Yesterday the Wall Street Journal reported that the Recording Industry Association of America (RIAA) fired MediaSentry, the Recording company it used to help it gather evidence for mass lawsuits it filed against people it claimed were illegally uploading copyrighted music. It would seem that the RIAA is finally coming to its senses and realizing that the way forward is not to use scare tactics or sue, but perhaps to accept the new technologies and maybe even embrace them.
Back in the days, not so long ago, when the LP ruled the music store, analog recordings of music did not get the recording industry all worked up into a lather. Each successive generation of an analog copy suffered from an increasingly pronounced degradation in sound quality, and all was right with the world. Enter the digital revolution, where cassette tapes are no longer the copy mechanism of choice. With digital recording, when done properly, there is no degradation in sound quality past the first generation, no matter how many subsequent generations of copies are made. Moreover, with digital recording, the first generation copy will suffer from almost no perceivable degradation in quality when compared to the original. In this digital age, according to the recording industry, all is no longer right with the world, and if you let yourself get caught up in the hype you are likely to expect the lion and the sheep to be laying down under the tree any day now, with other apocalyptic horrors soon to follow.
The truth is that with the advent of compression technologies, such as MPEG-1 Audio Layer 3, commonly referred to as “MP3,” the Internet, which was previously of little use for the distribution of music, increasingly become the place to turn for music. In the olden days of the Internet, it was just not possible to send music files electronically because a good quality recording could easily take up 60 MB of space. On a 28.8 KB modem who wanted to wait that long for a song? The emergence of MP3 technology, which can take that same 60 MB song and compress it to 5 MB or less, coupled together with high speed Internet access, today music aficionados can choose from a plethora of legitimately sold MP3s, which can be acquired through the numerous subscriptions services such as Apple’s iTunes, and illegally copied music acquired through such nefarious sources.
The Recording Industry Association of America unsuccessfully attempted to kill compression technologies and for the last 5 plus years they terrorized anyone they could catch who was downloading music illegally. Of course, downloading music illegally is not something I advocate, but from a business standpoint there never is any justification for suing potential customers. Rather than embrace technology and see what Apple saw, which was a huge new revenue source, the RIAA wanted MP3 users to believe that there is something inherently evil about the technology, and it must be avoided at all costs lest we see our society devolve into an anarchistic world.
Hopefully by now everyone knows that MP3s are not evil. Who knows, perhaps the RIAA will someday figure that out as well, if they have not already. What we can and do all agree on, however, is that there is an alarming amount of copyright infringement occurring via transmission of copyrighted music over the Internet. It is the copyright infringement that is bad, not the technology. This may seem like a simple enough statement, but one that has seemingly eluded the RIAA. It would seem that the RIAA is getting so caught up with hatred over MP3s that they are forgetting that the goal of copyright owners in our capitalistic intellectual property regime is to make money, not war. Hopefully the firing of MediaSentry singles an end to the digital music wars and the ushering in of an era of peace.
In an example of true market economics at work, Internet users and music lovers came to love MP3s, a truth that has spawned the creation of a long list of commercial subscription services aimed at legitimately selling MP3s. Meanwhile, as MP3 technology took hold, the RIAA was continually trying to kill the technology and once again tell the consumers what they should want to buy, rather than selling them what they demanded.
It will certainly be argued that the folks that the RIAA went after were not customers, which is exactly why they are being sued. There is a point to this, but it ignores a truth that any fan that has ever purchased a CD knows. CDs are generally priced in the $12 to $15 range, and each CD has one song worth listening to, while the others are all unwanted filler. At a price that ranges from $12 to $15 per wanted song, of course infringement is going to be an option. Simple economics says that if the price is too high demand will be lowered. The problem is in this case demand is not reduced, it is just transferred from legitimate copy to infringing copy. Therefore, thanks to a myopic hatred for MP3s and an aversion to new technologies, the recording industry caused exactly what they wanted to prevent; namely rampant copyright infringement. Of course, the RIAA tactics also lead to the tremendous success of Apple’s iTunes, so if you own any stock in Apple you might want to send the RIAA and its leadership a thank you card.
All of this leads back to the question, why? Why did the RIAA and it members not see this new technology as presenting an opportunity? The simple answer seems to be the same answer that has always been the case for established companies facing new technologies. The music industry simply has too much invested in the old business model, which is based on packaging artists of questionable talent, promoting them, making one song popular and selling CDs that include mostly filler. Failure to embrace a new opportunity is nothing particularly new for the entertainment industry. After all, if they had their way back in the early 80s VCRs would have been illegal. If the Sony case had gone the other way and VCRs were outlawed, what would the landscape of the entertainment industry look like today?
I am not trying to excuse the actions of those who are copyright infringers. To the contrary, intellectual property rights are critical to stimulating creativity and invention. But, when a copyright owner wants to hold too tightly to their right, then they deserve exactly what they get, which is nothing. In order to make money you need to give something up. Because the industry was unwilling to give anything, the people decided to take it, and now many think that under copyright law they have a fair use right to download copyrighted music. The only explanation I can come up with is that somewhere along the way the RIAA and its members have missed the boat and have caused exactly what they were trying to prevent. Those that think they have this fair use right are, of course, mistaken, but perception is far more important in reality when trying to win hearts and minds.
About the Author
|Eugene R. Quinn, Jr.
President & Founder of IPWatchdog, Inc.
US Patent Attorney (Reg. No. 44,294)
B.S. in Electrical Engineering, Rutgers University
Gene is a US Patent Attorney, Law Professor and the founder of IPWatchdog.com. He teaches patent bar review courses and is a member of the Board of Directors of the United Inventors Association. Gene has been quoted in the Wall Street Journal, the New York Times, the LA Times, CNN Money and various other newspapers and magazines worldwide