What The RIAA Efforts Have Really Been About: Controlling Channels

from the let's-get-real dept

Tue, Mar 3rd 2009 2:40pm — Mike Masnick

A few folks have been writing in about the latest in a long line of lawsuits against the RIAA, this one focusing on how its entire lawsuit strategy has been a legal sham. This particular lawsuit isn't really all that different than some of the previous lawsuits against the RIAA, and unfortunately, judges haven't been all that accommodating to such lawsuits, so I'm not really expecting it to go very far. However, within the lawsuit, there is a pretty good explanation of why the RIAA and the major record labels have been conducting this braindead, short-sighted and self-defeating legal campaign all along. It's had nothing to do with "educating the public" or "protecting artists' rights" as representatives have claimed in the past. No, it's all been about one single thing: protecting a monopoly on distribution and channel relationships.

In the old business model, the record labels made their money because they had near total control over the production of content, the distribution of content, and all channel relationships with retailers. The internet and new digital technologies broke all of that down. It made it easier for anyone to produce content, distribute content or even build channel relationships themselves. What the record labels got upset about wasn't "file sharing" per se -- but the fact that file sharing went around all of their channel relationships and effectively killed the one major scarcity they controlled.

So, don't believe the entertainment industry lawyers who laughably claim that the RIAA's legal maneuvering has nothing to do with business models. It's always been about business models. The lawsuits were just a way to try to stuff the genie back in the bottle, and prevent these alternative channels and means of distribution and promotion from seeing the light of day.

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Filed Under: business models, channels, lawsuits, music
Companies: riaa

18 Comments

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Anonymous Coward, 3 Mar 2009 @ 2:55pm

Doh!
You just now figured that out?

The middlemen see their cash cow slipping away, and flail about, in odd and self-destructive ways, to try to protect their income. After all, this system has worked well for them for quite a few years. They try to pass laws and press lawsuits to protect their quaint, antiquated business model. But what they never consider is how to adapt.
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Scott Atkinson, 3 Mar 2009 @ 3:02pm

It goes further than that...
I think the labels wanted to do more than prevent people from circumventing them; they wanted drm and lawsuits so they could put up toll booths everywhere.

You want Dark Side of the Moon at home? That's one sale. On your iPod? Another. A third copy for the car? Ka-ching!

Scott A.
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Anonymous Coward, 3 Mar 2009 @ 3:43pm

Legal sham?

Perhaps bad PR and/or being heavy handed, but hardly a legal sham. As for the excerpts from an Answer that includes a Counterclaim, I never realized that such an action is "significant". This is how pleadings work.

You many find a presentation at the ipcolloquium of interest. It explores the statutory damages issue raised in the Tenenbaum (sp?) case quite nicely and is certainly very informative as to the pros and cons.

To talk about business models is one thing, but to say these lawsuits are a sham is inaccurate.
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Anonymous Coward, 3 Mar 2009 @ 4:06pm

"To talk about business models is one thing, but to say these lawsuits are a sham is inaccurate."

True, the lawsuits are totally legit. Speaking for myself, however, the laws themselves are a total sham. They are bought and paid for by RIAA member corporations to fund political campaigns in exchange for laws which favor their archaic business model. We need campaign finance reform to clean up this and many other issues in our nation. Let the representatives represent their constituents, not their campaign financiers. In the system we have now, we elect the person who gets to sell their influence to the highest bidder.
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Mike (profile), 3 Mar 2009 @ 4:29pm

Re:
To talk about business models is one thing, but to say these lawsuits are a sham is inaccurate.

I stand by it. These lawsuits were never about doing anything good for the music industry. They were an attempt to protect an obsolete business model. To me, that's an absolute sham.

I know you have a different definition, but you've long been a supporter of troubling arguments for stronger IP, including the extremely troubling notion that an IP regime that makes everyone worse off is somehow a good thing. I find it difficult to take you seriously on these issues since you stated that view.
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hank mitchell, 3 Mar 2009 @ 5:08pm

hear it on FM radio, buy it at walmart
just like forcing webcasters out of business with absurd royalty rates to control what gets played over the "airwaves", they want to go back to "hear it on FM radio, buy it at walmart" -- fortunately popular culture is (slightly) smarter than that and will (eventually) figure it out. Ever wonder why PSPs, iphones, ipods, zens, etc that have built in wifi don't allow wireless file transfer to a similar device -- perhaps the most obvious and useful feature they could ever implement? It's not because the engineers did not think of it...
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Anonymous Coward, 3 Mar 2009 @ 8:18pm

Re: Re:
I know you have a different definition, but you've long been a supporter of troubling arguments for stronger IP, including the extremely troubling notion that an IP regime that makes everyone worse off is somehow a good thing. I find it difficult to take you seriously on these issues since you stated that view.

I would be troubled as well if I had actually made any of these arguments.
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Mike (profile), 3 Mar 2009 @ 10:23pm

Re: Re: Re:
I would be troubled as well if I had actually made any of these arguments.

You did exactly that. I asked you straight up whether or not you thought a scenario in which everyone was worse off could possibly be morally superior, and you answered yes:

http://www.techdirt.com/article.php?sid=20080604/0223551307#c790

At least back then you were willing to sign your name to things.
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Anonymous Coward, 4 Mar 2009 @ 12:53am

"....this braindead, short-sighted and self-defeating legal campaign..."

The Masnicks legal opinions get ever more eloquent and briliant !.
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Anonymous Coward, 4 Mar 2009 @ 12:55am

Re: Re: Re: Re:
Should we understand that anonymous comments on techdirt are actually not anonymous ?
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Anonymous Coward, 4 Mar 2009 @ 1:45am

Re: Re: Re: Re: Re:
Should we understand that anonymous comments on techdirt are actually not anonymous ?

This is the internet, nothing is anonymous...
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Mike (profile), 4 Mar 2009 @ 2:35am

Re:
The Masnicks legal opinions get ever more eloquent and briliant !.

It was, quite clearly to those who can read, a business opinion, not a legal one.
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Mike (profile), 4 Mar 2009 @ 2:37am

Re: Re: Re: Re: Re:
Should we understand that anonymous comments on techdirt are actually not anonymous ?

You have as much anonymity as you want. MLS has said that he is not trying to hide his identity, and that it is solely out of laziness that he has chosen not to post his name. And, even then we did not identify who he is.
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Anonymous Coward, 4 Mar 2009 @ 8:40am

Mr. Masnick,

Thank you for refreshing my recollection, though I do hew to the view that the article and long string of comments are important to place what I said is context.

Re your persistence in asserting the morality of making society less well off misses my point. No rational person in the business of selling things would argue that making less money is better than making more money. I would be a fool to argue otherwise.

Where we differ is how we respectively use the term "morality". Yours incorporates economic views that society being better off is the moral thing to do. My view is that people are fully withing their rights to act in a manner that is not in their best economic interest by exerting what may very well for them be less economically beneficial. Those who choose to do so are within their rights to place limitations on their workproduct, and persons who deliberately ignore those limitations are not acting in what I term a moral fashion.

Again, we each use the term "moral" in different ways. I well understand your use of the term and hope this helps you understand how I use the term.

I know I do not use persistent cookies and that seems to bother you. Perhaps if you were in my shoes where I have to suffer with BSODs (uisng Vista), and when I check my logs the cause is by and large http errors, you would better understand my reluctance. To this day I am ticked off that I can not install XP on my machine because of driver issues. I never experienced IE problems before. Of course, it took me several months working with XP before I got the system to work properly...but at least I learned how to avoid system errors. BTW, I know I can use alternate browsers, but do not want to do so because I have several programs I use constantly that integrate only into IE. Mine is clearly a catch-22 situation.
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me, 4 Mar 2009 @ 9:58am

The obvious anyone?
It's about controlling the production and distribution...
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Mike (profile), 4 Mar 2009 @ 12:14pm

Re:
I know I do not use persistent cookies and that seems to bother you

Not at all. It's not your use of persistent cookies. You could easily type "MLS" along with your posts. But you choose not to do so. You type paragraphs upon paragraphs, and you can't type 3 letters in a text field?
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Crosbie Fitch (profile), 5 Mar 2009 @ 2:52am

In agreement
Yes Mike, I think that's been recognised for some time by those who've been looking at the forest rather than the trees, but it's not a message that's particular easy to digest or package into a soundbite that's plainly relevant to the layman (who doesn't typically see any concern over distribution channels or who controls them).

Here's a couple of excerpts from my posts to Pho in 2004:

Sent: Friday, 6 February 2004 6:34pm
To: pho@onehouse.com
Subject: pho: RE: Trade group proposes new P2P music model

P2P systems may appear to be just a big, quasi-broadcasted melting pot of
play-on-demand content, but that's just their crude beginnings. You cannot
really treat them like yet-another-channel. Don't lose sight of the
individual. It would be best to think of p2p as person-to-person rather than
'puter-to-'puter. Each node performs quality assurance. Each node has an
identity. Each node has a reputation. They aren't simply dumb relays. There
will be significant advantages to nodes that maintain a long term identity
and reputation - that can't be driven underground by RIAA litigation.

Read the Cluetrain Manifesto. The new markets are made by people talking to
each other. The days of controlling the channel between 'content mass
production' and 'content mass consumption' are running out...

Artist and audience will soon merge, talking to each other directly.

There is no channel.

Sent: Wednesday, 19 May 2004 11:01am
To: pho@onehouse.com
Subject: pho: RE: pho : Filesharing Is Not the Enemy

Yep, the RIAAvsP2P war is all about controlling the channels, not about losing sales.

They must discredit file sharing - litigate the participants and developers.

The funny thing is though, you'll probably never see the labels creating any licensed file sharing systems. Primarily because there's no point. File sharing is all about enabling people to provide each other which what they don't already have. The labels already have everything, so there's no benefit to utilising p2p to create a system greater than the sum of its parts. If you want a particular track you go direct to the central source (iTunes et al) - there's no point using p2p. And the last thing the labels want is for new artists to have direct access to market, so they require all new artists to go to them.

However, just like Microsoft, what the labels are failing to see on their radar is 'open source', i.e. free music. The labels dismiss this as a non-threat because they don't see how free music can make any money ipso facto it's not a threat or a loss to them. Why would all bar a few crazy artists give their work away?

So the labels don't need p2p and will litigate it until it's devoid of their music.

Fine.

File sharing will evolve such that files are guaranteed not to infringe copyright if they are shared.

File sharing will become one big online gallery of free art where musicians and other digital artists can promote themselves. How do they make money? They sell their art directly to the audiences thus created.

Far from forcing the populace to source their art from the central, authorised sources, RIAA will simply drive people away from hobbled, proprietary, inflexible art and into the arms of completely unencumbered public domain art.

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ttyt, 23 May 2009 @ 3:17am

rt6t
thanks, China printing industry developed this years, who can tell us? China based plastic injection molding services with low costs and supeior quality Steel and aluminum scaffolding for construction is a very useful tool.
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