RIAA, MPAA In Denial About The Death Of DRM

from the good-luck-with-that dept

Thu, May 8th 2008 2:18pm — Mike Masnick

As a bunch of you are submitting, at a panel discussion down in LA, an RIAA representative claimed not only was DRM not dead, but that it was making a comeback. However, the statements show a fundamental misunderstanding of what's happening in the marketplace. RIAA technology guy David Hughes made this statement:

"I made a list of the 22 ways to sell music, and 20 of them still require DRM."

Well, David, I just made a list of 22 ways to sell transportation mechanisms, and 20 of them still require a buggy whip -- but it doesn't mean anyone will buy them. Then, even worse was the statement from the MPAA's Fritz Attaway:

"We need DRM to show our customers the limits of the license they have entered into with us."

Well, there's your problem Fritz. The second you focus on how to limit your customers, you've lost them. No one wants to be limited these days. They want to be able to do what they want and they will reward those who allow them to do so. Treating your customers as people to be limited (i.e., people who you offer less value to) pretty much guarantees that they'll go elsewhere.

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Filed Under: david hughes, denial, drm, fritz attaway, mpaa, riaa
Companies: mpaa, riaa

44 Comments

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some old guy, 8 May 2008 @ 2:28pm

tpb
When you add drm to your product, you are making the pirated copies more valuable than your own. Assuming consumer morals are irrelevant, why would a consumer spend more money to get an inferior product?

Now, why is consumer morality irrelevant? Because, the corporate morality is long since gone. Consumers have stopped caring about the corporations, as they are tired of being subjected to the corporations immoralities.

Making your product less valuable than the alternative is just not a good idea.

If RIAA(/MPAA) want to complain about lost sales, then they need to point the finger at their own decisions. Adding DRM to iTMS reduces sales. They could sell far more music through iTMS if they would give apple the license to sell without DRM. Giving this right to Amazon to spite Apple, and then complaining about lost sales is just utterly stupid.
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JJ, 8 May 2008 @ 2:36pm

Why is it that these people still have jobs? Not just the people above who made the idiot comments, but the RIAA as a whole. Technology is so advance these days that you can setup a professional recording studio in your basement for about 10k - 20k and contract out the production and distribution of the CDs for pennies on the dollar. Tell me why they still need an organization *caugh*PIMP*caugh* such as the RIAA to get their music out? I'm not saying this is the perfect situation for every individual artist, but you would think that competition would spawn a whole bunch of little organizations like these that would produce and distribute CDs as a service. Someone needs to sue the RIAA Microsoft style for supressing competition.
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Beefcake, 8 May 2008 @ 2:38pm

Retort
The customer base needs piracy to show the MPAA the limits of revenue they'll see when they force us to enter a license agreement just to watch a damn movie.
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GeneralEmergency (profile), 8 May 2008 @ 2:49pm

Ummmm...
...what Mike said! But double!

Jeeez....These people **are** dumber than a bag of hammers.

Well, what with that substitute teacher being fired in Florida yesterday after being accused of, get this..."Wizardry", I suppose there must be something in the water these days that is actually making people stupid.

Uhhh...Ohhh... Am I becomming stupid too?

How do I know if I've become stupid?

Why don't I know how to tell if I've become stupid??

OH DAMN. I'm getting STUPID too!
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Maura Corbett, 8 May 2008 @ 2:52pm

RIAA and MPAA Now Appearing at Digital Hollywood as Monty Python's The Black Knight
Yet again, we are left scratching our heads at the big content companies. Much like the Black Knight’s protestations to King Arthur that “none shall pass!” in Monty Python and the Holy Grail, the RIAA seems to believe that despite having no arms and no legs, digital rights management (DRM) is supposedly poised for a comeback. Equally disturbing were comments by the Motion Picture Association of America’s (MPAA) Fritz Attaway that the MPAA intends to wield DRM as a weapon to threaten consumers about their lack of rights.

In a panel discussion at the Digital Hollywood conference, the content world established that it still lives in a completely different world than its customers. While the rest of the marketplace continues to successfully move towards business models for the digital age, David Hughes, who according to CNET heads up RIAA’s technology unit, effectively ridiculed the progress that international music labels – and RIAA member companies – EMI, Sony BMG and the Universal Music Group, and major retailers Amazon.com and Wal-Mart have made by readily making DRM-free music available to consumers. The MPAA seemed more concerned with limiting its customers’ rights than actually doing business with them.

Meanwhile, back on earth, the rest of us have already figured out that digital freedoms equal digital profitability. Giving consumers what they want – digital music – the way they want it – without burdensome DRM (digital rights management) software that locks them up – pays dividends to all stakeholders in the digital world – including the content industry.

The Digital Freedom Campaign is compelled to remind these big content companies that consumers have also rights in the digital age, and those rights include the ability to enjoy the content they legally purchase. Content and consumer rights are not a zero sum game.

DRM has suffered far more than a flesh wound, and we’ve all crossed the bridge into the digital age. Hey content companies – wake up!
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PaulT (profile), 8 May 2008 @ 3:07pm

Sales?
I've said it before and I'll say it again - if you want me to ignore your product, DRM is the quickest way to do so. I buy almost exclusively from Beatport and eMusic because there's no DRM. I have ignored all movie download services so far because of DRM. I refuse to buy Blu-Ray until the DRM is cracked properly.

Why? Not because I want to copy the content, but because I want to enjoy it. The point of DRM is to restrict me, I don't appreciate that. the day I can buy movies and music from the major corporations without regional and/or usage restrictions at a reasonable price is the day I start doing so.
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Avatar28, 8 May 2008 @ 3:21pm

drm = no sale
I think I have bought a grand total of TWO songs (via Rhapsody) that had DRM. On the other hand, with the coming of the Amazon MP3 store I have bought quite a few songs in MP3 format. Of course, there are still some labels and artists that refuse to sell their music like that. For them I have two words... Bit Torrent. Seriously. I would gladly buy a song I like if it is an MP3 I can do with as a I please. For those that don't, well, there are other methods, bit torrent, usenet, friends to borrow the disc from and the used CD store down the road. In any of those cases, the only way the RIAA is going to see any money from me is when I can do what I want with the music that *I* paid for with my hard-earned money.
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Kendra L., 8 May 2008 @ 3:28pm

If You're Going To Steal Software, Steal From Us...
...were the comments from a Microsoft Exec. The president of Microsoft business group estimates that between 20% and 25% of all software used in the United States is pirated, but said pirates end up becoming paying customers.

I have no idea how they got there, but it's not tough to imagine early on, the team took a gamble that paid off, similar to what we did.

Myself, I'm in the business of making delicious cakes, and my business started when my main oven didn't heat evenly and full-sized, sheet cake came out 20-25% burnt. My head baker looked at the problem carefully. Unwilling to change the recipe (it won awards), the head baker researched, researched and researched. After several days, she realized the oven was to blame. It was responsible for burning the cake.

We worked together and turned the problem into an opportunity by building smaller versions of the cake (now frequently known as "Coffee Cakes") that were smaller and didn't get burned when going through the main oven.

We learned that the smaller bakeries, like my business, wanted to make sheet-sized cake themselves, but didn't want to segment into a business of making these smaller cakes. With my great Sales team, CakeCo, worked with cafeterias at schools, colleges, and select retail locations. "If I made Coffee Cakes, They would go stale" was a common complaint.

So with my blessing, my Head Baker, equipped with an 80% working oven, decided to start focusing on the untapped Coffee Cake market, and started selling them to college-age crowd thru the many storefronts who didn't want to get into the Coffee Cake business themselves. The target demographic (students) started buying the single-sized cake (complete with award winning butter-based icing) at a price they could afford. The gamble started paying of on multiple levels. In fact, upon graduation, the Full-sized Cake- Office CoffeeCake Extranet Global Economy Edition, enjoyed great market share, as well as great brand recognition, partially due to how I took care of my customers in College.

Yes, burned cake has multiple causes. If 20% of the cake is burned, make it smaller. Knowing or understanding needs of customers, is critical to get to the end goal. If it's not available, then it's a missed opportunity and everyone looses.

Besides, anyone can make and sell cake these days and put it on CakeTube, but your cake needs to be #1 before Duncan Heinz starts selling "At Home" boxed kits!
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ehrichweiss, 8 May 2008 @ 3:28pm

Re: tpb
Yup. My first encounter with DRM was when I bought my first game, BattleChess, and had brought my computer(an Amiga 500) into work with me to play with it during the downtime and I forgot the damn manual. Well it obviously asked me for the code from the manual and I couldn't play it that night. The next day I got online(not easy to do in 1993) and found someone who had a cracked copy of the game and never had that problem again. I also never purchased software from Interplay again. So they got my $50 from the game back then but haven't made a penny from me since then. I wonder if they think it was worth it.
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SUPER SMASH GRAMMAR, 8 May 2008 @ 3:43pm

PEOPLE TO WHOM YOU OFFER LESS VALUE AHHHHHHHHHHHH
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Eeqmcsq, 8 May 2008 @ 4:00pm

Best line of this post
"The second you focus on how to limit your customers, you've lost them."

This sums up a lot of tech issues that I read about: DRM, invisible ISP download caps, Windows Genuine Advantage, etc. In some cases, it's hard to go elsewhere, such as switching away from Windows, or there's nowhere else to go, such as a Comcast local monopoly. But in other cases such as music, the switch is extremely easy, and unless you take care of them, they're gone in a flash.
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Bill, 8 May 2008 @ 5:12pm

RIAA and MPAA must be idiots
The RIAA and MPAA must be idiots. I can't come up with any other explanation.

They punish their paying customers with insane DRM schemes while pirates get to enjoy DRM free music. That is exactly what happens. Believing otherwise is total stupidity.

Also, they say they are losing huge amounts of income to piracy, but they have yet to prove that those pirates would have bought the content if they didn't pirate it. How can it be "lost" income if it was never going to be income to begin with? You can only lose it if you actually had it. From what I've seen the pirates are mostly kids who can't afford to buy the crap anyway.

Meanwhile they punish and anger people like me, who bought literally thousands of dollars of their content, to the point where I have boycotted their products for years now.

To the RIAA (and MPAA):
1. Why do you hate me so much that you feel compelled to constantly lobby for my consumer rights to be even more restricted?
2. Why do you feel like you absolutely MUST control how and when I play the media I purchased from you? All I want is to be allowed to play the media I purchase on devices I own without feeling or being treated like a criminal. Why is that so difficult to understand? Why is it too much to ask?

Sure, go find the people who are duplicating and selling your work, but holy crap people, leave your paying customers alone, will you? We're all sick of it.
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Eeqmcsq, 8 May 2008 @ 5:51pm

Re: RIAA and MPAA must be idiots
1. They don't care about you. They're lobbying for more restrictions so they can get a bigger bottom line.
2. They're used to having control for years. It is the only technique they know. Thus, they don't care if they treat you like a criminal. Or conversely, they've never had to learn how to treat their customers right.
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Franssu, 8 May 2008 @ 6:09pm

Re: RIAA and MPAA Now Appearing at Digital Hollywood as Monty Python's The Black Knight
I nearly LOL'd during the second paragraph. Which would have been bad, as I'm in school.
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jrod, 8 May 2008 @ 6:56pm

Re: tpb
Your first, third and fourth paragraphs are good. Lose the corporate vs. consumer morality rant.
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Scorpiaux, 8 May 2008 @ 7:47pm

Money for nothin'. Chicks for free.
"The second you focus on how to limit your customers, you've lost them. No one wants to be limited these days. They want to be able to do what they want and they will reward those who allow them to do so. Treating your customers as people to be limited (i.e., people who you offer less value to) pretty much guarantees that they'll go elsewhere."

Overblown analogies can be found all over this web site. Mostly from the like-minded majority posting here.

Seems to me that many contracts in the retail marketplace are full of limitations (Tax, tag, title not included.) Insurance companies limit their exposure and your benefits. There are speed limits on the highways. How about "Limit two per customer" in the grocery store on a two-for-the-cost-of-one can of peas? Laws get passed all the time with limits of some kind built into them. What is so special about music that says that makes you believe that you can do with it what you will without limitations?

Why don't you advocates for free music advocate free operating systems, free office software, free books, free gas for your car, mortgage-free homes? I mean, free is the new business model, right?
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Scorpiaux, 8 May 2008 @ 7:52pm

Re: Anyone can do it better than those who have done it
"Technology is so advance these days that you can setup a professional recording studio in your basement for about 10k - 20k and contract out the production and distribution of the CDs for pennies on the dollar." - JJ

Then why don't you do just that?
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Anonymous Coward, 8 May 2008 @ 9:26pm

If you are licensing DVDs, why are they always advertised as "Own it today!"?
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mobiGeek, 8 May 2008 @ 9:29pm

Re: Money for nothin'. Chicks for free.
Seems to me that many contracts in the retail marketplace are full of limitations (Tax, tag, title not included.)

Seems to me you are pointing out a weakness in the retail marketplace, waiting for a new competitor to enter that removes these limitations and empowers their customers. Those that empower their customers (and can demonstrate the benefits of that power) will dominate. Unfortunately, the masses currently are of the mindset that low-price-beats-all-other-benefits. That will change.

Why don't you advocates for free music advocate free operating systems, free office software, free books, free gas for your car, mortgage-free homes?

For someone who posts that they've real "all over this website", you seem to have missed some pretty critical basic points.
We aren't advocating "free" anything, we are simply pointing out economic realities: supply and demand. When an item costs nothing to reproduce (i.e. its marginal cost is effectively zero), then its price tends towards that cost. This is a market reality.
Free music, free software....this site discusses these things in great detail.
Free gas, free homes? This doesn't make any sense. There are hard costs to the fabrication/reproduction of these items, they are a scare resource, so their price will tend to the actual cost of production plus the premium fetched by the demand of this scarcity (i.e. it cost me $100000 to build the house, but 5 people want it so I can keep raising the price to the point where just 1 person wants it).
I don't buy the phrase "No one wants to be limited these days" in this article. Personally I think that no one ever wanted to be limited ever, but that people have accepted limits in order to have other benefits (e.g. lower price, immediate availability, etc...). Eventually our society will come about to realize that stuff is nothing but stuff, and then the focus will be on quality rather than quantity. Personally I've stopped purchasing from stores/companies where I've found limitations to be unreasonable (sales pressures, bogus warranties, fake "lowest price comparison" offers where they simply tweak a model num, etc...), but I currently do put up with some inconveniences (e.g. crowds, longer wait times) if a store/company services me well in the long run.
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mobiGeek, 8 May 2008 @ 9:33pm

Re: Re: RIAA and MPAA must be idiots
3. People keep coming back (and paying) for more crappy treatment (and IMO, crappier products).
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Daniel, 8 May 2008 @ 9:35pm

I put up with DRM on Ruckus for only two reasons. It's free music, and it's an easy crack.
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mobiGeek, 8 May 2008 @ 9:35pm

Re:
Depends on who gets to define what "own" means.
On the flip side, if people are just licensing DVDs....why do they keep buying/licensing them (bad usability and all)?
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PaulT (profile), 9 May 2008 @ 12:08am

Re: Money for nothin'. Chicks for free.
"Seems to me that many contracts in the retail marketplace are full of limitations"

This is a case where the contract is being changed to our detriment. If I buy a CD, I can rip and copy it, lend it to friends, play it in any CD player and then resell it if I want. DRM is a way of removing all of the above rights, at no discount. I object to that, for pretty obvious reasons.

"Why don't you advocates for free music advocate free operating systems, free office software, free books, free gas for your car, mortgage-free homes?"

As I type this on my Linux system, which has OpenOffice installed and access to gutenberg.org, all I need is a way of getting free gas and a free home, and I'm set!

To state the obvious - this is NOT about "free as in beer". Most of us are still willing to pay for music, we just don't want to pay for the incredibly restrictive trash that's being offered in the above statements.
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mike allen, 9 May 2008 @ 12:25am

Re: Re: tpb
why should mike drop the company V consumer bit it is company V consumer. and the customer is ALWAYS right!!!!!!
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Mike (profile), 9 May 2008 @ 3:22am

Re: Money for nothin'. Chicks for free.
Seems to me that many contracts in the retail marketplace are full of limitations

There's a difference. First of all, as others pointed out correctly in the comments, in this case it's about *increasing* limits (taking rights away from users). Second (again as others correctly pointed out), those limitations simply are opportunities for competitors. In the case of music, those competitors have already taken the opportunity.

But, most importantly, I didn't say limitations, by themselves, were the problem, but the fact that the industry seems to thinking that *focusing* on limitations is the way to create a new business model.

If the key selling point you have to offer is your limitation, you're dead.

Why don't you advocates for free music advocate free operating systems, free office software, free books, free gas for your car, mortgage-free homes? I mean, free is the new business model, right?

Hmm. Scorpiaux, I thought we went over the difference between scarce and infinite goods before. It's disappointing that you're making the same basic mistake all over again.

The "free" business model has never been about offering everything for free. It's about recognizing that by offering the infinite goods for free, you make money selling scarce goods. It's also about recognizing that if you don't do that, someone else will -- and then you'll be in real trouble.
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Dirk Belligerent, 9 May 2008 @ 5:41am

Who da man?
Did anyone else read this: ""We need DRM to show our customers the limits of the license they have entered into with us." and picture an abusive husband saying, "I need smack my bitch up to show my woman the limits of the relationship she has entered into with me."?
As EA is about to discover with their DRM fisting of Mass Effect and Spore, when you persist in treating your paying customers as if they are criminals, they may start to live down to your expectations.
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Anonymous Coward, 9 May 2008 @ 6:04am

Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
Why do musicians deal with these idiots ?
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mobiGeek, 9 May 2008 @ 6:34am

Re:
<repeat iterations=infinite>Why do people keep buying from these idiots?</repeat>
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mobiGeek, 9 May 2008 @ 6:36am

Re: Re: Re: tpb
He wasn't talking about Mike, but about some old guy's post above. He's correct that the second paragraph above is nothing more than an unsubstantiated rant that detracts entirely from the acceptability of his other statements.
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Anonymous Coward, 9 May 2008 @ 7:40am

Re: Re: Re: Re: tpb
I disagree. I have no loyalty to any corporation because they've given me plenty of reasons not to trust them. If corporations had more integrity I'd feel better about supporting them.
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SomeGuy, 9 May 2008 @ 7:42am

Re: Re: Anyone can do it better than those who have done it
Mostly because JJ has no musical talent. I don't see how that lessens his argument for people that do have such talent.
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Anonymous Coward, 9 May 2008 @ 7:44am

Re: Ummmm...
As long as you're still in doubt whether you're stupid or not, you're safe. When you decide you definitely are not stupid, then you're too far gone.
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Anonymous Coward, 9 May 2008 @ 9:06am

Re:
From an English 101 perspective I know you're right, but Mike's line was more natural and easier to understand.
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Anonymous Coward, 9 May 2008 @ 9:09am

Re: Re: RIAA and MPAA must be idiots
1. This is a flawed perspective. The tighter they close their grip the more customers they'll lose through their fingers. They'll end up with an increasingly large slice of an increasingly smaller pie.
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SomeGuy, 9 May 2008 @ 9:20am

Re: Money for nothin'. Chicks for free.
When I buy a car, I own the car and can do as I want with it. The Tax, title, and liscence are not included in the price of the car, but these are not limitations to my enjoyment of the purchaced product.

When I buy insurance I'm not purchacing a product, I'm negotiating service. My provider and I have contrasting interests and we must agree on a level of service which I'm willing to pay for and they are willing to provide. This is almost wholly different from purchacing a product and limiting the use of that product.

When I buy a CD or DVD or whatever that comes with DRM I have purchaced a product which limits the usefulness of that product with no advantage to me, the customer. I can't play it in my device of choice, for example. This reduces the value of the product. And if I can find a comprable product without DRM, that other product has more value to me.

Do you see the differences?
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Anonymous Coward, 9 May 2008 @ 9:23am

Re:
Because until now there was little alternative.
Because right now, the alternative looks like a harder problem.

Give it another year or two, as the RIAA continues to flounder and bands like NIN show everyone new ways to make money with music, fewer and fewer artists will be dealing with these idiots.
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marky, 9 May 2008 @ 11:08am

Preach it!
I love this website. It is so refreshing to see that I am not the only one who feels so strongly about these issues. I just wish that Congress would start listening to people instead of interest groups!
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Eeqmcsq, 9 May 2008 @ 1:18pm

Re: Re: Re: RIAA and MPAA must be idiots
Yes, it is. And WE understand that. THEY don't.
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Lloyd Kaufman, 9 May 2008 @ 2:32pm

RIAA/MPAA in denial....
The Media megaconglomerates have been spoiled by having created a cartel which has killed alot of competition in the entertainment industry...they have not had to exercise their collective brains because life has been too easy for them...hence the luddite obtuseness which you have discerned.Please see my recent essay in T.V.Week Magazine re:the issues you raise.
http://www.tvweek.com/news/2008/04/guest_commentary_lloyd_kaufman.php
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teknosapien, 9 May 2008 @ 4:22pm

Ive said it before and well
I dont buy Music any longer any artist that sides with the legion of darkness is a artist that I don't want to have anything to do with. So where do I get my Tunes? www.archive.org
Nuff said
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Jeff, 1 Dec 2008 @ 6:10pm

Re: Money for nothin'. Chicks for free.
"Why don't you advocates for free music advocate free operating systems, free office software, free books, free gas for your car, mortgage-free homes? I mean, free is the new business model, right?"

Free OS = Ubuntu
Free Office Software = Open Office
Free Books = Called the library
Free Gas for your car = (Well this doesn't exist yet but will in time)
Mortgage-free Homes = AKA Apartment

We do!
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Carl and I'm Pissed., 1 Dec 2008 @ 6:33pm

Let 'em rot.
I love how record companies are all bitchin' and moanin' about money loss when they have been ripping off artists (for their rights - see Tom Petty) and ripping of their customers at $18-$22 per CD, and before that Cassette Tape, and before that 8 Track, and before that Records, for DECADES. Now they have the nerve to cry unfair!

The RIAA can F*** off. Let them die. We don't need another bullshit, repetitive, stereotypical, pop wannabe, that plays on rotation every 30 mins on the radio. Little originality wouldn't hurt either, RIAA. Anyone here who is defending record companies, let them waste the money. They'll get a nice collection of CD's and when they run into Walmart to buy more someone will break into their car and steal all of them. But, because of DRM they won't have any backups. Awwwwwww... Call your insurance company, but wait there is a $500 deductable. Damn, what a waste.
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JJ, 19 Dec 2009 @ 1:37am

Re: Let 'em rot.
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me, 9 Jun 2011 @ 4:36am

Re: Money for nothin'. Chicks for free.
shut up
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