A Solution

As we mentioned yesterday, the EFF is beginning an anti-RIAA campaign, and unfortunately, they aren’t part of the solution, they’re part of the problem.

Whether it’s the RIAA or the EFF, the major players in these games don’t want to recognize certain unpleasant facts, and until they do, there isn’t going to be an equitable solution.

For a change of pace, let me bring up the RIAA first:

The Horse Is Out Of The Barn: DRM may be able to protect against copying of future recordings, but it doesn’t do a damn thing for past recordings. Since there’s quite a few of those around, and they represent 99%+ of the music around, it’s hard to see how DRM could put much of a damper quickly on that.

Why is A OK and B Bad? If copyrighted material historically enjoyed blanket protection, if there had been no tolerance of copying in any form according to the law, that would be one thing.

However, that’s not so. There are exceptions to copyright protection. Taping off the radio or TV is a big one, and one the MP3ers are well aware of. People often say to me, “Why is it OK to tape a song off the radio, but not make an MP3 copy?” The answer is, “because Congress said one was OK, but not the other.”

It’s legal, but not logical.

Nor is it terribly reasonable to expect people to pay $1 a pop for essentially the same thing they have been downloading for free. It’s more convenient and less time-consuming, but we’re talking about an audience with time on their hands. There’s not enough of a difference between the two for too many current MP3ers.

You’re Dealing With Jailbait

The RIAA’s new tactics would be excellent– against middle-aged, middle-class men.

Unfortunately for them, they aren’t the enemy.

The typical MP3er is a young male who has little money, little respect for laws, and (he thinks) little to lose.

Young men have the bad habit of doing whatever they want to do, and are not terribly deterred by anyone or anything telling them, “No.” Even seeing the negative consequences of others doing the same thing they’re doing often perturbs them not. This is why jails are filled with them.

Actions like lawsuits and arrests that will usually stop someone 35 or 40 won’t even perturb many who are 15 or 20. They’ll just say, “It won’t happen to me.”

The RIAA ought to keep in mind the image of Bart Simpson repeatedly getting burned, but grabbing again and again; then imagine millions and millions of them, with millions more taking the place of those you kill every year. This is the battlefield, and this is the enemy.

Sure, the RIAA can wreak massive destruction on those they hit, but if heaps of casualities don’t even faze the new oncoming waves, you have a problem. Think twice about a war when your enemy has more bodies than you have bullets. {mospagebreak}


EFF: What’s The REAL Agenda?

The EFF seems to be more like Osama bin Laden than Saddam Hussein. They seem to hate the RIAA and Company not for what they do, but for what they are. They don’t seem as interested in MP3ers being left alone or becoming legitimized as much as destroying the music industry as we know it.

For openers, they seem to want to “pay” artists, but not the record companies. Sorry, but if music is a business, the record companies are the investors. They’re really venture capitalists, betting on a lot of acts in the hope that some of them will become goldmines and more than cover the losses on the rest.

It’s a very speculative business; a lot of losses, a few big gains. Record companies just aren’t terribly profitable overall. True, there’s probably more than a little fat in there, but if you think profit is evil, then Intel is the Great Satan compared to these little imps.

You say that record companies rip artists off? Well, royalty terms aren’t much different than for, say, books. Do they extract a heavy price for putting up the front money? Sure, because in a lot of instances, they don’t make it back.

However, the record companies look like money spigots to artists compared to what they’d get if the EFF had its way. You’re left with the impression that there’s an underlying belief that artists aren’t supposed to get rich, and they sure won’t if this ever became the norm. They wouldn’t be above money, they’d be below it.

An artist(s) gets about $2 in royalties per album, about $1 for a single. Keep that in mind when looking at the following:

Ad Revenue Sharing: Anyone running an Internet site knows there’s little money in this.

Bandwidth Levies/Media Tariffs Fancy terms for taxes on Internet access and CD-Rs. The first pretty much boils down to, “Let big business pick up most of our tab.” The second does much the same, if less outrageously.

Digital Patronage This is a fancy term for “donations.” Excuse me, but music isn’t charity. If someone provides a service to you, you ought to pay for it.

Micropayments/Refunds Pay a few cents, then have the right to ask for your money back.

P2P Subscriptions You can see how well Napster did with this formula.

Tip Jars/Micropayments Again, we have artist as mandatory beggar. Pay, but only if you feel like it. Imagine if that were the normal way for people to get paid. Could you see Shaq passing around the hat during an NBA final game?

You notice that anything and everything gets listed except the one where if you want something, you have to pay more than a pittance for it? I mean, forget pricing or anything like that. The notion of paying for an item you want like you do when you go to the store is such a bizarre notion that it isn’t even considered a possible option according to the EFF?

Shouldn’t that tell you something about where these people’s heads are?

None of these approaches is at all likely to even approach the kind of money artists get under the current, terrible regime. The current system may be lousy to artists, but this is worse.

Compulsory Licensing As another possible solution, the EFF apparently wants to create a new class of businessman, the P2P merchant. Record companies would be forced to sell their product to these P2P businessmen at a certain price.

In this particular situation, it is hard to see how this would benefit anyone but the P2P businessmen and lawyers. If the government stays out of pricing, the record companies will charge high fees, just like the Baby Bells charged the DSL companies. If the government does get involved, seeing the price negotiations (or lack thereof) for Internet radio ought to give people pause. If the goal is to reduce prices, they might as well fix the prices the record companies can charge and cut out the middleman.

This is not like cable TV. In this case, the record companies would sell on the Internet just like the P2Pers, rather unlike the broadcast networks on cable.

The only way this could make some sort of sense is if the P2P businessmen eventually became record companies themselves, but there’s nothing stopping people with money from doing that today. Why should the record companies effectively finance their competition? {mospagebreak}


An Alternative Is Emerging

Nobody is being realistic about this. The RIAA is walking into a quagmire, and they are grossly underestimating the resources and time it would take to squelch this.

On the other hand, when at least the vocal part of their enemy is not only opposed to their anti-copying efforts, but their very existence, it’s hard to see an alternative to war.

But there is.

Far, far away from the raging battle, a solution is slowly emerging as technology advances and musical tastes mature.

That solution is quality. People want REAL, uncompromised, uncompressed digital sound tracks, and most are willing to pay for that.

Broadband makes it possible to download uncompressed (or lossless compression) songs in less time than it takes to play them. While storage technology perhaps isn’t quite there yet in the portable formats), a year or two of the usual progress should remedy that problem.

This is where the record companies should draw the line. This is what they should be selling to the public. This is what they should be protecting tooth-and-nail.

Here is what I think would be reasonable.

1) Record companies should be mandated to provide whatever they provide on CD in digital format, on a per-song basis.

2) Record companies should retain the rights to sell their songs, so long as they sell them. If they do not, others would have the right to license the rights to such songs for a (relatively low, to encourage record companies to do it themselves) fee set by law.

3) Artist royalties determined by percentages should be adjusted by law to reflect the different price structure of digital media. (This would both preserve the amount of artist royalties in an era of cost reduction, and would also supercede any real rip-off contracts signed in the past.)

4) There’s really no need for middlemen as the term is currently used (i.e. distributors and stores actually buying the product). What makes much more sense is to allow websites to present and promote music as they see fit, and if people use that website to download songs, the download should come from the record company, and the website should get a small finder’s fee.

5) MP3s? Treat low-quality MP3s and only low-quality MP3s like taping off the radio. Make that a safe harbor for the youngsters, let that be their radio.

6) Boys will be boys, so they’ll still need a cop around to keep them in line. Let the P2P networks become that cop. Give them a legal role, but also give them legal responsibilities. In this instance, tell them they have to be like Napster, and let them keep track of what their members have. Make them have at least some mechanisms in place to get rid of the “new” illegal files (file sizes should make it relatively easy to find and remove most of them). It will never be perfect, so give them a safe harbor like ISPs have: if the RIAA finds something illegal, let them use current procedures to notify the network to have them removed (most likely by throwing them off the network, hey, it works for gaming servers), and tell the RIAA who’s doing it.

These sanctioned P2P networks could charge a small monthly/yearly fee for membership, which can be used to pay the record companies/artists.

7) Much the same can be done for movies. Accept the low-quality, fits-on-one-CD material (or maybe even lower), and that’s it.

I won’t call this ideal, but it’s a lot more realistic than what either extreme has been saying.

Isolate The Bad Apples, Then Make Apple Sauce Out of Them

There are two groups of MP3ers, the reasonable ones, and the unreasonable ones. The reasonable ones aren’t against paying, they just want a better deal than they’re getting now. The unreasonable ones won’t pay, period.

Based on some polling done by others and myself, it seems that a fairly large majority 60-70% are reasonable. It’s pretty safe to say that they would at least not break the rules set forth above.

Then there are the rest. If you ask them, “would you ever pay for digital music” 30-40% of the MP3ing populace would say “No.”

However, of that 30-40%, if what I described above actually became available, I think a lot of that 30-40% would change their minds (especially if it worked out cheaper than buying the occasional CD), and even more of that group would be satisfied with their 128K MP3s (which is pretty much what they’re doing, anyway).

That leaves a much smaller group that basically would say, “To hell with your laws. I want the best, and I’m not paying for it.”

And the answer to that group is very simple. “We’ve made flexible high-quality music available for a price. We’ve set the rules and harmonized them with other legal forms of copying. We’ve provided a legal free option. That’s not good enough for you? Tough. Now we’re going to nail your thief ass to the wall.”

Crush the few that are left. This is musical warez, and should be treated the same way.

How To Tell A Good Solution From A Bad One

This solution is probably way ahead of its time, and there’s certainly no guarantee this will emerge. We could just as well as years and years of gradually-increasing fighting and lawsuits and arrests and God knows what else.

But here’s a very simple tip to judge proposals.

It’s very simple. Any solution that makes BOTH sides scream bloody murder is at least on the right track. That means both sides have to give up a lot to get what they really need.

That’s what a compromise is; you give up what you like to get what you have to have.

RIAA and Company gives up the low-end stuff in return for serious protection of their intellectual property where it counts. Consumers get the musical flexibility they want, and new choices.

Everybody else gets flushed out so people can see what they’re really after.


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