P2P networks is used against them! Merely providing content which they authorized for distribution over P2P networks was not enough. Contrast Sony: If Ginsburg had been writing it, apparently Mr. Rogers’ statements that he was happy to have his content copied would not have been sufficient. No, Mr. Rogers would have been required to have actually used VCRs to tape his materials off air.

      Apparently all public domain and permissive filesharing constitutes “anecdotal evidence of noninfringing uses”. But shouldn’t distribution of teachers’ guides, satires, etc., count as fair uses? Oh — someone needs to make the compelling case for fair use filesharing! But I suspect nothing would persuade J. Ginsburg. Even blind orphans from Tanzania who get copies of works not otherwise available in Tanzania may not merit a tear if weighed against the all-important interests of large copyright-holding movie companies and cartels.

      Ginsburg is pushing for a reconsideration of quantitative factors, which apparently will look at the state of infringement at the moment the litigation is filed. Needless to say this would stifle and kill all sorts of technological developments.

comments on bootleg browser

Thomas Bartlett’s “Audiofile” [2005/5/5] in Salon.com mentions the “Bootleg Browser” & says this:

Bootleg Browser is a new resource that lists links to MP3 downloads of concerts — currently featuring shows from nearly 350 artists. I’m interested to know how readers feel about the ethics of concert bootlegs. Personally, unless an artist has specifically stated that they don’t want their concerts to be recorded and traded, I have a hard time understanding why anyone would object. There’s no real way that bootleg trading can hurt an artist, and plenty of ways that it can help. Doubtless some of you disagree, and I’d like to hear from you. Write to me.

Good to hear someone making the obvious point that lawmakers & record companies have seemed confused about for years.

old news – ll cool j vs. chuck d

We already knew this, but Chuck D. is pretty cool:

LL Cool J has come out in support of the US music industry’s legal threats music downloaders. LL was speaking to a Senate committee investigating whether the industry has been too heavy-handed .

“My question is, if a contractor builds a building, should people be allowed to move into the building for free?” he told senators.

But fellow rapper Chuck D, of Public Enemy, said people should be allowed to swap songs on peer-to-peer sites.

“P2P to me means power to the people,” said Chuck D. “I trust the consumer more than I trust the people at the helm of these (record) companies.”

The rap star later added: “LL’s a staunch American…but when you solely have an American state of mind, you’re increasingly becoming a smaller part of the world.”

LL Cool J – Supports RIAA Actions : DanceFrontDoor Dance Music [2003/Oct/1]

anti-racist protest also stings anti-bootleggers

While protesting the airing of “The Tsunami Song”, Asian-American rapper Cobra took shots at the anti-bootlegging “whiners”:

Though promoted as an antiracist event, the rally lamented the degraded state of the corporate music industry generally. One of the first performances at the demonstration came from Asian-American rapper Cobra. In front of an audience holding signs reading “Hot 97 Divides Our Community,” “Stop Hate 97″ and “I Am Hip-Hop,” Cobra recited lyrics that earnestly expressed his grievances with the state of hip-hop: “With a hot producer/Hitler would still be popular, blinged-out with Medusa [a popular jewelry brand].” In another song, he castigated greedy artists who fail to recognize the boost in visibility they get from bootlegs and online music traders: “Now you mad ’cause your bootleg’s on the Ave.?/That’s the best promotion team that you’ve ever had!…/You whiners unnerve me/You’re just an old, white exec in a throwback jersey.”

Rap News Network – Hip-Hop Doesn’t Live Here Anymore

‘true name’ bill signed

Sigh. Now i know why i was feeling kinda blue today: On Wed, 9/22, Schwarzenegger signed SB1506, the so-called ‘true-name’ bill, which requires anyone putting copyrighted content on a p2p system to include their name and contact information. [Sacramento: Governor signs Internet piracy bill: E-mail address required to share movies, music online by Mark Martin & Lynda Gledhill — sfgate 9/22]. Certainly it wasn’t a surprise — this bill has been steamrollering through since early this year. But it doesn’t make my day any better.

Highlights: this line from the article:

Last week [Gov. Schwarzenegger] signed an executive order prohibiting state employees from using software designed for file sharing.

Ummm … like TCP/IP? AppleShare? The web? Might make it hard to do business …

And in related news: Donna Wentworth pointed to another recent state-law copyright case [U.S. v. Jean Martignon, 03cr1287 (SDNY 2004)]: The court struck down an anti-bootleg law because it didn’t recognize copyright terms. (Attn, Gov. Schwarzenegger: Is that the drumbeat of p-r-e-e-m-p-t-i-o-n sounding in the distance … ?)

The bill, SB1506/AB (pdf as chaptered), reads:

Continue reading

Computer Industry Lied to Entertainment Industry !!!

chortle. ButtUgly: Main_blogentry_210904_1:

We lied to you

(Inspired by Cory Doctorow’s DRM speech.)

Dear Content Producers and Owners:

We lied to you. In the golden 80s and 90s we told you micropayments and content protection would work; that you would be able to charge minuscule amounts of money whenever someone listened to your music or watched your movie. We told you untruths which we well knew would never work – after all, we would’ve never used them ourselves. Instead, we wrote things like Kazaa and Gnutella, and all other evil P2P applications to get the stuff free.

We told you these things so that you would finance the things we really wanted to build, not the things that you wanted to be built. We knew all along that DRM schemes do not work, and we knew that whatever we create can be broken by us. We don’t care anymore, because your money made us bigger than you.

Look at us: every year, we churn out more computer games than your entire industry is worth. You know how we do it? We like our customers. We don’t treat them like potential criminals, and try to make our products do less. We invent new things like online role-playing -games, where the money does not come from duplication of bits (which cannot be stopped, regardless of your DRM scheme) but from providing experiences that the people want.

We saw that you were old and weak. So we took advantage of it: told you things that you wanted to hear so we could kick you in the head in twenty years. Some of us told you that the future is going to be interactive – what did you do? You started to think how to make interactive movies (CD-I, anyone?), which is not what it really means, while we wrote games and tried to understand the new mediums, not how to bolt it on onto old things.

We lied to you. And we apologize for that, but it was for the greater good. So we’re not the least bit sorry.

Signed: The Computer Industry

(linked from boingboing)