Month: May 2004

I’m sitting in front of my computer screen tonight, appalled at Bush’s response to the recent abuse of Iraqi prisoners.

The man never actually apologized in his entire speech. Usually an apology involves acknowledgement of doing something wrong, pledging that it will not recur, and saying you’re sorry. Bush stated he was “sorry for the humiliation suffered” by the Iraqi prisoners.

No apology for the conduct of the soldiers involved.

No apology for allowing it to happen.

Just a lame expression of empathy.

I’m usually a supporter of Bush on most issues, but this growing tradition in government and corporations of “third-party apologies”, like “I’m sorry for the pain you suffered”, or “I’m sorry you are offended” aren’t real apologies at all. They are a way of ducking responsibility while sounding sympathetic. And it just makes me want to vomit.

It’s not just him… he’s just the latest example of this trend that’s been bugging the heck out of me for months. I listen to it in corporate meetings. I read it on mailing lists. “I’m sorry you took offense at what I said”. Bah. Own up to your opinions, own up to what you’ve done wrong, own up to the fact you, personally, are responsible for the actions of your underlings, and must make personal restitution for them if they cannot.

I find myself wondering if this tendency springs out of having such a litigious society: if you acknowledge fault, you’ve just lost all chance of “plausible deniability” in court. What do you think?

EDIT by matthew: Broken link brought to my attention by an alert reader. Fixed.

Hello All, I have not had alot of time to post lately. My new job has been a bear. I did however come back for my second show at Quince Orchard H.S.. The Ironic thing about doing into the woods is that it was also the last show i did there while a student. the theatre’s website is QO THEATRE.

Hope you like the pictures.

Jon

EDIT by matthew: Fixed link, remember to use forward slashes (/)instead of backslashes (\) 🙂

One of my good friends up here was recently caught stealing cable (oops, sorry Matt, INFRINGING cable). He figured out how to splice some box on a telephone pole and concoct some funky wiring and divert signal to his house. This guy also had help from an electrical engineer.

The Weed rationale: why should he pay $45 a month for 100 channels of programming when he only wanted ESPN? Infringe it!

Control is assertable in markets in which technical competence, access or concealment is not available to the consumer.

The general public doesn’t know how to splice cable. The general public doesn’t know how to steal satellite. The general public doesn’t know how to steal the reel before it hits the movie houses. The economics of the media business is built on control and detection.

I think the decline of the control stems from the frailty of the distribution model. They choose to use the casette and CD media because it’s cheap. It’s also replaceable and repeatable by the consumer. You can’t enforce the economics of the business because there’s a loss of control.

I foresee a future in which music labels become entertainment wholesalers that license catalog to consumer electronics hardware and service fulfillment providers. These providers will operate as clearinghouses of multiple media banks and service delivery to the home through “smart boxes” that are interactive. I’m not sure if this box will be a computer. I’m not sure that the personal PC interface will even be the same! Thus, I think that as it gets harder and more expensive to build celebrity, the economics of recorded music won’t show enough yield to warrant the investment into a stable of artists for a direct-to-consumer distribution model. Instead, music firms will become production houses that work to populate broader media channels that own stronger control.

Get In Groove, Sammy G

All of this speculation is based on the idea that downloading is directly responsible for a decline in CD sales. The RIAA and similar groups such as “The International Federation of the Phonographic Industry (IFPI) blame unauthorized downloads from online networks like Kazaa and Morpheus for a 20% drop in CD sales over three years” (Anonymous, USA Today). Is the downloading phenomenon actually responsible for that kind of monetary loss?

Experts say no. “Harvard and the University of North Carolina-Chapel Hill issued a joint report saying that unauthorized downloaders had a “limited effect” on CD sales” (Anonymous, USA Today). Extreme Tech Journalist Dave Salvator expounded further on the study: “While downloads occur on a vast scale,” the study’s authors conclude, “most users are likely individuals who would not have bought the album even in the absence of file- sharing.” The study goes on to say “…it would take 5,000 downloads to reduce the sales of an album by one copy….After annualizing, this would imply a yearly sales loss of two million albums, which is virtually a rounding error.” One could also reasonably infer that since most file sharers would not have bought the album they’re downloading if file sharing didn’t exist, it’s quite plausible that those very users liked the album they downloaded well enough to actually buy a CD they would not have otherwise bought. (Salvator)

In 2002, Jupiter Research analyst Aram Sinnreich found in another study “that people who traded files for more than six months were 75 percent more likely than average online music fans to spend more money on music” (McGuire). Boycott-RIAA noted that the case could be made “in cold, hard numbers that the RIAA’s claim of digital piracy ravaging their sales must be taken with a rather large grain of salt” (Moore). They point out that the RIAA is down 11.94% in a market in which “the Dow Jones Industrial Average (DJIA) has dropped over twenty percent in the last two-and-a-half years; the NASDAQ has lost over seventy percent of its value”(Moore). Indeed, a Reuters article on CNN.com noted “poor economic conditions and competition from video games and DVDs” as further contributing factors to RIAA monetary woes.

The evidence seems to suggest that the music industry is faltering along with the economy, and the RIAA places the blame for this squarely on the backs of music downloaders. This is simply not true. A study conducted in January of 2004 shows “album sales were up 9.2 percent. Sales of CDs rose 10.6 percent(and) the numbers of 2003 were down about 10 percent to 12 percent from the year before” (Viega, 19, Apr.). What is interesting is a trend that shows that the number of people engaging in file sharing is “down 41 percent from its peak of 34 million in June(2003)(but has) swelled (again) to 23 million, an increase of 28 percent since the last survey in December” (Chmielewski). If the RIAA had a 10 percent loss as downloads declined, and has reported a 10.6 percent gain this quarter, as downloads have increased 28 percent, it would seem to indicate that downloads are not hurting retail music sales.

If downloading music does not hurt artists, consumers, or record companies, and if music retailers are being phased out in favor of alternative CD markets, which are thriving, I find it hard to accept the notion that it is “Wrong” to download music. This is not piracy. This is not stealing. Consumers get more choices and lower prices. Artists get greater concert turnout. Record companies are able to offset declining profits by offering paid services, and there is evidence to suggest that downloading actually helps album sales.

When rounding out my research, I found a list of solutions to the downloading problem that would be good for the consumer as well as the record companies. There are also non-litigious deterrents such as Macrovision encoding (Finn) and high quality DVD audio, that have actually seen profits rise as record companies scramble to deter people from downloading music.

In researching this topic, I found that the insipid twisting of facts by the RIAA is enough to make me upset at the entire industry. One comes to the entertainment industry as a whole with a degree of trepidation, but I never expected to find the practices I did. I was shocked to see the price fixing, the lack of data backing the industry’s position on artists, the blatant lies on the RIAA website about how the consumer is hurt.. all of it.

As for my position, I believe more strongly now than ever that the recording industry in its quest for profit has acted insidiously to undermine peer-to-peer file sharing, not out of a sense of being stolen from, but out of a need to control the material, make an excuse for lack of quality product, and squeeze profit from other industries by acting in bad faith. I believe it can be confirmed that file sharing, the involved technology, and the possibility for exposure on the internet can be a boon to non top-ten acts, and a miracle for small bands like Wilco. Finally I believe that the actions of the RIAA in congress and in civil court are inappropriate and unwarranted, where I once I thought they were just being too tenacious. I have seen a very shady industry for what it really is in researching this paper, and I hope that when it is finished, my readers will too. SOURCES: Ahrens, Frank. “Music fans find online jukebox half empty.” Washington Post 19 Jan. 2004.: A1+ Anonymous “Charges of song swapping go global.” USA Today 31, Mar. 2004.: Money 4b Tompkins, Al “Thursday Edition: Sky high ticket prices”. Poynter Online. 31, April 2004. (http://www.poynter.org/column.asp?id=2&aid=63338) McGuire, David. “Study: File-Sharing No Threat to Music Sales” Washington Post.Com 29, March, 2004 (http://www.washingtonpost.com/wp-dyn/articles/A34300-2004Mar29.html) Salvator, Dave. “RIAA hit from two sides.” Extreme Tech: Yahoo! News 8, Apr. 2004. (http://news.yahoo.com/news?tmpl=story&cid=1738&u=/zd/20040409/tc_zd/123900&printer=1) Viega, Alex. “Universal to raise price of CDs by one dollar” Yahoo! News 16, Apr. 2004. (http://news.yahoo.com/news?tmpl=story&u=/ap/20040416/ap_en_bu/universal_music_cds_1) Viega, Alex. “US Music sales increase in first quarter of 2004” Houston Chronicle Online 19, Apr. 2004 (http://www.chron.com/cs/CDA/ssistory.mpl/ae/2503136) Taylor, Chris. “Where the money goes: A breakdown of the 19.95” I wrote the book. Date unknown. (http://www.sandersontaylor.com/book/CTmoney.html) Anonymous. “Press release: Record Companies Settle FTC Charges of Restraining Competition in CD Music Market” Federal Trade Commission. 10, May 2000. (http://www.ftc.gov/opa/2000/05/cdpres.htm) RIAA Online Newsletter. 30 Mar. 2004. Recording Industry Association of America. 22, Apr. 2004 (http://www.riaa.com/news/newsletter/033004.asp)

Boycott RIAA. 2003. Boycott-Riaa.com: Taking a Stand against the Recording Industry Association of America. 23, Apr. 2004 (http://www.boycott-riaa.com/)

Anonymous. “What the RIAA is doing about Piracy” RIAA.Com 21, Apr. 2004 (http://www.riaa.com/issues/piracy/riaa.asp) Bell, Mike. “Everything Barenaked” Calgary Sun Online. 27, March 2004. (http://www.calgarysun.com/cgi-bin/niveau2.cgi?s=arts&p=82955.html&a=1) Flynn, Laurie. “Sales Abroad Help Amazon Post a Profit in 1st Quarter” New York Times. 23, April 2004. (http://www.calgarysun.com/cgi-bin/niveau2.cgi?s=arts&p=82955.html&a=1) Ryan, Maureen. “Copy Fight: Two veterans of the internet wars debate the raging battle over who should control our entertainment.” Chicago Tribune 28, Mar. 2004 (http://www.latimes.com/business/chi-0403280175mar28,1,7367285.story) Chmielewski, Dawn. “Music downloads on the rise again.” Mercury News 26, Apr. 2004 (http://www.latimes.com/business/chi-0403280175mar28,1,7367285.story) Finn, Bridget. “Coming Soon: The Untouchable CD.” Business 2.0 Sep. 2003, Vol. 4, Issue 8 Accessed from EBSCO Host 19 Apr. 2004 Boehlert, Eric. “Suit: Clear channel is an illegal monopoly” Salon.com. 8, Aug 2001. (http://archive.salon.com/ent/clear_channel/2001/08/08/antitrust/print.html) Moore, Justin. “RIAA vs. the economy.” Boycott-RIAA.com 2002. (http://www.boycott-riaa.com/education/analysis)

Other Websites used: www.timpane.com www.amazon.com www.wherehouse.com www.towerrecords.com www.walmart.com

Is it wrong to download – Part 3: The Victimless by Timpane With so many reasons to make people file-share, is there a good reason not to?”

The answer: only if there is compelling ethical or moral reason not to file share.

I began my research by going straight to the source, the website of the RIAA, www.riaa.com, which had this to say.

“(Music downloading) is illegal, unethical, and all too frequent in today’s digital age. That is why RIAA continues to fight music piracy. Many do not understand the significant negative impact of piracy on the music industry, depriving not only the record company of profits, but also the artist, producer, songwriter, publisher, retailer, and the list goes on. The consumer is the ultimate victim, as pirated product is generally poorly manufactured and does not include the superior sound quality, art work, and insert information included in legitimate product”

The main claims made by the RIAA seem to be these: 1) Music downloading hurts artists 2) Music downloading hurts consumers 3) Music downloading hurts retailers. 4) Music downloading hurts record companies, who are faltering as a result

I set out to discover if these claims were true. I began my search by seeking out articles that confirm or deny that downloading music hurts artists, which is the most morally compelling reason to forbid the actions of peer-to-peer downloading. Being that I had the RIAA’s opinion, I went to their opposition first.

Boycott-RIAA had this to say about artists and file sharing: “We (the founders of Boycott-RIAA) are very pro-artist. We are anti-exploitation of musicians, we are anti-loan shark business practices by the industry labels, but we are definitely ANTI-RIAA. The issue is NOT so much Copyright but CONTROL of distribution. The industry doesn’t want more music available but less. (unless it’s on their label). (http://www.boycott-riaa.com/artists)”

Chris Taylor of Sanderson Taylor Entertainment Lawyers breaks down what the artist belonging to the Major labels gets paid $1.31 per twenty-dollar CD. (Taylor) Therefore, if one were to look at a moderately selling CD such as Barenaked Ladies’ “Everything to Everyone”, which debuted in the top 10, but only sold 300,000 copies (Bell), and were to factor in the 20% loss in CD sales reported by the RIAA, that would mean that the band itself lost $78,600 in CD sales. This is assuming that downloading is to blame for 100% of music sales drops, and that the RIAA figure is correct.

Even so, concert ticket sales (based on prices, not attendance) have jumped “8% over the previous year” (Tompkins). “All but the very biggest pop acts make most of their money off concerts, not CD sales” (Boehlert). If this is the case, with average ticket prices of 52 dollars, (and Barenaked Ladies tickets selling at Ticketmaster for 25-50 dollars,) it would only take a slight percentage of swelling in concert sales either by 1% of each show or one dollar per ticket for one tour to offset the loss of sales represented by downloading even by the industry’s most pessimistic estimates.

Anecdotally, my first copy of a Barenaked Ladies’ album was a taped copy, and I gave many copies of that copy to people who then became fans. Years later, I myself have attended numerous concerts by the band, and have seen people at said concerts to whom I had given copies of that one original tape. All of this spawning from one unathorized copy. At the time of this writing, there were over 2000 Barenaked ladies MP3s being shared on Kazaa, most of them from the band’s back catalog. It seems undeniable that this sort of exposure could raise concert attendance or ticket prices by well more than 1%.

What I could not find was any clear evidence that the artists themselves were being hurt, outside of speculation by some artists with unsuccessful albums using downloading as an excuse for poor album sales, or incredibly successful artists (such as Eminem and Metallica) who are selling in such high amounts that their CD sales outweigh their concert tours. These bands make up less than 10% of the market. There has been outcry on both sides of the issue, with the independent artist claiming that the peer-to-peer phenomenon is just a leveling of the playing field.

Law professor Lawrence Lessig has said: “Now the point is, (The RIAAs) old business model wasn’t better for the artists and it wasn’t better for consumers, it was better for big record companies. When people talk about alternatives to that model, serious people are not talking about alternatives that make artists worse off and they’re not talking about alternatives that would make consumers worse off, they’re talking about alternatives that might make five companies worse off” (Ryan).

Record producer Ken Waagner cites that a band called Wilco, whom he represents, has actually seen audience size and CD sales surge since they began offering free copies of their music online. (Ryan)

So, if downloading doesn’t hurt the artists, this brings us to the RIAAs claim that file-sharing hurts consumers. As a frequent purchaser of CDs, this is an issue I took to heart.

It is in this claim that the RIAA’s claims are the most egregious. The RIAA cites only two ways music downloading hurts consumers: Inferior sound quality, and driving up prices. On one page of their website regarding the subscription services for downloading music online, the RIAA says: “The possibilities are great for the music industry: fans, artists, and record companies alike”. (http://www.riaa.com/issues/music/default.asp) . On another page, the RIAA says “The artists also depend on their reputations, which are damaged by the inferior quality of pirated copies” (http://www.riaa.com/issues/piracy/default.asp). These arguments seem to be at odds with one another, as the sound quality of the files in question (most in mp3 format with 128 to 160 bitrates) in both paid and peer-to-peer services is 99% of the time exactly the same. The RIAA website also states: “Consumers also lose because the shortcut savings enjoyed by pirates drive up the costs of legitimate product for everyone.” (http://www.riaa.com/issues/piracy/default.asp)This statement is entirely untrue. Although there has been a recent nominal upswing in prices, the recording industry’s most powerful member, Universal Music group “reduced its suggested retail price from $18.98 to $12.98 just three months (ago) stimulating sales that had been down for three years” (Viega, 16, April 2004).

The RIAA has stated that music quality and increased CD prices are the two ways downloading hurts the consumer. If downloading MP3s by subscription is not a problem with the and CD prices have fallen (after their initial spike due to price fixing) as downloading has gone up, then both of the RIAA’s arguments regarding damage done to the consumer are voided.

I decided to not spend too much time on whether or not retailers are being hit by the decline in CD sales. The fact is, the traditional music outlet charges more than the larger multi faceted chains like Wal-Mart. (Compare the price of the aforementioned “Everything to Everyone” album at 15.99 at Tower Records, 15.49 at Wherehouse, and 13.42 at Wal-Mart).

The truth is, the day of the “Record Store” may indeed be fading into the past. With chains like Wal-Mart showing 53 billion in profit (Moore), and offering paid music downloads to boot, and online stores such as Amazon.com boasting record sales, the argument that record stores are losing money because of music downloading is shaky.

This brought me to the big question, on which all the other questions hinged.

Does file sharing affect the bottom line of the record industry?

I just finished reading this incredible book called “When The Music Stopped” by Bernie Woods. The book is basically his memoirs of the big band era during his stint as the music editor of Variety. Although the book was written in the early 1990’s, you can practically feel yourself sitting in the front row of the Hotel Astoria listening to Tommy Dorsey’s Orchestra playing the 1940’s sound.

Anyway, another one of Woods’ chief motives in writing the book is to espouse his disgust at the deterioration of musical talent, chiefly blaming rock and roll.

At the start of the book, you get that “why don’t you shut up and stop whining old-timer” feeling. But his point hits home for me because I think some of this is true. I think it lends credence to the argument that recorded music product quality is falling while other forms of entertainment are improving.

Anyway, the book was great because it looked at an era of music from almost 70 years ago, a time when every facet of the production and performance was broken up amongst varied outstanding professionals.

Still trying to find a similar book about Opera somewhere…

For those who have seen the horrible picture of me in my graduation gown, it is official. I didn’t attend what would have been my graduation day yesterday. I would have been one of 196 graduates of Columba Union College. I have never been a person who has patted themselves on the back but I am putting this out there for anyone who has even thought about going back. If you think it, do it. There is nothing that should hold you back.

On a personal note, at the beginning I worked two jobs to make ends meet (at the time I was going through a divorce), going to school, and a full time mother of a beautiful little girl. If it wasn’t for her and my mother, I probably would never have made it through. Now I can look back and say that I did it. Not only did I do it, but I graduated with honors. Something that was difficult for me to do with everything else I had going on. Genna was my backbone and my cheerleader. If she saw me watching tv or doing the dishes, whe would ask me if I had finished my homework. If the answer was no, she would make me stop..march me upstairs and explain to me that homework was very important if I wanted to get all O’s (for those without kids, O are the same as getting an A).

Thank you Genna for being there for me when the going got tough!!!

In preparation for an upgrade to the latest version of Drupal (my weblogging software), I’ve disabled my fancy-pants theme for something simpler while doing it. Don’t worry, my color-laden page will be back soon!

Going into my research paper, I believed I would find ample proof that the RIAA should not continue its present course of legal action against people involved in file sharing.

PART 2

I was appalled at what I found. Going into the research, I was expecting to find that CDs were overpriced because of the exorbitant sum paid to big-name musicians, and that the market had to reflect that fact. I also expected to find that CDs had increased in price as a result of the increases of cost of living.

The music industry would have you believe that costs for creating a CD have endured “a 41% price increase in 5 years” (Boycott-RIAA). The fact is, the music companies pay about $7.50 to create a CD, including money paid to bands, producers, distributors, and songwriters. They then sell the CD to a retailer for a 30% profit, and the retailer sells it for an additional 30% profit. The record company uses their 30% profit to pay for “all the record company’s operations including, staff, severance packages, expensive building leases/rent, computers, cars, sushi lunches, flights, conferences in Hawaii, cell phones, etc.” (Taylor)

There was a time, leading up to 1996 when competition between music retailers had CDs selling for $9.99, delivering a smaller kickback to the music companies. At that point, the five companies that make up the bulk of the Recording Industry Association of America, or RIAA, “modified their existing cooperative advertising programs to induce retailers into charging consumers higher prices for CDs, allowing the distributors to raise their own prices” (Anonymous – FTC). In 2002, the FTC found the RIAA, which controls 85% of all music purchased on CD guilty on monopoly charges, citing that their price fixing over three years caused “U.S. consumers (to pay) as much as $480 million more than they should have for CDs and other music” (Anonymous – FTC). Since the price fixing to stop CDs from selling at $9.99, the market has never dipped below the ten-dollar mark for individual CD purchases. Many would have you believe that that is simply a reflection of inflation, but it is interesting to note that DVDs, VHS cassettes, CD-Rs, CD Recorders, and CD players have all dropped significantly in price since 1996, with the Retail music CD being the exception. Although prices have fallen since downloading has provided an alternative, the average new release prices still range from $13.99 to $19.99.

When Napster first arrived on the scene offering downloadable music for free over the Internet, many consumers claimed to download because they didn’t want to have to buy entire albums for one or two songs they liked. Flash forward to today, and the recording industry would have you look at the new pay-per-download version of Napster, which charges 99 cents per song as the solution. The problem isn’t solved, however. “They will find that top-selling acts Madonna and Red Hot Chili Peppers sell their songs by the album, but not as singles. They will find some musicians on one service, but not on others”, they will not find The Beatles anywhere, and they will find all of this on a peer-to-peer network. (Ahrens) Finally, it is important to note that the record companies currently pocket 70% of profits from most online downloads, with artists getting only 10-15%, and all of this with the end user using bandwidth, time, and their own materials (CD-Rs for instance) in an attempt to get a better deal, and still failing to do so (Boycott-RIAA).

With all these factors in place, it is easy to see how the general public began to look for another alternative. What they found was peer-to-peer file sharing. The only question was.. is there any reason not to?

This will be the first of a 4 part series I will be posting regarding downloading music through peer-to-peer file sharing. The 4 combined are part of an assignment I have been working on as part of my degree.

PART 1

Should the RIAA continue its present course of legal action against people involved in file sharing?

This is an issue that is important to me for a number of reasons, and I will outline them here. Millions of people do it each day, millions of songs are downloaded, and, as an artist, I welcome the idea.

I create music. On my website, www.timpane.com, I have posted a number of MP3s online for people to hear or download for free. It would be my fondest dream that one of these songs end up on Kazaa, being downloaded in the millions. I would have new people hear my music every day, and from there, I could build a fan base, to whom I could market CDs, and perform live shows. Instead, I work hard every day at a job, then record my music at my own expense, and make my own CDs to give away to whoever will listen.

The music industry and a number of artists have taken this fond wish and rejected it out of hand, saying it is just not good enough for them. They want more of something they already have.. profit.

I fully accept that it should be illegal for others to make money off of the work of the industry. I know that there are websites selling advertising space and giving away songs (called “warez”) royalty free to the public. This is an unacceptable practice, and I agree that it must be stopped. There is a phenomenon, however, of which I do approve. It is called file-sharing. This phenomenon involves a program on the internet that links two individual computers and lets them trade files between one another. This program connects millions of individual computers, and allows you to search through archives on each one. You find something you like.. go ahead, you can have a copy.

The Music industry has, after successfully shutting down websites that allowed people to download music, started to prosecute the end users of this file-sharing software, calling it “stealing” or “piracy”, and claiming it is affecting their sales. Their targets have been regular people like you and me, including students, teachers, grandfathers, and a twelve year old girl.

At the heart of this issue, there are two questions. 1) Are current paid music options viable or fair? 2) Is it wrong to download music from peers?

If the answer to those both those questions is yes, then we will take it as an axiom that peer-to-peer music downloading should be stopped, and that the RIAA has the right to prosecute those involved in that activity.

I will try to take a balanced approach regarding this issue. I will explore the websites of the RIAA as well as their opponents. I will look at the history of the issue as well as the situation as it stands today. I will use news articles, legal research papers, web pages, advocacy papers, and anecdotal information to see if my stance is correct.

Going into my research, I believe I will find ample proof that the RIAA should not continue its present course of legal action against people involved in file sharing.

TOMORROW: PART 2 – Are current options viable.