Wednesday, November 07, 2001

Lies, damn lies, and the RIAA. Hilary Rosen, RIAA boss, recently spoke at the O' Reilly Peer to Peer and Web Services Conference. Here are comments on her speech.

It is the songwriters' and the artists' and the producers and the record company' s job to create that music, bring it to life and to market, and it is RIAA' s job to protect it once it gets there.

It is not the producer or the record company's role in life to bring artists' music to the marketplace. The artist should be free to pick whichever channel suits him best, which may or may not be the recording industry. The RIAA's concerns are less about artists being rewarded and more about their role as gatekeepers to distribution channels. The abusive licensing practices they're cooking up through PressPlay and Duet, as well as codec licensing policies make that pretty clear.

The first is that, for new business models that take advantage of changing technology to flourish, we have to support a legitimate licensing structure. Why would artists and record companies continue to invest heart, soul and money into new digital opportunities when they have no hope of return for their effort?

All of the legislative effort by the RIAA has been against business models that threaten them. "Why would artists and record companies...invest in digital opportunities when they have no hope of return?" -- they have no need to, there are hundreds of techies and VCs willing to invest all the money that market needs. The recording industry does not need to be part of the online music investment community.

Some have argued for government intervention. I think that would be ill advised. The pace of the marketplace is too fast to accommodate such regulation. And who would want to dictate a "one-size fits all" business model? The proposals being circulated for legislative action would stifle innovation, competition and consumer choice.

This is rich coming from a group that practically wrote the DMCA and SSSCA. The truth of the matter is that the RIAA will lobby to extend its own power.

Technology development and innovation might not have been left to the consumer electronics and IT industries as it was by the recording industry in the 80's, leaving our companies less than fully operational on that level when the wave of new opportunities hit again in the early 90's.

And here you have it. The recording industry hates the interactivity and ability to share that techies built during the 80s and 90s. This is about control.

The problem with peer to peer is not the technology, but how it is used.

And companies are free to prosecute law breakers under existing laws. Software has dealt with this problem for decades. Piracy was always a cost (like taxes) for the recording industry, and now that cost has increased. It might have increased so much that that way of business is no longer profitable, just as making shoes by hand is no longer feasible. But different business models with different cost structures should be allowed to compete in the marketplace. Society does not need to serve the recording industry. Here are old articles I wrote on this topic:

Business model competition7/12/01: Napster court decision restricts competition between business models based on information sharing and information control.

Clue to publishers: you're selling experiences, not content7/27/01: Argues that publishers are unprepared for the business consequences of digital data because they remain fixated on selling content, instead of realizing that they should be selling experiences.


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