Alan Greenspan: Failed To Predict Bubble Popping... And Failed In Predicting Home Taping Would Kill Music

from the innovation:-public-enemy-number-1-for-over-a-half-century dept

Even if SOPA passes in its current form, largely intact and full of overreach opportunities, there's no reason to believe this will be the last (or even the most overreaching) legislation crafted at the behest of the content industries.

The -AA's long history of overreaction to various "threats" (read: technological advancements) has been well detailed here at Techdirt. Joe Karaganis opens a recent post at the SSRC (Social Science Research Council) blog with this mystery quote:
Several of these analyses of alleged harm to the recording industry... were presented and debated during hearings on copyright... At each hearing, X presented the results of the most recent analysis done for the recording industry by his firm... [As] in his earlier testimonies, he stated that continued [copying] had grave implications for the viability of the recording industry. Noting that recording-industry releases were down by almost half since ****, and that industry employment had declined... X stated that further growth in [copying] would cause further decline in these industry indicators.
Karaganis asks: "So, who is X and what is the timeframe?"

If it's hard to guess, there's a reason for that. Because of the industries' insistence on turning every new "threat" into a federal case, this could have happened at any time in the last 50 years. Or it could be happening right now. The answer, however, is a bit surprising, considering who is being referenced.
Did you guess: Alan Greenspan in the early 1980s? Bravo.
To say that Greenspan's reputation has taken a bit of hit since stepping down as chairman of the Federal Reserve would be an understatement. To see that he wilfully (perhaps motivated by a donation) pled on the RIAA's and MPAA's behalf does nothing to resurrect his respectability. Karaganis quotes from a recounting of home taping battles, put together by the (now defunct) OTA (Office of Technology Assessment):
By 1986, industry stakeholders...had sponsored almost a dozen surveys and studies, usually to support or oppose passage of home-copying legislation. ... OTA noted:

In the 1985 analysis, sponsored by the RIAA, Greenspan estimated that in 1984, each instance of home taping cost the taper $1.67 per album equivalent, compared with an average retail price of $6.80. On the basis of an earlier report on home taping by the firm Audits & Surveys, Townsend & Greenspan estimated that 42 percent of all home tapings from prerecorded material and 40% of off-the-air (broadcast) tapings would have generated sales, if taping had not been possible. Then, assuming that 40 percent of home taping in 1984 was in lieu of purchases of records or recorded cassettes, the firm estimated 1984 retail losses of some $1.5 billion...

Moreover, as in his earlier testimonies, he stated that continued home taping had grave implications for the viability of the recording industry. Noting that recording-industry releases were down by almost half since 1979, and that industry employment had declined from 29,000 in the late 1970s to less than 19,000 in 1984, Greenspan stated that further growth in home taping would cause further decline in these industry indicators.
This sort of alarmism is very familiar to anyone paying attention. The refusal to recognize the technological advancement as being a possible ally to the industries is shrugged off in favor of panicked statements and questionable numbers. This very refusal to consider the "benefit" side of the argument is called out by the OTA and other industry groups:
Greenspan's two earlier studies had estimated losses...amounting to $1.05 billion for 1981 and $1.4 billion in 1982. The Consumer Electronics Group of the Electronics Industries Association (EIA), the Audio Recording Rights Coalition, and the Home Recording Rights Coalition (HRRC) submitted dissenting comments and testimony disputing these estimates. ... EIA claimed that the analysis for RIAA had ignored the stimulative effects of home taping on sales of recordings, and that some home tapes (e.g. selection tapes made for portable or car tape players) are not substitutes for prerecorded products... A pattern emerges in these debates. The published recording industry arguments and economic analyses deal only with estimates of alleged harms...
Much like the past decade, the RIAA and MPAA have spent an immense amount of time, energy and money attempting to place the blame for their economic downturn solely in the hands of infringers, completely ignoring other surrounding economic factors or the drastic changes in consumer habits. This selective blindness is nothing new:
[I]t's worth noting that Greenspan spent several years trying to pass stronger enforcement laws based on a scare story about a temporary dip in the market, as the cassette displaced the 8-Track and vinyl went into decline (and the US suffered a major recession). Stronger enforcement was a solution to maintaining the revenue levels associated with the LP and 8-Track. And he made this case at the beginning of the greatest boom period in the recorded music industry: the CD era. Now that the CD is dying, our present-day Greenspans are doing the same.
Everything continues to change but the arguments remain the same. The fact that Alan Greenspan delivered these remarks is somewhat surprising considering his later stance on IP issues. In a 2004 speech at the Stanford Institute for Economic Policy Research Economic Summit, Greenspan had this to say, seemingly forgetting his earlier efforts on the home taping battlefront:
"If our objective is to maximize economic growth, are we striking the right balance in our protection of intellectual property rights? Are the protections sufficiently broad to encourage innovation but not so broad as to shut down follow-on innovation? Are such protections so vague that they produce uncertainties that raise risk premiums and the cost of capital? How appropriate is our current system--developed for a world in which physical assets predominated--for an economy in which value increasingly is embodied in ideas rather than tangible capital?"
Greenspan is mostly referring to patents here, but a lot of what he says holds true across the rest of the intellectual property spectrum. There is a good possibility that Greenspan learned something from his earlier experience, recognizing the fact that technological progression tends to displace legacy industries, but it just as often creates new opportunities, provided it is not stifled by antagonistic legislation designed by the legacy industries in order to protect the status quo.

And about that status quo? Whose status quo is really being protected?
As the MP3 replaced the CD, the major labels cut their distribution costs, struggled to keep digital prices at rough parity with the CD, and pocketed the difference. An artist signed with a major label still makes 15-20% on wholesale-no more than for a good deal in the CD era. Many of the indie labels and digital aggregator services, in contrast, return 50-90% of the wholesale price to the artist. It is glaringly obvious that the major labels' 80% wholesale cut isn't sustainable-nor, I will predict, is Apple's 30% retail cut. Piracy was the messenger, not the message.
Costs have decreased across the board, but artists are still getting the short end of the stick. This isn't about them. It's about the labels, studios and their executives. Despite their constant complaints about how much sales have decreased, executive salaries have never been subject to the same downturn. Karaganis quotes The Lefsetz Letter:
Used to be running a label paid well, but it was mostly about the music, the lifestyle. Then, with the advent of MTV and the CD, suddenly Tommy Mottola was far richer than the acts. And Tommy and his ilk started hanging with other rich people in the Hamptons, they felt entitled to their wealth. Such that when Napster blew a hole in the paradigm, everybody was sacrificed but the top guy. The people running the labels are still as well paid as they were before Napster, before the recession. They're keeping up with the joneses, they're in charge, everybody's expendable but them. As for those people still working at the label...they're thrilled to have a job. Glad to be slaves on the plantation.
The arguments are old and repetitive and the rhetoric has expanded past "think of the poor artists" to "protecting jobs" to the outer reaches of credibility, conjuring up victims such as the US military and firemen. And that's because it's not really about protecting artists. It's about protecting industries which have become used to a certain "standard of living" and now the general public can't be as easily duped about sales numbers and executive salaries, all sorts of emotional buttons are being pushed in a very haphazard and desperate manner.

If it's any consolation, there will be more on the way. I highly suspect there will be never be a legislative solution to the problems of the content industries solely because much of the problem lies with the industries themselves.

(H/T - Ulysses)


Reader Comments (rss)

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  1.  
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    chrisbyrnes (profile), Dec 16th, 2011 @ 8:27pm

    OTA and Newt

    As a person that volunteered with OTA on one IP related project, I would like to acknowledge that OTA was the most independent and transparent government agency I have ever been exposed to (and there are many at federal and state levels) which led to their being targeted and destroyed by Newt Gingrich. If anything describes his approach to government, it is this. Beware.

     

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    Atkray (profile), Dec 16th, 2011 @ 8:48pm

    I should not have read this.

    I shall now go be sick.

     

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    A Guy (profile), Dec 16th, 2011 @ 8:49pm

    Hey, I got the housing bubble thing better than Greenspan. To be fair though, everyone I spoke to about it thought I was nuts until just before it happened.

    In the long run, it doesn't matter if SOPA is passed to the recording industry. The artists have a direct link to their fans. Fans have cheap rewritable mediums to store their stuff on. The economics have already turned against their model. The rest of it is just watching them adapt or die.

    If SOPA is their strategy, the answer will be die. SOPA does nothing to make artists less able to self publish or connect to fans independently. It will only alienate their customer base and make the internet less stable/secure for the rest of us.

     

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    Jay (profile), Dec 16th, 2011 @ 9:18pm

    Re:

    Pfft. Greenspan got the benefit of obfuscating stupidity. You want to know what he did? He basically kept the interest rate low to induce more borrowing, place people into debt, and make a killing on the interest. Amazing how people treated him like a rock start for helping to ruin the economy.

     

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    Violated (profile), Dec 16th, 2011 @ 9:20pm

    The Monster

    Well of course they have always been scaremongers and huge liars. This is a monopoly and the monopoly protects itself while always trying to control other markets.

    Let me share a revelation with you... The MPAA and RIAA love piracy when it is thanks to piracy they have the perfect excuse to seize greater control over the markets with laws like DMCA, SOPA and PIPA.

    They are of course not best friends with the smelly beast next door but clearly from the MPAA's annual figures they can live quite comfortably with piracy. I doubt too many other businesses can claim expansion during the recession.

    This goes a long way to explain why ICE has never touched any of the Top 10 piracy sites around. Hell I doubt they have even touched any of the Top 100. So when ICE seize a domain, to look like they are actually doing something, then this is only some minor site most have never heard of. Is this really going to stamp out piracy any? No...

    The truth of the matter is reflected in the RIAA's figures when this is really a dinosaur facing extinction. They may well die because they have lost their monopoly and a free market now exists. Indie artists have no need for the RIAA when they can do it all themselves.

    Here is something to scare you. The real target for SOPA/PIPA are the Indie artists. The RIAA fighting piracy benefits them little but to fight rival business in terms of non-RIAA channels will begin to force artists and sites back under the RIAA umbrella so they can take their 80% cut!

    This goes to well explain Dajaz1 when this legal and free music promotion of new and unknown hip-hop and rap artists was a distribution point where the RIAA was not getting their usual 80% cut.

    So only once they have seized control over large parts of the Internet will they start to seriously tackle piracy along with a lot of collateral damage. It is not hard for the MPAA/RIAA to flood a site with media they term "infringing", take the site off-line, and then impose their own control and market as part of the owner having the site restored.

    Now you know what they will soon vote on. Yes they love piracy the best SOPA excuse ever.

     

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    A Guy (profile), Dec 16th, 2011 @ 9:36pm

    Re: Re:

    To be fair, that is how most western democracies ran their government finances too. It wasn't all his fault. Our various legislators had a giant hand in it. Private industry did its very best to make bad investments in finances, labor, and "securities."

    This economy is such a giant cluster fuck that it took the collective idiocy of millions of people working against themselves and hoping they would cash out before the bill came due to make it happen.

     

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    TtfnJohn (profile), Dec 16th, 2011 @ 9:36pm

    Of course, this isn't about copyright, it isn't about the artist, about full or part time or casual jobs. As the commentary says it's about outlandish CEO salaries that seem based not on corporate performance but on, well, who knows.

    There's nothing too much in either article linked to in the story I'd disagree with. Maybe a nit pick here and there. Not much more.

    The late 90s and the past decade of this century have done more to cement mediocrity in music than anything else I can think of.

    Home taping was gonna kill the record industry. It didn't.

    High resolution video cameras whose output is almost indistinguishable from the best film based cameras there is was a massive threat to the motion picture industry not all that long ago but they use them now. Film is dead and buried.

    The threat is still there that some indie place can come along and make a fantastic movie but it's not gonna happen as long as Hollywood controls the supply line to movie houses. Or rarely happen.

    On the music side all the RIAA wants or needs now is a couple of genetically modified kids who look sexy, preferably one of each gender who can sorta dance. Singing doesn't matter as there's autotune for both recording and concert work, when the stars aren't lip synching.

    Of course the back catalogue is valuable, extremely valuable so their upset about what they call piracy and the MPAA will jump on board because fewer people are going to movies so that must be from piracy too.

    Now, if they could get rid of piracy, file sharing and evil stuff like that they can seize control of the distribution channels again and the CEOs can continue to make bazillions while not paying or nurturing new musicians, or risky bands or, well, MUSIC, as opposed to the sort of thing that would work well for Muzak in an elevator. Or movies remaking bad tv shows or even older bad movies and wondering why no one goes.

    In the meantime it's the "pirates" and evil file sharers who fuel and break new indie acts and indie or foreign films, the few that actually get into theatres like The Ring.

    If you can turn something into a copyright issue and frame it as "what about the starving artists" and "who cares about the starving artists" and actually get away with it you got a good gig there. Particularly as the MPAA and RIAA don't care one whit about them.

    But we need laws to ensure that copyright is respected so that that bunch can salt away 8 and 9 figure incomes in perpetuity.

    Oh, and get rid of all those pirates and freeloaders while we do it. Except you don't.

    That's the fatal flaw here.

    Screwing around with American DNS so that results for known "pirate" sites won't know on a search engine results list wont do it when no other country in the world is doing it. All cutting off the money supply to them does is piss other countries off as legit sites get tagged as "pirate" and the payment processors get caught in the middle between the US and other countries insisting they obey their laws and pay them while other processors spring up globally to get around that.

    All this in aide of a false presumption that has more to do with not giving customers what they want at a price they want rather than visions of high seas piracy for profit.

    And all for two free spending industries who contribute little to the GDP of the United States or to employment. All while the tech industry, an IP intensive industry if there ever was one, opposes these moves and contributes vastly more in both contribution to GDP and employment than the Hollywood gnomes ever will. Not to mention valuable exports.

    Ahhh to live in la la land. Ahh to head up Hollywood companies or banks. Got a problem, go to government, they'll write you a cheque cause you're too big to fail or put you on life support and welfare cause you contribute almost their entire campaign funding.

    All while howling about the lazy bums on real welfare who can't feed their families cause their out of work and about top lose their homes through, mostly, no fault of their own.

    Someone's priorities are all screwed up here.

     

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    Ed C., Dec 16th, 2011 @ 9:56pm

    Re: The Monster

    Here is something to scare you. The real target for SOPA/PIPA are the Indie artists. The RIAA fighting piracy benefits them little but to fight rival business in terms of non-RIAA channels will begin to force artists and sites back under the RIAA umbrella so they can take their 80% cut!

    Indeed! The more people know the truth, the better.

     

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    Anonymous Coward, Dec 16th, 2011 @ 10:10pm

    Re:

    Yes it does, it has no effects on piracy that is resilient and have its own means to deal with the situation, the problem lies in the commerce, SOPA is a direct threat to online commerce, since you can go and erase online stores from existence without any consequence for doing so.

     

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    Anonymous Coward, Dec 17th, 2011 @ 1:44am

    Re: The Monster

    You see when they start to control this layer I am moving to the next one and I know the bums will fallow because they want the money in my pocket which I don't want to part with for them, and so we keep going round and round.

     

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    A bar of SOPA, Dec 17th, 2011 @ 1:57am

    SOPA or Die?

    If SOPA is their strategy, the answer will be die. SOPA does nothing to make artists less able to self publish or connect to fans independently.

    SOPA allows the gatekeepers to the media to unilaterally define who is infringing, which may include independent artists releasing their own material.

     

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    Violated (profile), Dec 17th, 2011 @ 3:44am

    Other Paths

    An alternative idea to SOPA/PIPA has been proposed.

    This idea is to turn the control of online piracy over to the International Trade Commission. Doing this would remove any one country or market trying to seize control of the Internet for their own profit objectives.

    I expect we can welcome that idea. Those behind SOPA/PIPA wont be happy including the millions of dollars Hollywood invested.

     

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    Anonymous Coward, Dec 17th, 2011 @ 4:57am

    Actually, it would appear that Greenspan got it right, but that it took a little longer and one more level of technical advancement for it to come true. He could see the effects of "home taping", and no matter how bad they were, the current situation is X numbers of times worse and more widespread.

    Seems like he got it right more than he got it wrong.

     

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    The eejit (profile), Dec 17th, 2011 @ 5:09am

    Re:

    One more level? You're out of your fucking gourd: there were at least three layers separating the cureent from cassettes.

    And as for home taping killing music, increasing revenues across the board give the lie to that: Greenspan was obviously predicting the inevitable end for the RIAA-represented labels.

     

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    gorehound (profile), Dec 17th, 2011 @ 5:18am

    Re:

    +1
    very true since I am an Artist.Playing a gig tonight at Genos in Portland, Maine with my old friends "Psycho" from Boston where I am originally from (Lynn,Mass).
    SOPA/PIPA will shut down TPB and other places where I legitimately am sharing 6 LP's of my Art I own and put out.
    I am not the only DIY Artist who would never sell out to a Big Label & RIAA.I have been playing around with rock music since I was 16 in 1972 !!!
    Big Meat Hammer is my oldest punk act since 1989 and the oldest in Maine.
    Also of course the Net will be a lot more open to the world of virtual crime.

     

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    Jeff, Dec 17th, 2011 @ 5:32am

    They went after the wrong industry in the 80's I remember dubbing tapes from albums to listen in the car. Because GM never put out an LP deck I was forced or induced to dub all my albums onto cassette tapes. Which sometimes had me scratching my head which songs to include because the tape couldn't hold the entire album. And at that time several artists put out albums where all the songs were good.

     

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    Anonymous Coward, Dec 17th, 2011 @ 5:39am

    Testing the waters of economic liberty

     

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    vancedecker (profile), Dec 17th, 2011 @ 6:18am

    "Check Your Premises" -Ayn Rand

    Will this stop Libertarian Christian nut bags from quoting an avowed atheist as Free Market scripture?*

    In the same sense, all the Limbaugh-Beck drone units are now telling us that the bank bailouts were not capitalism. So in effect, according to Rand, who died for our capitalist sins, we are absolved from the sin of TARP, which was caused by a sodomite Senator anyway. I mean nobody is perfect right?

    So long and thanks for the worthless apology...without any punishment to deter them, the doctrine of Industry Self Regulation will mean many more TARPs and too-big-to-fails to come.

    (*Greenspan was at one point an Ayn Rand disciple...for all you home skoolers out there)


    Anyway, the point is, after the complete failure of "self regulation" and freeing market forces for the magical invisible hand, we got the world's largest financial crisis to date. Will Objectivists, Libertarians, and Bible Thumpers check theirs?

     

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    Anonymous Coward, Dec 17th, 2011 @ 7:37am

    Re: "Check Your Premises" -Ayn Rand

    What self regulation?

    There is no self regulation in a market that rewards the big at the expense of the small, all those tools that congress gave to corporations just make it harder and harder for anyone to enter the market, the internet self regulates and have no rules except the ones that everybody must fallow.

    Open source projects self regulate and they have no rules, only rules excluding rules.

    See the pattern there?

    Self regulation works, but it doesn't work when you put rules that benefit only the big players and not the smaller ones, when you put rules that exclude the smaller ones there is no self regulation because there is no competition for the resources.

     

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  20.  
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    Anonymous Coward, Dec 17th, 2011 @ 7:42am

    Re:

    Truly I wish he was right, because that would mean pain for the industry and all those people who believe monopolies are a good thing.

     

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  21.  
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    Anonymous Coward, Dec 17th, 2011 @ 8:08am

    Re: Re:

    Really, one level: Connected computers. Forget the baby steps and interim moves like CDs and all that, it still didn't change things until we got computers connected, with enough people actually using them. The result was Napster.

    Greenspan just missed it by a generation of technology, but he saw the end result from very far back.

     

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    ken (profile), Dec 17th, 2011 @ 8:22am

    John Philip Sousa Said Recording will Kill Music

    From the nothing changes department...

    "These talking machines are going to ruin the artistic development of music in this country. When I was a boy...in front of every house in the summer evenings, you would find young people together singing the songs of the day or old songs. Today you hear these infernal machines going night and day. We will not have a vocal cord left. The vocal cord will be eliminated by a process of evolution, as was the tail of man when he came from the ape." ~John Philip Sousa

     

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  23.  
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    Anonymous Coward, Dec 17th, 2011 @ 9:05am

    Re: Re: Re:

    Well, Napster and connected computers have destroyed recorded media.

    I guess that explains why video games don't exist anymore. Stupid connected computers, destroying recorded media.

     

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    Rikuo (profile), Dec 17th, 2011 @ 9:38am

    Re: John Philip Sousa Said Recording will Kill Music

    And if Sousa had been around today, he'd find that people aren't allowed to sing the songs of the day or old songs, at least not without paying some collection agency first.

     

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  25.  
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    Anonymous Coward, Dec 17th, 2011 @ 9:42am

    Re: Re: Re: Re:

    Oh look, another pirate apologist.

    Take a bow, lowlife.

     

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  26.  
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    jupiterkansas (profile), Dec 17th, 2011 @ 10:10am

    Re:

    I remember the days when every song was good. That was nice.

     

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  27.  
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    Pirate Apologist, Dec 17th, 2011 @ 10:52am

    Re: Re: Re: Re: Re:

    "Oh look, another pirate apologist."
    I keep seeing this pirate apologist phrase pop up from time to time, and I just wondered what it really meant?

    it seems the most logical explanation would be:
    pirate apologist: "I am sorry Mr *AA man that you failed to adapt your business model to a changing world, better luck next time."

    and that is just an variation of an evolution apologist...
    ie evolution apologist: "Sorry Mr Dodo that you failed to adapt to a changing world, better luck next time"

    hmm... I think I actually like pirate apologist, seems fitting and proper... I think I will use that as my name hence forth...

     

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  28.  
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    Richard (profile), Dec 17th, 2011 @ 11:36am

    Re: Re: Re: Re: Re:

    Oh look, another pirate apologist.


    Look another messenger

    We don't like the message - so let's just shoot him!

     

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  29.  
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    ken (profile), Dec 17th, 2011 @ 11:46am

    Copyright in its purist form there can be no culture because itself is reduced to nothing more than individual business transactions.

     

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    ken (profile), Dec 17th, 2011 @ 11:47am

    Copyright in its purist form there can be no culture because art itself is reduced to nothing more than individual business transactions

     

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    JackHerer (profile), Dec 17th, 2011 @ 12:08pm

    The headline is confusing

    It implies that he failed to predict that the bubble burst in the same way he failed to predict that home taping did in fact kill music. Surely it should read ".... And Failed In Predicting Home Taping Wouldn't Kill Music", in that he predicted that it would?

     

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  32.  
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    Anonymous Coward, Dec 17th, 2011 @ 1:08pm

    Re: Re: Re: Re: Re:

    Is it my fault that content "creators" are too stupid to use the internet to their advantage?

     

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  33.  
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    Anonymous Coward, Dec 17th, 2011 @ 1:10pm

    Re: Re: Re: Re: Re: Re:

    Sorry, I meant to say some content "creators". Although it seems that some actual content creators can use the internet to their advantage, like the Humble Indie Bundle people, or Louis CK.

     

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  34.  
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    Anonymous Coward, Dec 17th, 2011 @ 1:14pm

    Re:

    "In the long run, it doesn't matter if SOPA is passed to the recording industry. The artists have a direct link to their fans. Fans have cheap rewritable mediums to store their stuff on. The economics have already turned against their model. The rest of it is just watching them adapt or die."

    The issue is that you mistake technology for a business model, real or failed. It isn't about your recordable mediums or your direct fan connection. We have had both of those for a decade or more. It hasn't been turning out anything major, because it still ignores one of the very basic human instincts:

    We want to be like our friends.

    Our choices of music, of movies, of likes and dislikes... those are all formed by our social groups (family, friends,e tc). We like to dress like the stars, but we like to have that look recognized. All the direct fan connection doesn't work if it doesn't also create the social trends around it. We want our friends to know our association based on what it is that we wear, say, how we act, etc.

    So all the direct medium connectivity doesn't change anything unless it also pokes into the social strata, and for the moment, that still isn't happening.

    It's nice to have internet friends that know what it is we like, but when you are walking down the street and your look doesn't register with anyone, we have failed socially in our AFK lives.

    The reasons the labels, radio, TV, and all that other stuff still works and still does as well as it does faced with this overwhelming technology is the social aspects. It is unlikely to chance any time soon.

     

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    wvhillbilly (profile), Dec 17th, 2011 @ 1:28pm

    Re:

    "...it's about outlandish CEO salaries that seem based not on corporate performance but on, well, who knows."

    Who knows? It's greed, pure and simple.

    Greed is an insatiable monster that is not, never has been and cannot ever be satisfied. The more a person infected with greed gets, the more he wants, the more he wants the more he gets, and it just goes around and around with no end.

    Starving artists? That's nothing but a red herring thrown out to divert attention from the real issue. If artists are starving, it's because the RIAA/MPAA is throwing them crumbs and refuses to give them their fair share. They want it all for themselves, and giving artists their fair share means less for the fat cat executives.

    The entertainment industry has fought tooth and nail against every new technology that has come out, from the cylinder phonograph onward. Then when they accepted it they found it to be quite to their benefit.

    And grossly inflated loss figures are nothing new either. They use all sorts of fuzzy math and invalid assumptions to arrive at these figures, and I doubt they are fooling anybody but the politicians whose hands they grease. They ignore all the possible beneficial effects of "piracy" such as exposure, and assume that in every instance someone downloaded a song they would have sold an album if they hadn't and ignore the fact that some who have downloaded do go out and buy the album if they like what they hear.

    As for downloading and file sharing, I'm sure the vast majority of people who do that would gladly pay a few dollars a month to do so legally, if only the RIAA/MPAA would provide a way for them to do so. And they could probably bring in $billions a year doing it.

    But would they share that equitably with the artists? I doubt it. They'd rather cling to their outmoded steam-engine business model and scream about how much piracy is hurting them, until they get copyright so restrictive that even normal use is infringing, their steam engine business model blows up and all their would-be customers find ways to get around the restrictions and leave the labels sitting in the dust. They have nobody but themselves to blame when they refuse to adapt to the times.

     

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  36.  
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    The eejit (profile), Dec 17th, 2011 @ 3:02pm

    Re: Re: Re:

    uhhh, CDs were around since the late 1970s. So you're still out of your fucking gourd.

    The second step was WMP, which allowed you to rip CDs onto your computer.

    And the final step was connecting to the Internet.

     

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  37.  
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    Jay (profile), Dec 17th, 2011 @ 3:40pm

    Re: Re: Re: Re: Re: Re: Re:

    Is it my fault that content "creators" are too stupid to use the internet to their advantage?

    Oh they use it to their advantage just fine

     

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  38.  
    identicon
    Anonymous Coward, Dec 17th, 2011 @ 4:53pm

    Re: Re: Re: Re: Re: Re: Re: Re:

    Yeah, but think about how much more money they could be making if they had the ability to censor the internet!

     

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  39.  
    icon
    wvhillbilly (profile), Dec 17th, 2011 @ 4:53pm

    Re: Re: Re: Re:

    "Stupid connected computers, destroying recorded media."

    OK.how about this? "Stupid CDs, destroying vinyl LPs and 78RPM media."? Or, "Stupid 78 RPM records, destroying cylinder records." No, they just replaced old, obsolete recording technology with something better.

    If the RIAA/MPAA would learn to adapt to the times and current technology instead of trying to lock everything down airtight so they can continue with their obsolete steam engine business model in the electric/electronic age and tell the truth instead of presenting vastly inflated claims of losses, maybe they wouldn't have all these problems with "piracy". And suing your customers/potential customers for $millions for downloading a few songs doesn't exactly make for good business relations either.

    Go figure.

     

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  40.  
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    wvhillbilly (profile), Dec 17th, 2011 @ 5:01pm

    Re: "Check Your Premises" -Ayn Rand

    Uhhh...I think you're a bit off topic.

     

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  41.  
    identicon
    Marsili.us, Dec 17th, 2011 @ 5:15pm

    This post must be so confusing for readers new to SOPA

    We were considering sharing a link on our personal Facebook page, to a search results page for SOPA here at TechDirt. However, if we do so, the first thing anyone will see when following the link will be this post, whose author has made a confusing issue even more confusing with a complex digression. Despite our interest in political things, even we are trying to gain a passing familiarity with this problematic legislation and the even more problematic way it is being crafted. The writer's throwing up a headline about the bubble in mortgage credit and diverting readers' attention with a guessing game about little-known statements made by Alan Greenspan a quarter century ago have not helped clarify matters.

     

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  42.  
    identicon
    Graham Storrs, Dec 17th, 2011 @ 6:02pm

    Guess what's going on in th ebook industry

    Correct, exactly the same thing. Here the threat is ebooks and piracy but the response is exactly the same from the big publishers. They're not so well organised (yet) as the MPAA and the RIAA but their tactics (prosecute, lobby for legislation, and keep ebook prices as high as print) are just the same.

    Why does no-one ever learn?

     

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  43.  
    identicon
    DoN0tReply, Dec 17th, 2011 @ 8:55pm

    Re: Re: Re: Re: Re:

    I disagree that CDs are technologically superior to Vinyl, due not only to the limitations of a Redbook (44.4kHz, 16 Bit) Audio CD (you don't need the ears of a bat to tell the difference fyi, though my ears are in excellent condition) but the lack of proper mastering of CDs these days (look up 'loudness war' on youtube for a few examples - this one of Dire Straits Money For Nothing makes a good starting point http://www.youtube.com/watch?v=7UjQc0dM4H4 ).

    It's not just a matter of having the best tech available (1:1 studio masters would be sublime but good luck getting one of those) but also being able to actually use it properly (I am quite capable of adjusting the volume of my music myself TYVM MAFIAA and subsidiaries).

     

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  44.  
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    MusicBoy33 (profile), Dec 18th, 2011 @ 2:09pm

    Clueless Posters

    This just in...paranoid posters on the loose.

    For your information, executives in the music industry don't give a shit about indie music and whether it's available for free. They are not seeking to keep out competition whatsoever.

    They are only interested in keeping their music from being stolen which infringes on their copyrights and their profitability.

    A bunch of loons post here.

     

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  45.  
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    Ben Carruth (profile), Dec 18th, 2011 @ 2:21pm

    Preaching to the choir

    A technology intended to rapidly distribute information in as decentralized a fashion as possible (for robustness, resilience, etc) is being used to rapidly distribute information in as decentralized a fashion as possible, and somehow, people are surprised.

    One of the aspects I find most amusing about all of this is how deeply people have internalized relatively recent (i.e. latter 20th century) concepts of intellectual property, as if they'd been there all along. The moment it was possible to print a million reasonable facsimiles of a painting, intellectual property changed. The moment a musician could be recorded (most of 20th century copyright law pertains to the distribution of sheet music), it changed again. When working as a musician required access to a multimillion dollar studio, it changed yet again...

    ... and the moment a musician could produce an album of the same quality, with similar distribution access, all by themselves without being beholden to an antiquated corporate behemoth, it changes yet again.

    "Copying" is right at the heart of the issue. The point in contention, the winch twisting the nickers of the RIAA and their ilk, is not that copying is being done, and certainly not whether or not copying negatively impacts an artist. There's a line from "cotton patch gospel" that sticks out in my mind: "There is no doubt that these so-called 'healings' are the result of an alliance with a negative supernatural force. Otherwise, why would he do it for free?".

    When Warner Music Group does it, it's production. When you do it, it's theft, according to laws written at a time when a "recording" was a physical apparatus beyond the ability of the consumer to produce. Digital transfer is, legally, stealing in an impossible way. It's akin to plagiarism via telepathically siphoning the thoughts from an authors mind before they write them down....

    ... which kinda brings us to the nub, that copyright law was, and is, primarily intended to protect creator credit and identity. The lobby push against digital distribution is as much about keeping the artists in line as it is protecting grossly inflated profit margins. If uncontrolled distribution channels are legitimized, i.e. when sharing is regarded as every bit as legit as buying a CD at Walmart, WMG and company lose their last hold over the artist.

    Yeah, think of the poor artists. Download their album and use the money you saved to buy a t-shirt at their next gig.

    heh. Sorry for the ramble ;-)

     

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  46.  
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    A Guy (profile), Dec 18th, 2011 @ 5:38pm

    Re: Re:

    Thinking like that is the difference between a developer and a user, or a entrepreneur and a customer.

    Change will come either way.

     

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  47.  
    identicon
    Sustainable Living, Dec 18th, 2011 @ 5:53pm

    He did recognize...

    After he left off, Greenspan did acknowledge he should have seen it and considered it a mistake on his part. Not defending him, just interesting to see him admit it.

     

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  48.  
    identicon
    Anonymous Coward, Dec 18th, 2011 @ 6:48pm

    Re: Re: "Check Your Premises" -Ayn Rand

    I think you're having what is known as an O.B.E.

    Please let me know when you're shrooms have worn off and are ready to discuss the reality of what actually occurs, small business, big business, self regulation, for the most part, at the regulations designed to protect consumers and the environment does not work.

     

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  49.  
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    PaulT (profile), Dec 19th, 2011 @ 12:50am

    Re:

    "Seems like he got it right more than he got it wrong."

    No, he's still wrong. It's just that in the late 70s/early 80s, the industry actually conceded and started to offer the public what they wanted. RIAA members offered CDs, and 3rd parties were allowed to offer walkmans and other portable equipment that made the music more useful. MPAA members stopped being morons fighting against home video and offered titles for rental, then to purchase, creating a lucrative secondary market. And so on...

    Right now, the problem is that these organisations are once again on the wrong side of history, trying to fight against customer demand instead of supplying it. The solution is the same as ever - alter business models to allow customers to get what they want legally. They will continue to fail until they do this. If they get it right, in another 30 years something else will change they have to adapt to. Such is the nature of the business.

     

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  50.  
    identicon
    Jes Lookin, Dec 19th, 2011 @ 8:43am

    It is probably a POV thing

    I read his book and was suprised at the level of disconnect between Greenspan and reality. I'm used to seeing that in medical practice (mostly psychiatric), since they have a uber-geek/respect-assumed background. Greenspan has that in a whole new, bizzare world of the rich and political. It's a bit frightening that people like that can influence your life - they have no idea what it's like to need employment, money, or security.

     

    reply to this | link to this | view in thread ]


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