Cary Sherman, RIAA boss, is testifying before Congress on Wednesday morning, and (not surprisingly) he uses the opportunity to whine about those dirty pirates again, while asking Congress to buck up and do something. To his credit, it appears that Sherman (or one of his PR handlers) has realized that the combative and confrontational approach he took right after
SOPA and PIPA died. He got a ton of backlash for that, and has since tried to be a little less condescending.
Thus, he starts out by talking about all the new business models and modern services that the record labels have adopted and licensed. Of course, he also says that CDs are not digital, so he's a bit confused about the technology. He also leaves out the fact that the labels had to be dragged, kicking and screaming, all the way to agree to the various services that he talks up -- and even then, its stance in negotiating licensing deals with them has been to try to strangle any service that gets too popular. He also talks up the recently negotiated royalty rates
between labels, publishers and some digital music services -- leaving out the fact that they include royalty rates on things that don't require royalties
(like mere music storage lockers).
But, in the end, Sherman is a one-trick pony, and back to that trick he goes. After talking about all of this "voluntary" innovation they've done -- and highlighting the various "voluntary" six strikes deal, as well as advertising putting together a blacklist of "rogue" sites they won't advertise on -- Sherman goes back to whining about how "piracy" must be stopped. He starts out by, yet again, misleading and misrepresenting what's happening. He talks about how there's less revenue from music sales -- but ignores that more money
has gone into music itself, once you look at the massive increase in live music. He ignores the fact that people are actually spending more
on enjoying music today than ever before in the past. The idea that people aren't paying is simply wrong.
And then he has the ridiculous gall to suggest less music is getting out to the world because of this:
What kind of harm? Massive layoffs, of course. But also less
money to invest in artists. That means fewer artists on our rosters, fewer people who can make
a living from music, fewer songs permeating through our culture that help form a piece of our
That's ridiculous. Look at any credible data, and you see that more
music is being created today than ever before. More artists are making money today from music than ever before. And you know how
songs can better permeate through our culture and help form a piece of our national identity? Well, here's a hint: by not locking up that music, by allowing it to be shared and played and heard. But that's not how the RIAA works.
He brings up the record labels favorite talking point these days: which is that fewer people list themselves as full time musicians in the Bureau of Labor Statistics data. This is, at best, a red herring. This is a time of transition, and certainly the labels are funding fewer musicians. But new business models are growing rapidly and while they may not be funding as many full time musicians (yet), they are
musicians make some
money. And, as we've seen over and over again, the trend on these new platforms is that they're growing
and able to fund more and more, as they grow. It's a classic innovator's dilemma situation. Similarly, the deeper you dig into the BLS numbers, the more interesting things you find. For example, there's been a massive increase
in independent artists. But, the big labels that the RIAA represents don't want you to know that.
He then goes on to claim that enforcement works -- and uses Limewire and MegaUpload as examples. He notes the correlation between growth in sales after Limewire's shut down, and suggests "it is not a coincidence" the two things happened at the same time (though, other reports note the release of some very popular albums at the same time). He also insists that a survey of Limewire users claims they didn't sign up for any other unauthorized service. That's something more like wishful thinking. The data actually suggests there continues to be a pretty big growth in unauthorized sharing. The death of Limewire looks like a temporary blip. Also, if you were a former Limewire user, and a research firm representing the guys who shut it down came and asked you what you were using now, how many of you would point your finger to the new service you found so they could shut it down? Exactly.
As for Megaupload, nice work by the RIAA to support a case that is rapidly falling apart for the US, where it looks increasingly like the US didn't even come close to following the law
in shutting down a site that had significant non-infringing uses. And, of course, he leaves out the fact that it was the RIAA's own bogus evidence, which they could never back up, that resulted in a hip hop blog, Dajaz1, being shut down and censored for over a year. That's the kind of enforcement he's supporting?
And then there's the push for a new SOPA:
These voluntary programs are not a panacea. No program ever will be. And sometimes,
the Congress must step in to assure that our property rights, and U.S. economic interests, are
being protected. Especially against sites overseas whose business model is the theft of U.S.
Funny that he says this right after talking about the success in shutting down Megaupload -- which didn't (according to the RIAA or the feds) require any new action from Congress.
He also continues to take shots at the tech industry, and at search in particular. After talking about things like the six strikes program and the ad blacklist, he notes:
other intermediaries like search engines will follow suit in negotiating voluntary marketplace
best practices to prevent directing users to sites that are dedicated to violating property rights.
Of course, this ignores the realities
of the situation, in which you can't just block out sites because the RIAA doesn't like them. The RIAA has a long and detailed history of blaming perfectly legitimate products for being "illegal." Remember, this is the same group that sued to kill the first MP3 player. And now they want the search engines to just trust them in determining which sites are evil and which are good? It doesn't work that way.
He then points out that he wants to "reach out" to "the tech and Internet communities." He could just say, you know, "the public." Also, I'm trying to figure out why Sherman, Dodd and others keep talking
about reaching out, but never actually do. Once again, it's not at all difficult to get into a discussion online. Why don't they ever do it?
Sherman also uses the opportunity to once again push for a RIAA bailout from radio, by forcing a tax to advertise their music. The RIAA has been pushing for this tax for years and it makes no sense
. The labels know
that radio is free advertising for them. It's why they're so often accused of payola. Because they know that if they get their songs on the radio, there's massive value in that and lots of ways to monetize it. So they pay ridiculous sums of money to "promoters" who pass that along to radio people to get the songs on the air. And now they're claiming that the labels need to be paid if the radios play that same music? It's insanity.
Either way, it's still more of the same. Until Cary Sherman is replaced by someone who actually spends time on the internet, the RIAA is going to increasingly represent a smaller and smaller portion of the music industry. The new music industry -- including tons of new artists, new music services, and even new labels, know that the RIAA's focus is on the past, not the future.