Supremes -- Grokster bad, music industry good
02 July, 2005



By Susan Butler 39 minutes ago

NEW YORK (Billboard) - At the Washington, D.C.,headquarters of the Recording Industry Assn. of America on June27, top officials watched computer screens in the conferenceroom, eagerly awaiting the Supreme Court‘s ruling on what maybe remembered as the most significant copyright case for theentertainment industry; when the news broke at about 11 a.m.,they jumped, whooped and exchanged high-fives.

Meanwhile, in the California bedroom of Michael Weiss, theCEO of peer-to-peer software provider StreamCast, the mood wasmore subdued. Weiss sat, repeatedly refreshing the Web page forthe SCOTUS blog. "I was stunned," he says. "I could not believewhat I was reading. I was surprised I didn‘t hit something. Ididn‘t know what to do: stay home and start working on myresume or go to the office and start taking phone calls."

The two responses pretty much sum up the tone and nature ofthe comments from both sides of MGM vs. Grokster. The Courtsided 9-0 in favor of copyright holders, and against P2P firms.It held that anyone who distributes P2P software with theobjective of promoting copyright infringement is liable for itsusers‘ actions and sent the case back to District Court in LosAngeles for further review.

It has been a long time since such elation has been heardin the voices of major label executives. As the fight againstpiracy continues, the business strategists and dealmakers aremoving full speed ahead to meet the digital demands andchallenges.

"‘Thou shalt not steal‘ -- the seventh commandment --punched through," Sony BMG Music Entertainment CEO Andrew Lacktold Billboard. "Many of us on the creative side have known --have hoped -- that this day would come."

"The court‘s decision should strengthen the resolve of allof those who care about a digital future where artists andsongwriters can be fairly compensated for their efforts,"Universal Music Group president/COO Zach Horowitz said. "We‘vemade significant investments to prepare for that future, ashave so many legitimate services. The Supreme Court decisionvalidates those investments and drives a stake through theheart of services that rely on theft as a key competitiveadvantage."

Reactions were more muted in the indie world, where somelabels felt they had benefited from file sharing.

Even in the file-sharing realm, reactions were mixed, withat least one company, iMesh, seizing the spotlight to announceplans to work with the major labels.

Still, most in the P2P world -- at least those companieswhose software allows widespread unauthorized file sharing --remained resolute.

"It‘s business as usual," Weiss said. "We don‘t induceinfringement at all. We‘re just going to continue to innovateand come up with new products."

While a renewed sense of optimism could be heard throughoutthe industry, no one believes the decision will stop all of thebillions of unauthorized files shared each month on P2Pnetworks. StreamCast says that nearly 140 million copies of itsMorpheus software have been downloaded, and that number justrecently passed the number of Kazaa downloads.

Even if the operators were shut down, P2P sharing onhundreds of millions of "decentralized" networks can continuefor an undetermined number of years.

Still, because of the strong language of the Supreme Court,Congress is not expected to respond with legislation. So, tolead music fans away from illegal downloading, "you have tocreate a pathway for the consumer," said attorney JohnFrankenheimer, co-chairman of Loeb & Loeb. "There are alreadylegitimate ways of downloading, such as iTunes and now Yahoo.Just as importantly is the emergence, I‘m sure by the end ofthis year, of legitimate P2P services, which will be farsuperior in terms of the experience than anything on theillegitimate side."

Adam Klein, EMI Music executive VP of strategy and businessdevelopment, said that now is the time "to get our eyes focused100% where they should be focused, which is creating the rightproduct for consumers."

He added that EMI also anticipates working with all thelegitimate services. "Anybody who wants to get into seriousconsumer offerings that make sense and that are legal, we willbe with them 100%."

Horowitz added, "None of us is so naive to think thatdeveloping compelling alternatives that excite consumers is aneasy task. But alternatives exist already and will become evenbetter in the months to come. Universal and all the majors willcontinue to experiment and make their music available as newapproaches show promise."

Edgar Bronfman Jr., chairman/CEO of Warner Music Group,said in a statement, "As a music company, we fully understandthat our ultimate success lies not in preventing people fromgetting what they want but in providing it to them in new andexciting ways. We must strike a balance, one that nurturestechnological innovation while at the same time protecting thevery content that inspires innovation in the first place."

Lack said he expects some of the illegal P2P operators, whohad no incentive to offer only authorized files before thiscourt decision, may soon move over to the legal space. Hebelieves the decision makes it very clear what makes Groksterillegitimate and what makes iTunes legitimate. "People can nowrecognize very easily which is which," and he will do businesswith the legitimate ones.

As the industry moves forward encouraging consumers to buymusic, the fight against piracy continues. The labels filed 784more suits against file sharers June 29. While sources close tothe Grokster litigation told Billboard that specific plans havenot been finalized, they expect many more lawsuits to be filedagainst users who share unauthorized files.

Horowitz emphasized that the lawsuits are being filed firstand foremost to educate consumers as one part of the overallprocess geared to create a more level playing field forlegitimate services.

"The labels understand that this is not a battle we winjust by bringing lawsuits," he said. "We win by making ourmusic available to legitimate services that are compellingenough to entice the consumer to use those services rather thanthe illegitimate ones."

Lack hoped the Supreme Court decision would, in one or twoyears, make lawsuits over file sharing a thing of the past.

Reuters/Billboard - obviousnews.com

sure a lot of mulit-syllabol words in there...

Hey Media Moguls! Wanna compete? Knock off the DRM and charge a fair price!

Or better yet, keep doin' what you're doin'.....till you drop.

"‘Thou shalt not steal‘ -- the seventh commandment --punched through"

Why? Are we also being accused of getting in the sack with Hilary Rosen?

Damn it, people...if you really don’t know your Commandments, you shouldn’t be making fools of yourselves.

In fact, keep it up—we’ll be glad to use any and all foolishness against you.

"The court‘s decision should strengthen the resolve of allof those who care about a digital future where artists andsongwriters can be fairly compensated for their efforts,"Universal Music Group president/COO Zach Horowitz said.

Are they serious???? If they gave 2 shits about the artists, they'd start by giving them more than a $1.50 from every album sold. They're the real thieves. Lying bastards.

"Reactions were more muted in the indie world, where somelabels felt they had benefited from file sharing."

Some??? More like pretty much every label who isn't suing its own customers. It's been proven that downloading doesn't hurt sales, and the indies are smart enough to realize this.

"There are alreadylegitimate ways of downloading, such as iTunes and now Yahoo."

WHAT??? Yeah, and they rip you off buy selling you a lossy, DRM-infected file you can't even use the way you want. At least filesharing has a better selection AND doesn't give you bad downloads.

Sony/BMG is spouting a commandment:
Thou shalt not steal.
We've got a commandment too:
Thou shalt not KNEEL...to the entertainment cartel.

Amen RattleHead!

Thou Shalt Not Steal?!? How about the 20 bucks you stole from me when I bought a CD?!? You know that same cd that is made down in mexico or in china for like 25 cents? the labels are the thieves, not the file sharers. ITunes, The Sony Music Store, Yahoo, and all the other pay per download music online retailers only have popular music, popular artists. So even if you used those programs, you might not even be able to get the songs you want because they are either rare or not popular, in the eyes of the media!

How much was it that Sony is holding for 30 years for the Bay City Rollers? Something like £50 million?

And this asshole has the balls to quote "Thou shalt not steal"?

He probably yells "Thou shalt not commit adultery" while he's nailing his secretary.

"We win by making our music available to legitimate services that are compelling enough to entice the consumer to use those services rather than the illegitimate ones."

I am neither compelled nor enticed. I am insulted and repelled.

Pay the artists, Andrew, or you lose.

how about thousd shalt not covet

what the hell happened to my kheybouard? damnd ekxstra lebdters...

The criminals are RIAA and the other bunch of members. They act like the Mafia and they hire lying lawyers they can control. They keep fighting people who have now choice to hear what they want. The time you can only hear and purchase the crap the executives from the music companies produce is getting over! And i won't pay for a 'legal P2P service'! The price is to high, it is infected with DRM shit and again you can only get the music they want! The RIAA assholes will continue go after the real music lovers until they run out of money or get killed!

While it is true that the iTunes and others have DRM in them, I'll bet that someone with an entrepreneurial spirit could start marketing an analog to digital converter to capture the decrypted sound and make it digital (mp3 format) again to get around the DRM.

Of course, it couldn't be marketed that way overtly. But, it would still get around all that DRM crap.

However, if I bought it, and I am making a copy of an analog recording that I already own, isn't that legal, even if it winds up back in digital format again? That sounds like "Fair Use" to me.

I don't have any of the iTunes or the DRM clone's crap on my PC, but I would love something like that to start popping up just to stick it up the RIAA's ass another way!

Money talks...........that is why the Supreme Court,et. al. ruled against Grokster!!

Be well all......and SAFE!!!



Mike

Money talks...........that is why the Supreme Court,et. al. ruled against Grokster!!

Be well all......and SAFE!!!



Mike

Achiveing a world where people buy all their content online requires three things now:

1. A payment model. That is now done.

2. DRM. Strong DRM. Not completly strong DRM that noone can break, because that isn't possible. Say, strong enough that 95% of potential customers cant easily break it and give free songs to everyone at school. Sufficiently hard that they would have to spend a lot of time or money on it. It would have to be renewable, so it could be quickly updated if someone wrote an easy to use crack that anyone could use.

3. Sabotage. If that 5% of the users can break the DRM, and 5% of those are motivated, its enough to result in decrypted or otherwise unprotected files floating around. This alone isn't a problem - but if the files are in an efficient distribution system, they become a competitor with the paid-download systems. So any service that allows easy access to great quantities of data without explicitly filtering copyrighted content becomes the instant enemy of the industry.

Right now, thats p2p, and thus the war on it. It will be interesting to see what else might fit that description as technology improves. For example, imagine if in the future there exists a storage media which anyone with a computer and a cheap burner can write, with a capacity incredibly huge by todays standards - say, a few terabytes. Now someone (say, me) then fills this with every mainstream or popular song, book, movie and TV program made over a decade. A couple of those... well, just about any file a person would ever want off p2p would be on there, and anyone who has a copy could easily make another, updating it with new content and adding a new volume every few years. More data than a person could view if they spent their entire lifetime in front of a PC, in a box they could carry around. Social groups could form not around having the latest CD, but mining the data collection for obscure, forgotten gems of entertainment.

Now, how would the industry fight something like that? The only solution I see would be the same way they currently keep people from immersing themselves in old entertainment: Hype and advertising, relentlessly promoting the next blockbuster film or top-of-the-charts album.

goldenpi, I have a practical question. You are proposing p2p or something like p2p combined with larger data storage technology to offer entertainment of all types in mass quantities to the people.

Perhaps this is so, but I know from experience that many of the files on p2p, the music files, are truly horrible quality. Second, I recently saw some of the TV shows that are available on p2p, and again the quality is so bad that for me it is unwatchable. Fuzzy picture, dropped frames and extra frames making motion herky jerky.

Unless you filter out the junk, p2p does not offer much for me, even if it is content I would theoretically want to watch/listen to.

Apparently, at the same time consumer audio and video is reaching new heights of resolution with DVD-A, SACD and HDTV, the public tolerance for poor quality is increasing -- captured MPEG-files of TV shows encoded by idiots, and MP3 audio that sounds no better than cassette tapes.

Never underestimate the quality of picture and sound people will put up with. Frankly, I would be ashamed to trade some of this stuff. I'm too picky, I guess.

It's so funny. They lost and they don't even know it.

Now the P2P programswith no commercial center will increase in popularity, thus, resulting in the loss of any opportunity for the majors to control them.

"Sony/BMG is spouting a commandment:
Thou shalt not steal. "

I'm spouting a commandment right back at them:

thou shalt not kill.

Would whoever stole Britney Spears latest album please give it back? Maybe then they'll shut up.

So, exactly what did Mr. Lack ever create? Anybody know? And the record labels spouting the ten commandments has got to be as low as you can possibly go...how many things have they been guilty of?

"So, exactly what did Mr. Lack ever create?"

Smaller artist rosters.

"...now is the time "to get our eyes focused 100% where they should be focused, which is creating the right product for consumers."

This statement is twenty-five years to late.

Judges are on the bench to interpret law, not to create it.

That being said, technology has advanced very fast in a very short period of time, and copyright laws - particularly those on how the property that is being protected by copyrights - have not been adapted to said technological changes. Sure, the Audio Home Recording Act of 1992 let people record music in the privacy of their own homes, but I don't think Congress looked far enough into the future when they passed this law; they didn't see how big computers would be when it came to acquiring artistic property such as music or movies.

Copyright law needs a serious overhaul - who can own it and for how long, how property can be distributed and how it can be legit or otherwise, and how people who own the copyrights should be compensated. 1955 business models in a 2005 world simply don't work anymore, and neither does 1955 copyright law.

It wouldn't hurt the RIAA, its member companies, and their CEOs to take a college course in business ethics either; maybe they'll learn what big f*ck-ups they've been to the artists they supposedly represent.

"Copyright law needs a serious overhaul - "

AMEN to that.