The major labels are very outspoken about the evils of piracy, and aggressively pursue those who chose to download music and not pay for it. That being the case, there is great ironyin the fact that up to 47% of Sony-BMG’s software is pirated.

Recently, a tech support call for a program called Ideal Migration (a Windows server management tool) was made by a Sony BMG employee, and the product code given was pirated.

The ensuing drama included a seizure of some of Sony-BMG’s assets.? Paul Henry, The CEO of the maker of the software, was quoted as saying “I think piracy is linked to the policy of a company. If the employee has the necessary funding to buy the software? he needs,? he will. If this is not the case, he will find alternative ways, as the work must be done in one way or another.”

Bottom Line: A company that is using pirated software should not be surprised when their products are pirated.

An interview with the Flashbulb about his recent calamity with iTunes, and putting his album up on BitTorrent. It turns out iTunes is selling his albums without permission, and not paying royalties.

The Flashbulb (Benn Jordan) has been releasing albums for 14 years, the last 5 have included various commercial endeavors. The label deal he has is a 50/50 split, but he hasn’t been seeing the money. Benn says he has no agreement with iTunes to sell his music, and many of his fans have told him they bought his music there. When he investigated the issue further, his label asked him to drop it, and his calls went unreturned.

Here’s a great quote from Benn: “Who’s the pirate I should go after? A kid who downloads my album because it isn’t available in non-DRM format and costs $30 on Amazon? Or a huge multi-billion dollar corporation that has been selling thousands of dollars worth of my music and not even acknowledging it?”

Benn is being labeled in the press as pro-piracy, but his true stand is that people buy what they like. “What I’m promoting is the artist’s freedom to choose what can and can’t be done with his/her music, and more importantly, the listener’s freedom to do what he/she wants with their own computer, MP3 player, or internet connection.”

Benn makes a poignant case that the RIAA has spent so long dictating people’s taste and choices that they are now threatened by the opportunity for people to choose the music they want. He suggests that “music will be judged by it’s content again and will be subjected to it’s own Darwinism.”

Bottom Line: Where are all those billions in album sales really going?

The RIAA wants to expand copyright law, with the apparent intention of having more technicalities to prosecute.? The new law on the table is for album compilations.? Specifically, having each track count as separate count of infringement.

Goggle’s top copyright lawyer was quoted saying the parties pushing this bill have an “unslakable lust for more and more rights, longer terms of protection, draconian criminal provisions, and civil damages that bear no resemblance to the damages suffered”.

Bottom Line: Fining someone upward of $9,000 for a track with a value of a dollar may not be fair, but lawmakers still seem to align themselves with this kind of enforcement.

The record industry is at it again, seeking to further limit our use of our catalogs of recorded music. In a current Arizona case, Atlantic vs. Howell, RIAA is now claiming that ripping our own CDs onto our computers for our own use is copyright infringement.

We already have DRM, which limits our enjoyment of music to a platform (iTunes and Windows Media Player are the prime examples of this). This new motion would force us to buy the same song over and over again, to listen to it in our car, on our stereo, on our computer, and on our portable MP3 player.

Is it any wonder that record sales are crashing and burning? Music is not a necessity, and people buy it because they want to enjoy it. The more we are backed into a corner, told that we cannot copy or back up our own music, the greater the backlash toward the record business and the faster album sales slump.

Maybe there’s a totally different angle we’re missing. If the RIAA and the big labels see that their model has failed perhaps all of this litigation is an attempt to squeeze every last penny they can out of us before they collapse under their own weight. All the claims of protecting copyrights and artists may be a sham. The more ridiculous the legal environment about copyright infringement becomes, the more damage is done to artists.

Within five to seven years, there won’t be major labels like there are now, and we will be free to buy the music we want one time and convert it to any format we choose.
However, the resentment that the RIAA is generating toward buying music may be around far longer. Mainstream media outlets tend to only trumpet the loudest voices (in this case the RIAA), and most of the alternative opinions and methods of distributing music are relatively unheard.

Without all of the DRM, root kits, and legal controls of our music catalogs, music will continue to be made and bought. The more restricted our music catalogs become, the less willing we will be to buy it. And who loses is the artist. Musicians make a living off their music. If people are unwilling to buy it, musician will not be viable career. And this backlash hits independent artists even harder. As music loses its value at the mainstream level, it loses it on the underground as well. Artists and labels that do not believe in DRM or controlling the use of their music suffer from the same public opinion that people have toward major labels. The only difference is the major labels positions are available on the newsstand, and to lobby for laws. In fact, indie labels are the second largest entity selling music, and are left with the same restrictions and laws set by the RIAA and the Big Four.

Bottom Line: The continued attempts to regulate music is the biggest source of the current collapse we see in music sales, and the devaluation of music as a commodity.

In the wake of the announcement that Universal and SonyBMG are uniting to start a new download service to compete with iTunes (which will offer 75% of all music sold in the US), Doug Morris, Universal Music Group’s CEO, was profiled in Wired Magazine the other day.

Let’s start with my favorite quote from the article: “There’s no one in the record company that’s a technologist, That’s a misconception writers make all the time, that the record industry missed this. They didn’t. They just didn’t know what to do. It’s like if you were suddenly asked to operate on your dog to remove his kidney. What would you do?” (quoted from Wired article).

Answer: I would find a veterinarian. The head of the world’s largest record company claims ignorance of the fundamental shift in the entertainment industry over the last decade. I find it interesting that the largest music company on the planet was unable to prepare for the digital revolution. Ignorance may be bliss, but you’re still dead when the falling piano you don’t see hits you.

As if that isn’t ironic enough, Morris goes on to say “We didn’t know who to hire… I wouldn’t be able to recognize a good technology person, anyone with a good bullshit story would have gotten past me.”

Perhaps this is why you have twenty VPs, Mr. Morris. What good is an army of executives if they are incapable of determining who to hire and what to do? Mr. Morris makes it obvious how major labels have destroyed their business model and viability.

For years, Doug Morris has been railing for stringent enforcement of copyrights (the ones his company has been taking form artists for decades), and he was at the source of Universal attacking Yahoo, YouTube, and Myspace for their flippant distribution of corporately owned content. This powerful industry insider has the pull to force companies to give him what he wants: licensing fees, commission on Zune sales; the most powerful man in the music industry calls the shots. And now he’s changing his tune, embracing digital technology. It isn’t for the benefit or convenience of audiences though, it’s an attempt to consolidate the digital realm.

The article discusses how iTunes pulled the wool over Morris’ eyes. Since Universal could not find anyone with a technology background to advise them, they (and Morris) never saw the power Apple’s iPod would have to control the industry. Considering how much music is sold on iTunes, that can only be played in iTunes and iPods, this is probably the first time anyone successfully put the Big Four on the defensive. Major labels had free reign to do whatever they wanted and completely controlled the market, one day they woke up and realized out they weren’t in control anymore. It was a conscious choice not to hire anyone who knew about the internet, and not to adapt to a shifting industry. Controlling massive catalogs and marketing muscle isn’t enough. They want every penny, and they don’t care if we know it.

Here’s another great quote: “It was only a couple of years ago that we said…an album that someone worked on for two years, is that worth only $9, $10…?” People never really understand what’s happening to the artists. All the sharing of the music…Is it correct that people…fill up these devices with music they haven’t paid for? If you had Coca-Cola coming through the faucet in your kitchen, how much would you be willing to pay for Coca-Cola? ….That’s what happened to the record business.” (quoted from the Wired article).

While this is a noble sentiment, in reality artists are not making a ton of money off of these deals, at least to compared to what the record companies reap. While we all want to support hard working artists, it’s difficult to find compassion for a seven billion dollar a year company. Sometimes audiences forget that artists are human beings when faced with the behemoth of major labels squeezing us for every penny they can. It’s even more difficult to feel sorry for these companies that own and control the rights to artists like Jimi Hendrix, Bob Marley, Pink Floyd, Miles Davis, and timeless artists that sell with or without marketing.

Doug Morris started out as a producer and a songwriter. Considering his roots, it’s surprising that he has such scorn for the future of music, and the satisfaction of audiences.

If the CEO of the largest record company on the planet is only interested in a fast buck, and is indifferent to the long term future of the music industry, what hope do the Big Four have?

The article concludes with a picture of Doug Morris’ frustration. Hhe considers his job to be developing new talent, not providing convenience for audiences, or adapting his company to the current environment. The CEO of Universal Music Group doesn’t want to be bothered with the transformation of the music industry. And that is the culture of major record labels. They don’t care whether we enjoy the music we have, or that it’s delivered to us in a format that works. They are merely interested in a fiscal bottom line for this quarter, and controlling the media we have access to.

Now that the Big Four can’t even count on multi-platinum talent to stay with them, the end is near. I’m not sure why Doug Morris allowed himself to be profiled. This article is a clear picture of how major labels have destroyed their own credibility, their business model, and their future.

A special thank you is in order to Wired Magazine and Seth Mnookin for this fantastic article. You have allowed us see the man behind the curtain, and he’s everything we’d expect him to be.

Bit Torrent throttling is becoming a real issue. Although it has not yet seen much mainstream attention, controlling users access to internet bandwidth is a disturbing precedent to flow of free information. Seemingly an effort to control the illegal sharing of files, the impact of throttling can be far reaching.

Somewhere around a third of all web traffic is Bit Torrent File Sharing. Keep in mind that a significant amount of Bit Torrent traffic is legitimate, such as file backups for large companies, or as a tool for academic research. A neurocognitive scientist posted on the DSLReports forum how bandwidth throttling is hindering scientific research in a field where leading researchers live great distances from each other. In other words, limiting people’s ability to use their internet waves affects more than porn and Britney Spears.

People transferring large files across the internet can affect other uses online experience negatvely. However, if the uses are legal (and more and more users of Bit Torrent are using it for legal purposes), what legal right do ISPs have to limit our uses of their service? As Slashdot elegantly posed the question in February, “Do they want to irritate their BitTorrent-using contingent, or let BitTorrent flow unhindered at the risk degrading the experience of those who don’t download torrents?’”

Comcast, the # 2 internet provider in the United States, is being served a class action suit for limiting the bandwidth of Bit Torrent users. The suit alleges that it is a breach of contract for a user’s bandwidth to be limited. “The filing asserts that Hart upgraded his internet service to Comcast’s high-speed internet… package in September 2007 to gain faster speeds specifically for the blocked applications in question. In the subscriber agreement… none of the terms stated that Comcast would impede or limit the blocked applications.” (quoted from the Half Life Source article).

According to the The Consumerist, A recent internal ComCast memo gave call senter emplyees a strict script to deliver if customers had questions. Any employee who says anything not in the script would be subject to immediate termination. Adding oddness to the issue is a recent MSNBC article that shows tests confirm the throttling is happening.

Recently, a major Canadian ISP admitted they have been throttling Bit Torrent traffic for months, even going as far as to refuse service to users that consume large amount of bandwidth. An analysis on Bell Sympatico’s tactics can be seen on p2pnet.net.

The CEO of Bit Torrent, Ashwin Navin, said in an interview that throttling is “a symptom of a larger problem”.

Net Neutrality – Not just a fancy term

Network neutrality “…refers to a principle that is applied to residential broadband networks, and potentially to all networks. Precise definitions vary, but a broadband network free of restrictions on the kinds of equipment that may be attached and the modes of communication allowed…” (quoted from Wikipedia).

Simply put, once companies can set limits on our ability to use the internet, where will it stop? Once the door cracks open, how do we close it?

I can sympathize with broadband companies that are concerned with Bit Torrent users sucking up all their bandwidth. It can get quite expensive to have to conitnually upgrade internet servers to meet capacity. The same thing happens in grocery stores when they have to open another checkout line. In capitalism, we often refer to this as “the cost of doing business”.

Bottom Line: Bit Torrent is the biggest single use of internet traffic. ISPs can save lots of money by throttling our use of bandwidth, or charging us if we pass monthly limits. To do so based on what we are doing violates network neutrality, and sets a precedent for controlling the internet.

Our friends at The Seminal caught our attention with their take on the RIAA “victory”.? I put the word in quotes because the nature of a victory is that it advances your cause in some way.

I invite you to check this astute commentary. Here’s my favorite part:

“That’s right, the artists who slave for years to make records, pour out their souls into their CDs, and enrich our lives in a myriad of ways don’t actually get any of the money recovered through these ridiculous lawsuits. Not one red cent.”

The commentary on this case is already so powerful, there;s little left to add.

Over the next few weeks, we will begin to look at other ways artists and musicians can generate revenue besides signing their futures over to transnational behemoths, and the future of record labels.

This fantastic editorial by Tony Long is a powerful and accurate assessment of the fallout of the lawsuit against Jammie Thomas.? His analysis is so good that I have little to add.

Peep it for yourself.

Good show, Tony!

Folks, this has gone too far! $222,000 for 24 songs? Please read this article:

*****

By David Kravets | October 04, 2007
(Repost from WIRED Magazine)

DULUTH, Minnesota — Jammie Thomas, a single mother of two, was found liable Thursday for copyright infringement in the nation’s first file-sharing case to go before a jury.

Twelve jurors here said the Minnesota woman must pay $9,250 for each of 24 shared songs that were the subject of the lawsuit, amounting to $222,000 in penalties.

They could have dinged her for up to $3.6 million in damages, or awarded as little as $18,000. She was found liable for infringing songs from bands such as Journey, Green Day, Aerosmith and others.

After the verdict was read, Thomas and her attorney left the courthouse without comment. The jurors also declined to talk to reporters.

The verdict, coming after two days of testimony and about five hours of deliberations, was a mixed victory for the RIAA, which has brought more than 20,000 lawsuits in the last four years as part of its zero-tolerance policy against pirating. The outcome is likely to embolden the RIAA, which began targeting individuals in lawsuits after concluding the legal system could not keep pace with the ever growing number of file-sharing sites and services.

“This is what can happen if you don’t settle,” RIAA attorney Richard Gabriel told reporters outside the courthouse. “I think we have sent a message we are willing to go to trial.”

Still, it’s unlikely the RIAA’s courtroom victory will translate into a financial windfall or stop piracy, which the industry claims costs it billions in lost sales. Despite the thousands of lawsuits — the majority of them settling while others have been dismissed or are pending — the RIAA’s litigation war on internet piracy has neither dented illegal, peer-to-peer file sharing or put much fear in the hearts of music swappers.

According to BigChampagne, an online measuring service, the number of peer-to-peer users unlawfully trading goods has nearly tripled since 2003, when the RIAA began legal onslaught targeting individuals.

At the time, BigChampagne says, there were about 3.8 million file sharers trading over the internet at a given moment. Now, the group has measured a record 9 million users trading at the same time. Roughly 70 percent of trading involves digital music, according to BigChampagne.

The case, however, did set legal precedents favoring the industry.

In proving liability, the industry did not have to demonstrate that the defendant’s computer had a file-sharing program installed at the time that they inspected her hard drive. And the RIAA did not have to show that the defendant was at the keyboard when RIAA investigators accessed Thomas’ share folder.

Also, the judge in the case ruled that jurors may find copyright infringement liability against somebody solely for sharing files on the internet. The RIAA did not have to prove that others downloaded the files. That was a big bone of contention that U.S. District Judge Michael Davis settled in favor of the industry.

Thomas, 30, maintained that she was not the Kazaa user “Tereastarr,” whose files were detected by RIAA’s investigators. Her attorney speculated to jurors that she could have been the victim of a spoof, cracker, zombie, drone and other attacks.

The jury found her liable after receiving evidence her internet protocol address and cable modem identifier were used to share some 1,700 files. The hard drive linked to Kazaa on Feb. 21, 2005 — the evening in question — did not become evidence in the case.

According to testimony, Thomas replaced her hard drive weeks after RIAA investigators accessed her share file and discovered 1,702 files. The industry sued on just 24 of those files.

(Courtroom sketch: Wired News/ Cate Whittemore)

*****
Ok, now lets be honest. Songs have always been “free” on the radio. This is because you are forced to listen to advertisements which undoubtedly sway a percentage of the captive audience to go buy the products represented in said advertising.

The idea that downloading hurts CD sales has been disproven. In Fact, there have even been several cases where a song breaks on the internet and causes a landslide of physical sales. Shitty music is hurting physical sales. Ask anyone on the street, Mr. RIAA. What we are witnessing here is a truly EVIL organization that is not operating in the best interests of the people it was designed to protect.

Let’s go back to this quote: “This is what can happen if you don’t settle.” That is a direct threat from the RIAA, telling us to conform to their standard, or else be disciplined by their heavily funded hand. I have a response for you, Mr. RIAA Lawyer Prick…

…This is what happens when you don’t Settle:

The revolution, the birth of a free nation, the creation of epic works of art, the birth of new technologies and the absolute free and unfettered exchange of information.

RIAA, your #1 client base is who you are attacking. Everyone is watching you, and thinks you are stupid. You will NEVER stop the free trading of music on the internet. You do not control the flow of information, nor are you operating in the best interests of those you claim to represent

Black markets flourish when consumer demands arent met by governments or corporations (look at prostitution or the war on drugs). We will always share music! We used to do it with cassette tapes, we used to do it with burned CD’s, We will do it by singing at each other if we have to.

This is for everyone:
STEAL MY MUSIC.
SHARE IT.
ENJOY IT.

After all, I wrote it for you.
-r