Techdirt. Stories filed under "downloads"

Australian Recording Industry Continues To Fight The Technology That Is Saving It

Glyn Moody — Fri, 8 Mar 2013 07:19:46 PST

There have been many posts on Techdirt about the copyright industry's hatred for new technologies that eventually turned out to be important sources of additional revenue -- the VCR being perhaps the most famous example. Here's a splendid column from Adam Turner in the Sydney Morning Herald about the same thing happening again in Australia.

As he points out, last year Australia saw a 4% growth in music sales, which outpaced the rest of the world, whose much lower 0.3% growth we discussed recently. In other words, if anything, the Australian recording companies should be celebrating the present and optimistic about the future. Instead, they are once more frightened by some technological developments that will in fact help them: an upgrade to the country's Internet infrastructure. Here's how Turner puts it: As the National Broadband Network [NBN] rolls out across the country, it's going to make music and video downloads more accessible to all Australians. It's time for the music industry to learn the lessons of the past decade and seize the initiative. But it seems you can't teach old gucci-clad dogs new tricks.

"If more action isn't taken by the government and ISPs to curb piracy levels the NBN could have disastrous results for the local industry," according to a major report from the International Federation of the Phonographic Industry. "All Australian content industries" will suffer if pirates are allowed to run rampant on the NBN, added Dan Rosen -- CEO of Australian Recording Industry Association.
It's really extraordinary that even in the face of figures that suggest digital sales are taking off, the recording industry is still demanding harsher measures against people who share unauthorized copies of files online, as if that ever worked -- or ever could work. For, as Turner rightly says: Ramping up the war on its customers won't see people start buying more music. It's a war the music industry can't win, but it seems determined to die trying.
Follow me @glynmoody on Twitter or identi.ca, and on Google+

Permalink | Comments | Email This Story

Game Of Thrones Director: I'm 100% Opposed To The Piracy I Just Said Helps My Show Survive

Timothy Geigner — Thu, 28 Feb 2013 08:50:00 PST

You know, sometimes content creators can be really confusing. Take Game Of Thrones director David Petrarca, for instance. Remember early last year when we mentioned that the show was on track to become the most pirated television show of 2012? And how the success of the show might actually be a result of piracy, rather than its cause?

Well, ChurchHatesTucker writes in to tell us that Petrarca recently opined that piracy is at least partially responsible for the success of the show, providing an avenue through which more people talk about it and comment on it within greater society.

Panel mediator Rosemary Neill noted Game of Thrones was the most pirated show of 2012 and that 10 per cent of the downloads came from Australia. But Petrarca shrugged and said the illegal downloads did not matter because such shows thrived on "cultural buzz" and capitalised on the social commentary they generated.

"That's how they survive," he told the crowd gathered at the University of Western Australia.

Yes, in addition to allowing late-comers to catch up on episodes in preparation for new seasons, piracy helps keep the show in the societal bloodstream, keeps the buzz going, and generally creates more excitement and awareness of the product as a whole. If HBO could manage to provide a more innovative method for delivering the show to those that want it, likely the boon could be even greater. Still, Petrarca noted that HBO is doing well with their subscriber base.

He said HBO alone had 26 million subscribers in the US and 60 million worldwide, which meant there was plenty of money filtering in and allowing the channel to produce high quality content despite any illegal downloading.

While this all sounds reasonable, I wouldn't want to be accused of not presenting the other side of the argument on whether or not piracy helps or hurts this sort of media. So, here to present a rebuttal to David Petrarca... is David Petrarca. He recently had a Twitter exchange with our own Glyn Moody, including these highlights.

I am 100% against illegal downloading. I said that downloading creates buzz but def am NOT in support of illegal downloads. The issue is a distribution system that gets content to viewers legally in a timely manner. People want to pay if made available.

While it should be noted that he certainly isn't being belligerent here, and he in fact notes that if a great distribution option is available fans will pay for content, it's difficult to square the first part of this statement with what he said in the article. Remember, he was specifically responding to a question about piracy (not authorized downloads) and then responded that it helped create social buzz for shows like his and "that's how they survive." But he is "NOT in support of illegal downloads?" I think I understand this to mean that he simply thinks the ideal solution is the kind of distribution platform that would drive nearly everyone away from piracy, by providing widely available, authorized downloads, and with that I'd agree. Still, in the absence of that great system, which HBO certainly doesn't offer, why staunchly state that you're 100% against piracy when you've already said it's helped you survive? I assume that Petrarca likes surviving, but perhaps I'm wrong?

Or, perhaps, the sudden attention that the original story was getting created pressure for him to walk back those statements. Glyn was not the only one that Petrarca reached out to with identical statements: Perhaps it's possible that, like many in the entertainment industry, Petrarca recognized that infringing copies were, in fact, good for his show, but that actually saying that leads to backlash from within. We've asked Petrarca whether or not he heard from anyone at HBO regarding his original comments, and will update this post accordingly should we hear back.

Permalink | Comments | Email This Story

Confusing Value And Price, Choir Demands £3000 Per Download

Tim Cushing — Mon, 7 Jan 2013 05:39:43 PST

If you asked most people what a single track is worth, most would answer with the going market price, which ranges from ~$0.79-$1.29. This is what the market has shown, for the most part, that it will bear. You veer too far away from the high end of that range and you'll find most people will opt for other music, cheaper music, or your music, fully detached from the high-end price tag.

Now, if you ask this same question of a certain 22-piece self-described "feminist alternative choir," the answer would be much, much different. Your initial estimate would need to be upped by approximately $4,850. Gaggle, the 22-member choir, has announced that they are selling their new single for £3,000 per download (no physical option exists). Why? Because they've chosen to use the persuasive power of economic fallacies to get people talking about "value."

Here's the womanifiesto:

"The Power of Money. What does money mean to you? How do you put a value on the things you care about? Is money the same thing as worth? Like it or not, money means that some people are rich and others poor, some considered successful, others failures. It determines your healthcare choices, education, clothes and how long you have the heating on for – whether you can have the things you want. But money is made up. Without our participation in the illusion, it's meaningless – in fact, if meaning equated to value, we would happily burn all the money tomorrow. Gaggle, of course, uses money. But Gaggle is an exercise in the power of other things as well – otherwise we wouldn't, and couldn't, exist. The Power of Generosity, Inventiveness, Courage. The Power of Flirting, Improvising, Blagging, Hard Work and Being Nice and Polite. The Power of Friendship, Faith, Obligation, Ambition, Anxiety…..Dreams. Without these Powers this track would not have been made. This song is precious. And yet, we're told that 'a single' is almost valueless. And that pisses us off. So we have done a budget of how much this single 'cost'. The many hours it took to write, arrange, compose, master; the expertise of all the musicians, technicians, designers, producers involved; the combination of all the Powers described above and more – we've totted it all up as best we can and… …we are putting this tune to market for the sum of £3000. The power of money? Let's see."

Well, good luck with that. It's been said time and time before, the customer has little to no interest in your fixed costs. This factor is completely irrelevant to purchase decisions, which are most often based on a more subjective perception of "value." While Gaggle may value their creation highly, it would be ignorant to assume that potential purchasers will value the track accordingly. In an era where creative output is at its highest, the sheer number of competing, cheaper options would be enough to bury this track's chances, even if Gaggle decided £5 was a reasonable amount to ask. (It isn't.)

Beyond that, there's some questions as to Gaggle's math. Are they intending for one sale to reimburse the entire creative effort? 10? 25? Wouldn't it be better to sell a few thousand copies at a price that people will actually pay, rather than pin the hopes of the collective on sales in the single digits? For that matter, wouldn't this scenario be more likely as well? And is it really fair to ask purchasers to support 22 musicians through the purchase of a single track? Aren't you running about 10-15 members over the upper limit for potentially successful bands that aren't named Broken Social Scene or Chicago?

But the issue at hand here really isn't £3000 or the perceived value of a single track versus the true cost of production. Gaggle's move here is a publicity stunt, primarily aimed at raising awareness of the band with a secondary aim of opening a dialogue about the value of artistic endeavors. All well and good except that it's rather hard to hold a discussion with a group whose opening gambit is to hurl themselves off the deep end while everyone else looks on in bemusement.

Permalink | Comments | Email This Story

EMI Was Actively Giving Away MP3s It Accused Michael Roberston Of Downloading Illegally

Mike Masnick — Thu, 27 Dec 2012 08:48:18 PST

You may recall EMI / Capitol Records ongoing lawsuit against MP3Tunes and its founder/CEO Michael Robertson. The initial ruling in that case went almost entirely against EMI, with one small exception that we'll get to soon. EMI asked the court to reconsider the ruling, claiming that it had made some mistakes, but the court slammed EMI for some questionable behavior, including taking a number of quotes completely out of context as an attempt to mislead the court. The latest on that case is that following the appeals court ruling in the YouTube/Viacom case that sent that case back to the lower court, EMI pretended that the ruling changed everything and required a new ruling. The two sides are currently filing motions back and forth over that, with MP3Tunes pointing out that nothing in that ruling actually changes anything, and EMI claiming otherwise. Given the narrow aspects of the Viacom ruling, I think that EMI is still unlikely to get very far. Still, it's fairly amazing how much time, money and effort it has spent on this case, even as the company itself got into serious trouble and was sold off in, effectively, a fire sale.

Which then brings us to the other aspect of the case. The one area in which EMI "prevailed" in the original case was in the part they filed against Robertson personally. The court had ruled on summary judgment that Robertson was liable directly for 47 songs that he had personally "sideloaded" into MP3Tunes. However, even that part of the case was strange. Initially, EMI had claimed that it had never, ever, ever authorized any MP3s to be given out for free for promotional purposes. In response, Robertson crowdsourced examples of over 1,400 cases where EMI was clearly giving away MP3s for free. However, the court still ruled that he was liable.

In the latest filing about that, Robertson hits back on a number of points, starting with the fact that the court ruled on summary judgment on the issue, even though EMI and Robertson had already agreed that the summary judgment part of the dispute wouldn't cover Robertson's personal liability. Because of that, he didn't present the full argument for why he shouldn't be liable, and thus he's asking that the court allow that part to go to trial in order to show that the evidence of his own infringement is lacking.

In order to support that, Robertson's filing demonstrates a few important things. First, it shows a bunch of evidence that EMI purposefully and deliberately marketed its music to various sites asking them to give away MP3s and even to share the music widely. Second, it shows that, despite being asked for this info during discovery, EMI did not provide it. Instead, Robertson got it later from other sources. This is a big no-no, and EMI may run into some issues for failing to hand over the required information during discovery. Still, what the filing shows is that EMI regularly and frequently hired companies to distribute MP3s for free, and encouraged them to be put up on various websites and shared widely. And this includes some of the songs that Robertson is accused of infringing and some of the sites he's accused of downloading the songs from.

Reading pages five through nine in the motion he filed demonstrates this over and over again, including in an email from an EMI Publishing employee, who not only is planning a promotional download but says part of the plan is to "encourage as many third party online zines, podcasts, blogs, major web portals to host the MP3 for free download on their site." Here's just a snippet of some of the examples Robertson turned up of EMI using free MP3s in marketing (which they did not properly disclose):

For example, Definitive Jux (an EMI label) entered into an agreement with viral marketing firm, Better Propaganda, which granted Better Propaganda the right "to use, copy, distribute, display and perform [a specified song] on and through the Internet and the World Wide Web..."). This song remains available on the Better Propaganda site. Plaintiffs did not produce this document....

Similarly, Astralwerks (another EMI label) engaged Toolshed, Inc. ("Toolshed"), a Viral marketing firm, to distribute sound recordings pursuant to a marketing program by which Toolshed would virally distribute free MP3 downloads through various blogs and Toolshed's own website. Importantly, Toolshed's webpage for downloads notes clearly that "All songs . . . are pre-licensed for use on your site. Simply browse, find music you like, and copy it to your page." .... Toolshed has done projects for numerous labels, including EMI labels Astralwerks, Capitol Records, Caroline Records and Definitive Jux Toolshed distributed free MP3s for numerous of Plaintiffs' artists -- including Air, Willy Mason, Bat for Lashes, Pacificl, Carbon/Silicon, The Perceptionists, and Amos Lee -- including one of the same artists that Robertson is accused of wrongfully sideloading.... Plaintiffs did not produce documents they exchanged with Toolshed relating to those projects.

One project by Toolshed is especially important: as emails (dated March 5, 2007) provided to Robertson from Toolshed indicate, Astralwerks paid Toolshed to get websites to give away MP3s for the new release of the album "Pocket Symphony" by Air, to be released on March 6, 2007.... Toolshed achieved coverage, including free downloads of a track and/or video placement, with numerous sites, including 3HiVe, Donewaiting, Kevchino, Music for Kids Who Can't Read Good, Muzzle of Bees, PopMatters, Sixeyes, Stereogum, Antville, and Kingbline..., some of the same sites and the same artist from which Robertson is accused of wrongfully downloading Plaintiffs' songs and which Plaintiffs have alleged are unauthorized sources of MP3's.... Plaintiffs did not produce such documents.

In many ways, this is reminiscent of the whole Dajaz1 situation, in which the lawyers are insisting that the distribution on various blogs is infringing, at the very same time that their marketing people are begging those same sites to offer up the songs as a promotion.

Separate from all of this, but in the same filing, Robertson hits back on the claims that the use of cover art in MP3Tunes infringed. The filing notes that MP3Tunes had licensed all the cover art from Amazon and that EMI never even bother to show that it held the copyright in the cover art. All they showed was that the company had copyrights in the songs, but that's different from the cover art (and made more complicated by the fact that the copyright in the cover art might belong to the artists who created the art, rather than EMI).

All in all, the filing reinforces what's already come out in the earlier rulings: which is that EMI seems to have an incredibly weak case here, but due to what appears to be a random infatuation with going after Robertson personally, is just throwing everything it can at him.

Permalink | Comments | Email This Story

Filmmaker Using BitTorrent & TopSpin To Distribute Free Copies Of Older Movie To Promote New Skateboarding Documentary

Mike Masnick — Thu, 30 Aug 2012 00:04:00 PDT

Skateboarder and filmmaker (often focusing his films on skateboarding) Stacy Peralta is releasing his latest skateboarding documentary, Bones Brigade: An Autobiography, about the Bones Brigade skateboarding crew -- Tony Hawk, Lance Mountain, Steve Caballero, Mike McGill and Tommy Guerrero -- which Peralta helped put together in the first place. Rather than go the traditional route with releasing the movie (as he's done many times, including with the acclaimed skateboarding documentary Dogtown and Z-Boys), Peralta has decided to go direct to fans. The movie was shown at Sundance earlier this year, where it got some attention and had a bunch of opportunities to go with traditional distribution partners, but instead Peralta figured it was time to take control, noting that the DIY ethic of direct-to-fan is similar to the way skateboarding evolved in the early days:

As skateboarders, as people that have always lived on the outside, have always had to sneak over fences or through the back door, have always had to create our own terrain, we’ve decided to put that ethic towards how we release “Bones Brigade: An Autobiography.” We turned down all of the conventional offers for distribution when we came out of the festival in favor of doing it ourselves.

One part of this DIY approach is that to promote this new movie, Peralta teamed up with BitTorrent and TopSpin to help with direct-to-fan digital distribution and promotion. Via BitTorrent, people can download a "Bones Brigade Bundle," including a bunch of extras, and then using a TopSpin feature (either on the web, or directly in the uTorrent client), if you submit your email address, you can download an entirely free copy of the classic skate film, The Search for Animal Chin, which was released 25 years ago, and featured the members of the Bones Brigade. So the combined effort, from Animal Chin to the Bones Brigade documentary is sort of a "full circle" situation.

It's great to see more filmmakers really embracing both direct-to-fan, but also realizing that things like BitTorrent aren't automatically bad, but have a place in a marketing campaign as well. In this case, it's interesting to see Peralta using a combination of a few different tools to create an integrated and comprehensive campaign not only to market the new film, but also to distribute the old film (the first time it's officially available in digital format). Oh, and if you'd like to download The Search for Animal Chin, there's an embedded widget right below this sentence...

Permalink | Comments | Email This Story

People Are Willing To Pay, Even If You Offer Something For Free

Mike Masnick — Tue, 21 Aug 2012 14:34:00 PDT

Last week, we relaunched our Techdirt Insider Shop with a number of new and different offerings, including (for the first time) the ability to do a "pay what you want" option to get some downloads, starting off with downloads of my book, Approaching Infinity, as well as the research report we came out with earlier this year, The Sky is Rising. We often hear from critics that if people can get something for free, they will, but here's a clear cut case of where that's not true (though we've seen it in many other cases as well.) It's only the early going with our store, but already, we've seen that two thirds of people who got the books decided to pay for it, with the average price being just under $5. Over 20% of orders were for $10 or more. We'll be curious to see what happens over time and if it changes. But, once again, it seems to suggest that, even if you're giving content away for free, if people want to support you, they will.

Permalink | Comments | Email This Story

Why Does An Unpatentable 'Abstract Idea' Become Patentable If You Add 'On The Internet'?

Mike Masnick — Mon, 12 Mar 2012 05:53:35 PDT

Back in 2009, we wrote about a case involving a company called Ultramercial, which held a broad and ridiculous patent (7,346,545) that effectively covered the process of watching an ad before you could download content (seriously). Ultramercial sued Hulu, YouTube and WildTangent over this. The case went back and forth with an initial ruling that rejected the patent, by noting that it was just an "abstract idea" and abstract ideas are not patentable. As that court ruling noted:

At the core of the '545 patent is the basic idea that one can use advertisement as an exchange or currency. An Internet user can pay for copyrighted media by sitting through a sponsored message instead of paying money to download the media. This core principle, similar to the core of the Bilski patent, is an abstract idea. Indeed, public television channels have used the same basic idea for years to provide free (or offset the cost of) media to their viewers. At its heart, therefore, the patent does no more than disclose an abstract idea.

Tragically, CAFC, the appeals court that handles patent matters and has a long history of expanding patent law, reversed the lower court's ruling and deemed the patent valid. While it didn't put it in these words specifically, it certainly appeared that the court was saying that any abstract idea can still be patentable if you just make it happen "on the internet."

In that ruling, the court discusses the fact that "abstract ideas" are not patentable, and notes that it used to use its machine-or-transformation test to determine if something was or was not an abstract idea. However, after the Supreme Court ruled in the Bilski case that this test might not always be appropriate, while failing to say what test would be appropriate, it's left CAFC with the freedom to make up totally arbitrary rules. And in this case, the arbitrary rule was effectively "we don't apply the machine-or-transformation test to 'information age' inventions." Why? Because if the inventions aren't physical, the machine or transformation test no longer applies:

While machine-or-transformation logic served well as a tool to evaluate the subject matter of Industrial Age processes, that test has far less application to the inventions of the Information Age.... Technology without anchors in physical structures and mechanical steps simply defy easy classification under the machine-or-transformation categories.

Shorter version: what would be considered unpatentable abstract ideas in the offline world suddenly become patentable if you add "on the internet" to them.

That doesn't sound right to lots of people, and thankfully WildTangent is appealing the case and hoping the Supreme Court will hear it. As the petition to the Supreme Court notes, the question presented is:

Whether, or in what circumstances, a patent's general and indeterminate references to "over the Internet" or at "an Internet website" are sufficient to transform an unpatentable abstract idea into a patentable process for purposes of 35 U.S.C.

Along with the petition, there were also two interesting filings in support, urging the Supreme Court to hear the case. One from Redhat, CCIA and EFF, which goes into great detail about how such broad patentability would seriously harm the open source world, and a strongly worded brief from Google and Verizon (yes, together) about how such a ruling would do serious harm to innovation by allowing all sorts of abstract ideas to be locked up via patent. Hopefully the Supreme Court is willing to listen -- and will push back (yet again) on a bad CAFC ruling.

Permalink | Comments | Email This Story

Schrödinger's Download: Whether Or Not An iTunes Music Sale Is A 'Sale' Depends On Who's Suing

Mike Masnick — Fri, 10 Feb 2012 11:36:00 PST

Steve Worona has a great post pointing out how the record labels have clear cognitive dissonance (the ability to hold two totally conflicting ideas in your head at the same time -- and argue for both of them) when it comes to the question of whether or not an iTunes purchase represents a "sale." He puts forth three examples of such cognitive dissonance in the legal context, with the final one being taken from two recent legal cases involving major record labels:

Example 1, the case of the kettle. As summarized by the Manhattan Institute for Policy Research, “Readers who’ve been to law school may remember the chestnut known as the ‘Case of the Kettle’. A man is charged with borrowing a kettle and breaking it. His reply is that, first, he never borrowed it; second, it was already broken when he borrowed it; third, it was intact when he returned it.”

Example 2, the case of the dog. Paraphrasing from a 1978 Wall Street Journal article about well-known Texas defense attorney Richard “Racehorse” Haynes: You say my dog bit you, but I don’t own a dog, and he doesn’t bite, and you kicked him first.

Example 3, digital downloads. Two recent court cases hinge on how the sale of an MP3 download compares to the sale of a conventional physical recording, known as a “phonorecord” in Copyright-speak. In one case, the singer Eminem demanded that Universal Music Group calculate his royalties for downloads based on the higher rate for licensed material instead of the lower rate for phonorecord sales. UMG refused, arguing that the sale of an MP3 download was the same as a phonorecord sale. In the second case, EMI filed suit against ReDigi, a company that allows purchasers of MP3 downloads to resell those files under Copyright law’s “first sale” doctrine. EMI argued that the MP3 files were not phonorecords and thus not subject to first sale.

What's being discussed here, of course, are two cases that we've covered. The Eminem case involved whether or not an iTunes purchase counted as a "sale" like a CD, where there was a very low royalty rate (probably around 15%), or as a "license" like for a movie, where the royalty rate was more like 50%. Universal argued stringently, and continues to argue in a series of follow-up cases, that an iTunes purchase is just like a CD purchase, and the much lower rates apply. However, in the ReDigi case -- where the company is trying to argue that if an iTunes purchase is just like a sale, then clearly the "first sale doctrine" applies and those files can be resold -- EMI, which is in the process of being acquired by Universal, argues that an iTunes sale is a license, and thus there's no first sale.

Worona sums it up beautifully:

Putting these two arguments together, we see the music industry imagining transactions where what’s sold is a phonorecord but what’s purchased isn’t.

To me this seems like the Schrödinger's Cat of copyright law. According to the record labels, if we're talking about it from the seller's perspective, it's a sale. But the second you flip the equation and look at it from the buyer's perspective, it's a license. The cat is simultaneously dead and alive. Either the major labels are full of it... or they're breaking new ground in quantum physics. I'll assume it's the former, rather than the latter.

Permalink | Comments | Email This Story

No, The Supreme Court Did Not Legalize Downloading

Mike Masnick — Thu, 6 Oct 2011 15:08:51 PDT

First things first: I've appeared on The Alyona Show on RTTV a few times in the past, and have always enjoyed it. I don't know much about Russia Today, the operation behind RTTV, though some have argued that it's a propaganda arm for the Russian government. My general position on these things is that if people want to interview me about the subjects that I'm interested in, I'm happy to talk to anyone. I've done interviews for NPR and the CBC as well, and I've given a talk for execs at the BBC, all of which are also government supported media.

However, to be a credible news source... you have to at least be able to get the basics right. On Monday of this week, we wrote about the Supreme Court's decision to let stand a Second Circuit appeals court ruling, saying that a download did not require extra royalties for also being a public performance. It's basically a licensing dispute over what licenses need to be paid if you're offering downloadable music. Interesting, but not a huge deal.

So I was a bit shocked to see a headline declare that the Supreme Court legalizes downloading music, because that's simply not true. I clicked through... and it's from RTTV, who apparently understood this story so little that almost nothing in the headline or opening sentence is accurate. On the assumption that perhaps they'll change or pull this down, here's a screenshot: First up, the Supreme Court didn't do anything other than refuse to hear the appeal of ASCAP, allowing the Second Circuit case to stand. So it didn't legalize anything. Nothing in the Supreme Court's decision not to hear the appeal indicates a change to any law, let alone something as crazy as "legalizing downloading music." Second, the opening sentence is also completely bogus. Downloading music is already an infringement of federal copyright law. Nothing in this case would change that one way or the other. All it concerned was whether or not services that offer downloads have to pay a separate "performance" license to ASCAP for the downloads. Nothing in this is about legalizing (or illegalizing) downloads. Services already pay licensing rights to distribute a copy of a file. The question is whether or not they had to pay even more, if downloading also constituted a "public performance," which is covered by a different right under copyright law.

No matter what your position is on copyright law, or this particular case, making totally ridiculous claims, like the Supreme Court legalized downloads, is flat out ridiculous, and suggests not only did someone not understand the case at hand, but didn't even bother to read the most basic information about the case.

Permalink | Comments | Email This Story

US Supreme Court Lets Stand Ruling That Says Music Downloads Are Not Public Performances

Mike Masnick — Mon, 3 Oct 2011 15:55:18 PDT

Ah, ASCAP. The music collection group that keeps getting more and more desperate, seems to have finally and completely lost its quixotic attempt to claim that a music download represented a "public performance," which required a separate license, beyond the mechanical reproduction license. The group had been in a legal fight with Yahoo and Rhapsody over whether or not those companies had to pay extra to songwriters (whom ASCAP represents) in addition to the money they were already paying to license songs from the record labels for downloads. The district court sided with ASCAP and presented a bizarre formula involving a percentage of all revenue (such that Yahoo would have to pay some of its search revenue to ASCAP for no clear reason). Thankfully, an appeals court overturned the ruling, noting that a download is not a public performance, and that the bizarre calculation rate didn't make much sense. ASCAP (of course) appealed to the Supreme Court, which has declined to hear the case, meaning that the appeals court ruling stands. This isn't a definitive rejection of "download = public performance," as technically, it's just the law in the Second Circuit. In theory, some other Circuit could rule otherwise, and create a circuit split for the Supremes to look at. But, that's probably unlikely, and it's most likely that this ruling effectively makes it clear across the country that a download is not a public performance. As it should be, because it's not.

Permalink | Comments | Email This Story

Fox Responds To 'Piracy Surge' By Answering A Different Question

Mike Masnick — Wed, 24 Aug 2011 09:57:28 PDT

Exactly as we predicted, when the Fox Network hid its TV shows online behind various paywalls and delays, the rate of infringement on those shows shot way up. Eriq Gardner, over at THResq spoke to a Communications VP at Fox to get his response about all those people going to unauthorized means to get their content, and in true "Communications VP" fashion, Scott Grogin deftly ignores the key question and focuses on a secondary claim from the original TorrentFreak article, the suggestion that these delays were about getting people to watch TV live:

The TorrentFreak blog post is a little over the top. The story indicates that we 'took this drastic step in the hope of getting more people to watch shows live and thus make more revenue.' Nothing could be further from the truth.

Authenticating viewers is not about making sure they only watch live...in fact, quite the opposite—we support a 'TV Everywhere' proposition and are working with our distribution partners to benefit our businesses. It's about receiving fair value so we can continue to produce this expensive and high quality programming. We are pursuing a strategy where the 90+ million households who pay to watch our programming via cable/satellite/telco will ultimately receive maximum benefit. They can watch live, via DVR, on VOD, online, or through one of the various tablet apps that allow in-home viewing.

We are actively in negotiations with all cable/satellite/telco providers regarding authentication of their customers. We hope to announce several more agreements before the start of the new television season in mid-September.

The issue of watching "live" or not is really a side matter, and was perhaps a bit of hyperbole from TorrentFreak. What those guys clearly meant was that this is a weak effort by Fox to keep people watching via TV or via a big cable/satellite provider. And, I'm sorry, but this line is pure bull:

We are pursuing a strategy where the 90+ million households who pay to watch our programming via cable/satellite/telco will ultimately receive maximum benefit.

Anyone who claims that to offer maximum benefit to one set of people, you have to take away features from others isn't being particularly honest. To offer maximum benefit, you offer maximum benefit. Could Fox offer new additional features to such subscribers? Sure. That would be interesting and perhaps a good strategy. But taking the content away, when it's so readily available via unauthorized means doesn't help provide maximum benefit to subscribers at all. It drives more people to unauthorized means of access (where Fox gets no money at all), and actually takes away value from those subscribers. That's because one reason why people watch hit shows right away is so they can discuss them with friends. Fox has now made it more difficult to discuss with friends because it's that much harder to watch its shows.

Permalink | Comments | Email This Story

Of Course: New Fox Delay Means More Unauthorized Downloads Of Fox Shows

Mike Masnick — Mon, 22 Aug 2011 12:24:54 PDT

Back in July, when the Fox Network announced plans to block or delay many of its popular shows from going online, we predicted this would increase the number of unauthorized downloads. This just seemed stupid. People want to access it online and they will access it online. Why not offer it to them in an easy and convenient manner that can be monetized. Of course, when others pointed out the same thing, the geniuses at the MPAA threw a hissy fit about how even admitting that Fox's stupid business decision might increase unauthorized file sharing was the equivalent of praising "stealing."

So, um, I wonder how the MPAA's brilliant strategists will respond to the news that, in the first week of Fox's delays alone, unauthorized downloads of some of its most popular shows increased massive amounts, doubling or tripling what they were before. In fact, that article notes that many of the people viewing it through unauthorized means left comments about how they tried to watch via legal channels, but couldn't.

So I'm wondering how the folks at the MPAA might explain this. Are they going to throw another tantrum and blame "reality" for supporting file sharing? Or will someone there finally buy a clue and recognize that not providing consumers what they want is a bad business decision. I guess that would require someone at the MPAA to actually have experience in business -- but they all seem to be lawyers or political flunkies.

Permalink | Comments | Email This Story

AC/DC Says Their Songs Will Never Be Available For Download; Rest Of Internet Laughs

Mike Masnick — Mon, 9 May 2011 10:00:49 PDT

Capitalist Lion Tamer points us to the news that the band members of AC/DC are standing firm in saying that they will never allow authorized versions of their music to be sold online for download. The logic here seems to be entirely lacking. The band claims that it's because they want people to listen to the whole albums, not just tracks, but if that's the case then they should just release the whole album as a single track. The fact is that anyone who has their albums can choose to listen however they want. And any time one of their songs is played on the radio, only one song is heard -- yet you don't hear them talk about boycotting radio. But, of course, the bigger issue is that it's silly to not offer an authorized way for people to pay you for your music, when the alternative that plenty of people will choose, instead, is to simply download unauthorized versions where the band has no say at all.

Permalink | Comments | Email This Story

Band Complains About Massive Downloads Destroying Sales; Researchers Can't Find Any Downloads

Mike Masnick — Mon, 4 Apr 2011 14:27:21 PDT

We've mentioned before the Recording Industry astroturfing site in Canada, called "Balanced Copyright for Canada," which is about anything but setting up a "balanced" copyright system in Canada. However, apparently, there was a recent "debate" on that group's Facebook page about some poor Canadian band (who I'm not going to bother naming, for reasons that should become obvious), who put out a press release claiming that it had "gone platinum," if unauthorized downloads were counted. The band claimed that its album had been downloaded over 100,000 times, and complained about people "stealing" from them.

Of course, one curious participant in the debate, Wayne Borean, began to question this press release. He went out and searched the various torrent search engines/trackers, and even searched Google with the filetype:torrent search and came up with no results. In other words, it's not just unlikely that the band's work has been shared 100,000 unauthorized times, it's unlikely that it's being shared at all. TorrentFreak jumped into the fray, and noticed very few Twitter followers, and almost no YouTube views on the band's channel, and also began suspecting stuff. After pressing the band's manager for "proof," TorrentFreak discovered that it came from an search form that returns fake results.

Thus, it does not appear that the band purposely mislead people, but it appears that they don't seem to realize that you can do searches on pretty much any made up thing on certain sites and it will tell you there are tons of results. Of course, since this info has been presented, the band claims that "the music thieves are after us now." Or, they're not. Which might actually be a bigger problem for the band.

Permalink | Comments | Email This Story

BPI Effectively Admits That Digital Economy Act Was Useless

Mike Masnick — Fri, 17 Dec 2010 01:19:52 PST

Every time I come across BPI, the UK's version of the RIAA, I'm amazed at how single-minded its focus seems to be. There's little interest in improving profitability for record labels. There's little interest in creating better music. There's little interest in smart new business models. It's only about "piracy" and how evil it is. What's funny is I saw the BPI's Geoff Taylor on a panel a couple years ago, and he was one of the people who would say two sentences in a row that would contradict each other. It was always something along the lines of: "We should stop 'going to war' with our customers... but first we have to stop piracy!"

This past year was a banner year for BPI. The UK market has bucked the trend in pretty much every other part of the world and has seen recorded music sales growing, while its overall music industry (if you count how much money musicians actually make -- beyond just recorded music sales) has been growing for quite some time. Even with all of that, BPI was able to push through the incredibly draconian Digital Economy Act in the UK via questionable means.

So BPI should be thrilled, right? In the midst of a recession, and a massive decline in recorded music sales everywhere else in the world, it was able to buck that trend even before it got this new law passed.

But no, to BPI, absolutely everything is about "piracy." It's put out a new report whining that "piracy" is still increasing and saying it's all Google's fault. Of course, this isn't a surprise as BPI has been trying to set Google up for a lawsuit.

Of course, by my reading of this new study, BPI is effectively admitting that the Digital Economy Act was useless. The industry was already growing before it, so the main reason behind it was to help slow down the dreaded "piracy." And it failed in doing that. So, shouldn't BPI now support a repeal of the Digital Economy Act?

Permalink | Comments | Email This Story

Oh Look, Digital Downloads Aren't Saving The Music Industry

Mike Masnick — Mon, 13 Dec 2010 16:23:33 PST

About a year and a half ago, I gave a presentation at a music industry event, where one of the points I tried to make was that those who were betting on digital sales as a savior were making a fool's bet. However, many in the industry have been infatuated with this idea, even if the evidence always suggested that digital sales would only ever make up a small fraction of what CD sales used to bring in. Earlier this year, we warned that the growth rate was slowing, and now as we hit the end of the year, it's confirmed that while there's still some growth, it's slowed down dramatically. Betting on digital sales as the key business model for music is, and is going to remain, a mistake. There are lots of other opportunities to make money, but you have to think beyond just selling music.

Permalink | Comments | Email This Story

France Gets Taxpayers To Subsidize Music Downloads

Mike Masnick — Thu, 14 Oct 2010 10:32:52 PDT

Nicolas Sarkozy had talked in the past about taxing Google, Microsoft and Yahoo to fund the recording industry. Apparently, in the meantime, he's just going to tax citizens instead. The EU has apparently given approval to a plan that will have the French government paying half the cost of special music download cards, with the goal being to attract users to pay the half-price fee to get them using authorized music services. Of course, it seems worth pointing out that Sarkozy's wife is a recording artist, so it does seem a bit unfair for him to have taxpayers forking over money which is going to end up with his wife. There are, of course, also anti-competitive concerns when the French government is subsidizing specific music services, but the EU apparently claimed that the "benefits" of the plan outweighed those issues. What benefits? If there are benefits to offering music for less then, um, shouldn't the record labels just be lowering their prices?

Permalink | Comments | Email This Story

Questionable Site Claims To Legally Offer Unlimited MP3 Downloads... Record Label Lawyers Already Springing Into Action

Mike Masnick — Tue, 31 Aug 2010 12:35:14 PDT

What is it with random companies springing up claiming to have legal download offerings that don't pass the laugh test. Remember a year ago, we talked about a company called Bluebeat.com that claimed to be the only site where you could legally buy Beatles MP3s, based on a bit of absolutely ridiculous logic, that it was using "psycho-acoustic simulation" to recreate the tracks, thereby giving it a brand new copyright. That company also got a registration for these "new" works by the Copyright Office, hoping that most people wouldn't notice that the Copyright Office registration process is a pure rubber stamp effort, and conveys no actual legitimacy to a bogus copyright.

Well, it looks like we've got another similar situation, as some mysterious company called ZapTunes is claiming to offer unlimited MP3 downloads for $25/month -- with an initial "free" period, though you have to hand over your credit card details. The whole thing sounds highly questionable, however. The store claims to have licensed the work from all the major labels, including being able to offer Beatles MP3s and AC/DC MP3s -- which have not been offered in MP3 format anywhere.

In the comments on that Hypebot article, some point out that the company appears to just be scraping Last.fm data, as it found a track that one guy had created himself, which only lived on his computer (but which had been "scrobbled" and the info was sent to Last.fm). The company also claims to have raised "about $5 million in funding from various Venture Capitalists," but doesn't seem to name any of them.

Despite the claims from the company that they've secured the necessary licenses for this, it appears not everyone agrees. EMI is apparently already starting the legal process. The whole thing really makes me wonder if these sites honestly think that people will buy their claims when there seems to be little evidence to support them. There are plenty of sites out there that offer up such content in a clearly unauthorized manner -- but at least they're honest about what they do. It seems pretty silly and destined to fail massively to falsely claim the legal rights to music you almost certainly did not license.

Permalink | Comments | Email This Story

New Zealand Media Claiming That Huge Local Film Success Story Is Being Harmed... By 200 Downloaders?

Mike Masnick — Thu, 24 Jun 2010 10:54:27 PDT

Reader Matt Perryman points us to a bizarre story down in New Zealand, which he claims is all over the news. Apparently, a local movie, called Boy, has been a huge success -- having the third most successful box office of a New Zealand film ever. Not bad, right? But, months after the film has been out in the theaters, it's now been leaked to the internet, and suddenly the media frenzy is about just how much this is "costing" the filmmakers. No evidence (at all), is presented. They just claim that a leak like this will cost a million dollars. Even more amusing, at the time these reports came out, they said that the movie had only been downloaded 200 times. But, if you look at the comments on that article, a ton of them are thanking the publications for letting everyone know the movie was available for download. Of course, many of the commenters are also pointing out that they don't live in New Zealand, and there was no way for them to see the movie otherwise... meaning that those downloads aren't losses at all. But, it seems the reporters never bothered to mention that rather important fact.

Permalink | Comments | Email This Story

Yet Another Attempt At Ad Supported Music

Mike Masnick — Tue, 29 Dec 2009 20:52:00 PST

Back in October, we wrote about plans for yet another "free, but ad supported" music download startup, but didn't see how the economics could work out. That site, FreeAllMusic, is apparently now getting set to launch, but it still doesn't make much sense to us. Basically, you can download music (two of the four major labels have signed up) for free -- and it's not encumbered by DRM (that's good), but you have to sit through some sort of video ad before you can get the music and you are limited in how much music you can download. The site's CEO claims "We have made this process easier than stealing."

We'll ignore the confusion (most likely intentional) about the difference between infringement and "stealing" and focus on all the other problems with this service. First of all, it's not easier than infringing. You have to sit and watch an ad. You don't have to do that on file sharing networks. Second, the assumption behind the service is that people would use this the same way they use iTunes: meaning only a very small number of downloads per month. Initially, that means 20 downloads per month, total, and no more than five per session. That may be how people use iTunes, but that's because each download costs money in iTunes. One of the reasons people prefer file sharing systems is because they're not limited that way and can really easily sample lots of music quickly.

But the biggest problem with this concept remains with the basic economics. Since the argument remains the same as I stated a few months back, I'll just repeat it:

You've got the record labels, who are used to getting approximately $0.67 per downloaded song. Assuming that needs to be made up by the ad (and even ignoring any profit for the site), then every single ad shown needs to cost that same $0.67. Translated into traditional ad terms, that's a CPM of $670. Yikes. I don't know any advertiser will to pay anything close to that -- even if it's targeted and you have a half decent chance of the person paying attention. Most CPM ad rates online these days are in the sub-$5 area. Convincing advertisers to jump to a $670 CPM on an unproven model? Good luck.

I'm all for experiments and new business models -- especially those that make use of free music. I just don't see this particular one getting very far. The economics are just not that compelling for anyone involved.

Permalink | Comments | Email This Story

Once Again, You Don't Compete With Innovative New Services By Being Lame

Mike Masnick — Thu, 12 Nov 2009 06:28:00 PST

A couple years back we pointed out how the entertainment industry kept trying to "compete" with new (legal and not-so-legal) online services, but always seemed to do so by being incredibly lame. And, you don't compete by being lame. It appears that this message still hasn't quite gotten through to some yet. With the movie industry facing new challenges concerning online distribution and innovative services like Redbox, here are two stories of old school players trying to "compete" but missing out on the part where they make their offering compelling.

The first comes from Josh in CharlotteNC, who points out that Blockbuster is trying to compete with Redbox and its widely available kiosks (and Netflix with its larger library of downloadable movies) by setting up kiosks in its stores where you can download movies. But... you can only download them to proprietary SD cards, and then it can only play on special proprietary hardware that participants in this program need to have. How is that a better experience then, well, anything? If you want a movie that can be downloaded, why not just let people download it at home? Why have people go out to download it?

Then we have a story sent in by Loydster, about how Sony Pictures is offering owners of new Sony/Bravia HDTV's the chance to download and watch the movie Cloudy With a Chance of Meatballs before the DVD release. While that is actually a nice tie-in between Sony's content business and its consumer electronics business, Sony (of course) has to screw it up. That's because the company thinks it can charge $25 to download the movie. The company seems to admit that it's charging this much because it doesn't want to piss off its retail partners (like WalMart), but it's difficult to see why it's worth doing the project at all if the pricing is going to be so ridiculous.

Experimenting with ways to compete is good... but being so obviously lame is not.

Permalink | Comments | Email This Story

Movie Makers Use 'Fake' Piracy Numbers To Score Distribution Deal

Mike Masnick — Wed, 2 Sep 2009 19:39:01 PDT

The NY Times recently had a blog post noting that the makers of an $850,000 romantic comedy called X's and O's were thrilled that their movie was widely shared on file sharing networks, because the attention it got helped land them a big DVD distribution deal, and potentially a television deal, helped along by the attention received from that file sharing. Of course, there's just one little problem. The FreakBits guys noticed that the number of downloads the movies' creators are citing are almost certainly false. Apparently some sites post fake download numbers as a part of their advertising, and the movie makers used those fake numbers. But... it seemed to get them attention to get more deals, so more power to them. No matter what, it suggests that (once again) obscurity is a much bigger problem than piracy.

Permalink | Comments | Email This Story

New Study States The Obvious: Kids Download A Lot Of Music

Mike Masnick — Tue, 11 Aug 2009 04:40:00 PDT

Over the past few months, there's been a push among some to suggest that file sharing is really a marginalized behavior, only done by a small group of people -- and that with just a little education (and maybe a few big legal victories, such as the ones against Jammie Thomas and Joel Tenenbaum -- combined with new services like Spotify), perhaps it can be brought "under control." The "evidence" given for this has often been a case study in how to use statistics to delude yourself, often looking at the total percentage of people or internet users who engage in file sharing. But, the fact is that ignores the real issue: which is that kids today (tomorrow's consumers) are file sharing at a very high rate. A new study, sponsored by UK Music (the UK organization that's looking to get ISPs to put in place some sort of blanket licensing plan) has found that over 60% of kids in the UK admit to file sharing, with 83% of those admitting to doing it regularly, and those surveyed claiming to have downloaded an average of 8,100 tracks. Think about that for a second. 8,100 tracks.

While the defenders of the old system want to liken file sharing to a problem like shoplifting, at some point you have to realize it's something entirely different. This isn't a marginal behavior done by "bad kids." This is about as common as can be. Oddly, the BBC tried to spin this report to say that file sharing has dropped, but that "drop" was only 2% and it's within the margin of error of the survey -- meaning there's no actual evidence that it dropped. The study also contradicted that other study we wrote about recently (also in the UK) that claimed that kids were replacing downloading with streaming services. In this survey, 78% said they had no interest in a streaming service, and 89% saying they'd never pay for such a service.

Given the two conflicting studies (both sponsored by biased parties), you have to question the results of both. But, given the fact that kids are more likely to deny file sharing activity these days, rather than admit to it (knowing they could get in trouble for it), you have to wonder if this study even undercounts the actual activity.

Now, once again, let's make a clear point: I'm not saying this is right or legal. I don't think anyone should download music from an artist who does not authorize it. But the fact is that file sharing is not a "small thing" among kids today, and to think that there's some sort of magical method of getting it to go away is wishful thinking. Given that we're seeing more and more artists learn how to embrace file sharing to do better with their own business models, at some point it's time for those fighting against it to recognize -- from the copyright holders' perspective -- that it's better not to fight what consumers want, but to embrace it, combined with a smart business model, and stop worrying.

Permalink | Comments | Email This Story

Video Game Downloads Harming The Used Video Game Market?

Mike Masnick — Thu, 30 Jul 2009 21:14:00 PDT

We've had a bunch of articles in the last couple years about video game execs complaining about the used video game market, saying that they deserve a cut of any such sale -- or that the used market should be banned altogether. This, of course, is short-sighted, as studies have shown that a healthy secondary market improves the primary market by adding value to the product (i.e., people may be more willing to buy the new product, knowing they'll be able to resell it later). And, of course, the market has a way of dealing with these things.

So, it's a bit amusing to now see sort of the flip side to that story (sent in by the amusingly named "Just Another Moron in a Hurry") -- with some warning that the rise in direct downloads of video games is threatening the used video game market, and that may be bad for consumers as well. Obviously, those games can't be resold (at least not easily), and thus there isn't a cheap price entry point for consumers, as there is with used packages games. Again, even though this is complaining from the other side, I'm not sure it's really that big of a deal either, as the market again should start to deal with this situation. Being able to offer games direct to consumers should lower video game production costs (no more packaging/shipping/logistics/hard goods/etc.) and, even they don't initially, eventually the prices should reflect that, as well.

Permalink | Comments | Email This Story

eMusic Also Took Away Right To Download Songs Already Purchased

Mike Masnick — Thu, 25 Jun 2009 08:40:00 PDT

In all the fuss over eMusic's poorly managed plan to sign Sony Music and raise prices at the same time, the company apparently also was able to sneak through another anti-customer move. For years, as an eMusic customer, you were able to go back and access songs you'd previously downloaded. This is, for obvious reasons, a very useful feature -- especially considering the fact that people change computers or lose hard drives and such. However, apparently, along with the price increase, eMusic has quietly dropped this feature as well. It's not clear why they would do this. Perhaps Sony didn't want this, but that doesn't explain why the feature was removed for everyone. It's like eMusic is punishing their loyal customers. The company claims that it will allow people to redownload if there's a technical problem, but the convenience feature is just gone.

Permalink | Comments | Email This Story