It's Time for The RIAA to Sing a Different Song

How about "the times, they are a'changing"

By €uromole: Sunday 02 February 2003, 13:45

  IT SEEMS THAT everywhere one looks these days, the RIAA (Recording Industry Association of America), and its counterparts in other countries, are busy blustering their way around and demanding that those who do not commit a crime should be held responsible for it.

They are busy with their demands that Verizon provide the name of a user who may have downloaded some music which may be copyright and they are busy with their allegations about KaZaA music service, a company which has the good sense to challenge the operation of the RIAA.

In the same manner it used in the Napster trial, the RIAA is making wild assertions that gullible media, public and even legal authorities appear to be accepting as fact. So far at least, it has managed to give the impression that everyone apart from its members are to blame for a slump in music sales. It can't be them - it must be those evil people using the Internet.

No doubt the RIAA was emboldened by the judgment against Napster and this gives it the feeling it can flex its muscles at the world at large.

There is little doubt that Napster was guilty of copyright infringement but only directly in so far as they themselves copied music; that Napster had knowledge that users were infringing copyright but only in so far as they could ascertain that copyright applied to certain tracks; that they were guilty of contributory copyright infringement but only in so far as they encouraged users to infringe copyright, and that they were guilty of vicarious copyright only in so far as their income was dependent on the use of copyrighted material.

That they themselves copied music from CD into digital form is not clear. That they knew users were making illegal copies is true, but the means of policing such action was beyond them if they had no list of copyrighted works or any other means of checking. That they encouraged others to infringe copyright is also probably true, but again the exact extent of this and its influence on users is impossible to gauge. That its income was dependent on copyright infringement is an accepted fact but again the exact extent of this is impossible to determine.

For the record, Napster did not store music on its own servers - it simply held the databases of music tracks that could be accessed from users' own systems. The software they offered for peer-to-peer copying between systems was also standard, although some minor enhancements were made to improve the copying of large MP3 files. Providing something as a legitimate use means it cannot be banned on the basis of possible illegal use.

Findlaw.com has an archive of documents related to the trial and they make very interesting reading. Time and time again, there are assertions that Napster caused a slump in record sales but none of the many witnesses - and there were many because the RIAA has deep pockets - presented any more than circumstantial evidence.

How bad were the lies and distortions? The response by Peter S Fader of the Wharton School of the University of Pennsylvania provides an interesting rebuff to many of the witnesses. (You can find it here.)

For example, one music storeowner near Syracuse University in New York attributed a steep decline in music sales to the use of Napster. He forgot to mention that in the time period to which he referred, he had changed his emphasis from CDs to vinyl records and had moved to a new store which was outside the main local shopping area. He later reluctantly agreed that perhaps these were significant factors in his drop in income and that perhaps he was making an assumption about Napster.

In a survey commissioned by the RIAA, the results to open-ended questions (i.e. those with no specific choices) were interpreted with a strong bias towards that association. This survey also concentrated on college and university students then attempted to generalise the results and paint a grim picture. More thorough surveys by other researchers indicated that these "financially challenged" students were not typical Napster users because more than 50% of users were over 30. Scattered through the various submissions are all kinds of assertions that Napster was taking large numbers of customers away from legitimate enterprises. Not one of these submissions produced any incontrovertible evidence that showed a direct connection between the use of Napster and a decline in music sales.

Several musicians who had been either ignored or badly treated by record companies saw Napster as highly beneficial. Some submissions are included in the Findlaw archive but other such as Janis Ian, with 25-years in the recording business, chose to make their own public statements. Janis's two postings can be found here. She notes that Napster created a lot of interest in her work, far more than before Napster arrived on the scene.

Other artists also commented on this phenomenon, a point that dovetails nicely with numerous surveys - including some from the RIAA itself - that showed consumers used Napster for sampling different music. A shock horror tale in one pro-RIAA trial submission was that only 25% of the surveyed users went out and bought the CDs for at least 1 in 4 of the tracks they downloaded. Oddly enough, that corresponds well to the idea of sampling. What a pity the same survey did not ask about deletions of downloaded music too, because a large number of deletions within a few days of downloading would further confirm this sampling.

Various surveys also supported these claims. A survey by Jupiter Communications in July 2000 concluded that Napster users were 45% more likely to have spent more buying music than non-users. This survey was of 2200 online music fans and it found that the only people who were not likely to increase their music purchases were 18 to 24 year old "cash-strapped, computer-savvy users".

Jupiter Communications was certainly not alone in these findings. The consensus was that Napster let people listen to music that they would not otherwise made the effort to consider. As a result, musical tastes spread. Another report mentioned that it made it easy to rediscover artists or to find additional material by them. Both cases meant an increase in sales of CDs and of vinyl records. There were several comments - of course from people outside the RIAA - that Napster looked far more likely to increase music sales than diminish them.

Another reason that students used Napster was that it let them access one or two good tracks on an otherwise forgettable CD. I am sure that we all have CDs that fall into that category. The attitude of the RIAA seems to be that consumers must buy the rubbish in order to get the few small jewels.

The fact that music sales were declining just as the use of Napster was increasing presented the RIAA with the perfect scapegoat, so absolving the music industry of blame and saving it the effort to think there might be other reasons behind the slump.

After Napster died, the RIAA spouted the same assertions about online music, whether or not such opinions were false, ill-founded or unrepresentative.

Here's a typical pronouncement published by DC.Internet during February 2002. "The Recording Industry Association of America (RIAA) is blaming online piracy and CD burning as the major culprits for a 10.3 percent slide in 2001 music sales. According to RIAA data, total U.S. shipments dropped from 1.08 billion units shipped in 2000 to 968.58 million in 2001. … Coinciding with the increase in copying music, the study found that ownership of CD burners has nearly tripled since 1999: in 2001, two in five music consumers owned a CD burner compared to 14 percent who owned one in 1999."

At the same time the RIAA declared the rise in sales of blank CDs was further proof of music piracy, and that blank CD sales should be curtailed.

Let's dispose of this whole nonsense about CD burners and blank CD sales quickly and then move back to the more important issues.

Computer security is not something that the RIAA is very familiar with, judging by the number of times its own Web site has been hacked.

Blank CDs are used to back-up computer data. When one blank CD costs about the same price as one diskette but stores about 460 times the amount of data, is faster to record and takes far less space than the equivalent thousands of diskettes, it would be stupid not to use CDs for backups. The RIAA was quite adamant that the 10% drop in CD sales in the USA in 2001 as compared to sales in 2000 was purely due to music piracy but this assertion has to be very seriously questioned.

Firstly, if the RIAA is correct, it would follow that the general interest in music was unchanged and that attendances at concerts would be about the same as previous years. They weren't. According to MTV's reports on the web, concert attendances dropped off by about 15% in 2001 and revenues were down. The average ticket price rose by about 7% during the year but as usual it is difficult to say if this deterred ticket buyers or generated the best possible revenue in a bad situation.

An article in the Miami Herald of March 2002 provides a more balanced commentary about the slump in music sales than the RIAA's rants. It attributes a lot of problems in the industry to the fact that the record companies were under attack from many directions - the government was threatening investigations into payola, the companies were suffering the excesses of the technological boom and bust, costs were rising and recording artists were in revolt about the terms and conditions of their contracts with the record companies.

The terms and conditions are normally that artists are contracted to produce a certain number of CDs in a certain time - but it is the companies which dictate what music is acceptable to be marketed and the manner in which a CD will or won't be marketed. For all this, the artists receive 10 to 20 percent of the profits of the sale, but only after the record companies charge them for promotional and marketing costs. Janis Ian has in fact described the situation as being like indentured slavery, and it is therefore no wonder that some artists were very pleased with using Napster to get their music more widely known.

According to the same Miami Herald report, sales of Latin music were up by 9% in 2001 but "In Latin America itself, riddled with economic hardship and rampant piracy, mid-2001 sales fell about 20 percent." At least someone made the connection between personal wealth and piracy.

For a further commentary about issues within the music industry that were contributing to its slump, try this article which also provides a far better analysis of the situation that the RIAA's allegations. This gives an indication of the tone of the piece: "Given the slight dip in CD sales despite so many reasons for there to be a much larger drop, it seems that the effect of downloading, burning, and sharing is one of the few bright lights helping the music industry with their most loyal customers. "

One obvious factor that seems to have been ignored by the RIAA is the nature of the music being released by the record companies. Let me throw some names at you … Sex Pistols, Rolling Stones, Pink Floyd, Rod Stewart, Moody Blues, Brian Ferry, Genesis, Elton John and Cliff Richard. If you are old enough to remember them you will probably like some of them but dislike others. That is not the point; the point is that they co-existed on the music charts in the late 1970s and this kind of variation is a far cry from the kind of music that has been dominating the charts.

The current number of "revivals" or modern versions of old songs suggests that the music from the 60s, 70s and 80s had something that is seriously lacking in modern music. Perhaps the record companies should spend time figuring out just why this is so.

The RIAA's claims that piracy has caused a worldwide slump in music sales are questionable. By virtue of its population size, the figures for the USA distort the total picture. The claims also ignore the fact that US music sells across the world - so if US music is unappealing, sales will be down everywhere.

To refute the RIAA's claims, CD sales in the UK actually increased by 5% in 2001 and in France by a similar amount. (The BBC News report here has the usual comment about piracy but mentions this very important point only as a final comment.) I would not be at all surprised if the influence of US music on the UK and French was somewhat less than for other countries - or that the locally produced music in 2001 was rather more appealing than US music.

To label all US music as unappealing is quite unfair. Latin and Country music sales have been quite good - probably because they offered variety, positive energy and far broader appeal than mainstream pop.

The possible causes of a decline in music sales go further than these reasons.

Potential music consumers today have far more choice in their form of entertainment than just listening to music. They also have other things on which to spend their money and in many cases, they have less money to spend than they did a few years ago.

Computer games continue to improve and they are a big leisure activity. Games cost money that might otherwise be spent on music. Further, games have audio and there is little point playing a CD if the game's audio will drown out the music.

DVD sales continue to be good and the availability of "home cinema" systems with DVD player and high quality audio has made this a popular pastime. Entertainment has become more visual, at least for those with time to sit and enjoy it. Music videos themselves have increased the emphasis on the visual aspect of music.

In the USA the price of movie tickets compared to CDs shows a dramatic difference, with movie tickets reportedly less than half the price of a CD. Recent reports also say that movie attendance figures are very high.

Finally, mobile telephone use is on the increase especially among teenagers who might otherwise buy music CDs. Music might be aimed at this demographic but most of them are still reliant on pocket-money and probably have to pay their own mobile phone charges. Little wonder then that they cannot also afford CDs when some of them rack up bills equivalent to the GDP of a small country.

The RIAA is under threat from a number of directions and it is fighting, on behalf of its members, for continued monopolistic existence. They are under attack from increasing diversions in entertainment and for the would-be music buyers' money. And they are also under attack from a new medium that threatens to drastically change the way that music is distributed and to reduce their control.

They are also seriously concerned about copyright law and fear that as copyrights expire they will lose significant profits and, even more importantly, their control over music distribution.

Since the RIAA started raising a fuss with Napster, the US copyright laws have been changed and the period for which copyright applies has been extended. Depending on your source you will find that this is either the eleventh or fifteenth extension of copyright period in about forty years. One report also indicated that many of these extensions have occurred as various Walt Disney characters were nearing the end of their copyright. (For more details see here).

Those with an interest in extending copyright are more organised and have much deeper pockets than those opposed to change, and so can finance a greater amount of pro-extension lobbying than those who are opposed.

In 1998, an extension to the copyright laws meant that period would last 70 years after the death of the creator, while works owned by corporations were extended to 95 years. The RIAA is pleased with this decision because we would otherwise been nearing the time when certain music from about the early 1950s - the early days of rock and roll - would have moved to the public domain. Anyone would have been free to publish it and equally free to take the profits.

This 1998 extension to copyright period was challenged but in mid-January of this year (2003) the court upheld the earlier ruling and the RIAA and its cohorts were able to relax in the comfort that their various treasure chests would not be released to the public. Don't forget though, when the RIAA was fighting Napster, this outcome was far from certain.

Cynics among us look at the notions behind the copyright law and shake our collective heads. The US law was first introduced in 1790 for a 14-year period with the aim of encouraging creativity and ensure that the artists or thinkers could enjoy the profits of that creativity. Extension of the copyright period is only in the interest of groups like the RIAA because it means they can rely on older material and can minimise any efforts to find new talent.

The battle for copyright is not yet over because European authorities do not kowtow to American interests quite so easily. EU copyright protection lasts only 50 years, as opposed to 95 in the US, and so music recordings from the 1950s are becoming public domain in Europe. The 1950s were a boom in popular music with rock and roll exploding and a big jump in the number of records being released. Elvis Presley's first record appeared in 1956 and Chuck Berry's first just two years later.

US music distribution companies have indicated that they will start to fight CD imports, declaring that the import of European CDs would be an act of piracy and that customs agents have the authority to seize these imports.

Make no mistake, the RIAA is under attack from many different directions, some legislative, some social, some from their artist "slaves" and others from technology. Loss of control of the music business would mean a dramatic loss of profit for these companies and it is for those reasons they are currently embarking on a scare campaign about music piracy around the world.

Again, European authorities are not impressed by this blathering. According to a recent BBC report here, the European Commission has only outlawed commercial (i.e. for profit) piracy but has decided not to criminalise people who download music from the Internet for their own use. Needless to say the RIAA, and its international counterpart the IFPI, are up to their normal tactics and alleging - on no proven basis - that this will cause losses of 4.5 billion euros annually.

In the bigger picture, these organisations are out to police everything on the web that just might be somehow related to the copyrighted works that they jealously guard.

In July 2002 a bill was introduced to the US House of Representatives to permit the owners of material under copyright to hack into any computer that accesses or uses a peer-to-peer file transfer service to see if it was holding any illegal copies of the material. It was described as vigilante justice in the 21st century. I think I know how commercial enterprises such as banks would view such intrusions!

It appears that they need no "due cause" which is what even the various law enforcement agencies require for any similar search activity.

Using similar wild claims about piracy destroying their business, the RIAA and IFPI are embarking on what amounts to a marketing campaign to protect their backsides. Unfortunately the assertions are getting lots of press attention, and there is a danger of the old problem that if a lie is repeated often enough it gets accepted as truth.

In their latest moves the RIAA and other are trying to persuade legal authorities to hold ISPs responsible for any illegal material that is stored on their servers. (For example, see this report). I am not certain if the ISPs will be required to call out the rottweilers (i.e. the RIAA) or to decide if a music file is public domain, copyright but authorised or copyright and illegal, and then act as judge and jury to decide the form of punishment.

As I have argued earlier, the ISPs should not be held responsible because it is not their problem if a user wishes to risk prosecution for whatever crime. I am waiting for the day when ISP operations can be fully automated and there is no need for any middle-person who currently provides a ready and easy target for legal authorities and those who pretend they are legal authorities.

Already the RIAA has managed to convince a US court into demanding that Verizon hand out the personal details of a user who is supposed to have copied music files. I know of no other legal situation where a middle party has been obliged to provide these details to someone who believes that they may have been a victim of some crime.

Fortunately Verizon is already objecting to this demand

This Verizon case was discussed in an Australian article, which went on to blame music piracy for a drop in CD sales (yet again) and make the typical kind of claim that we have already seen from the neo-Luddites. "The finger of blame is pointed at the internet, as industry officials cite a corresponding increase in broadband adoption as proof that increasing numbers of people are stealing music and movies."

The truly sad thing is that the RIAA is not acting in the interests of consumers or even their musical artists. It is only protecting its members, but a lot of influential people are swallowing the story hook, line and sinker.