The Rise And Fall Of The RIAA
from the predicting-the-end dept
We recently had a post questioning whether the RIAA's legal campaign was a success or not. It seemed like there was plenty of evidence that it has been an incredible failure. Separately, we had a post about Radiohead's Thom Yorke, suggesting that the major record labels were going out of business in a matter of months. While we felt that was a bit of an exaggeration, one of our commenters, Ccomp5950 compiled data on RIAA label sales, along with some helpful notes about what other factors were going on at the time:Year: $ in MillionsIt's a great list, but I felt it could be even more powerful as a graph, so I just threw the following together, based on the info above:
1992: 9024
1993: 10046.6 (CD players started to get more affordable towards mid-year)
1994: 12068
1995: 12320.3
1996: 12533.8
1997: 12236.8
1998: 13723.4
1999: 14651 (Work made for hire controversy)
2000: 14404 (Napster sued into bankruptcy)
2001: 13700 (Ipod came out October 2001)
2002: 12,614.2 (Price Fixing lawsuit hits RIAA)
2003: 11,854.4 (Grokster lawsuit, "induced infringement" introduced) (Mass lawsuits by RIAA start(AKA: The education campaign))
2004: 12,345.0 [Revenue Physical / Digital] (BMG gets out of the music business, sold to Sony later on: Big 5 becomes Big 4 for RIAA)
2005: 12,296.9 [91%/9%]
2006: 11,758.2 [83.9%/16.1%]
2007: 10,370.0 [77%/23%]
2008: 8,768.4 [66%/34%] (RIAA declares it's going to stop mass lawsuits with member money problems and EMI almost bankrupt)
2009: 7,690.0 [59%/41%] (Massive layoffs hit RIAA around Febuary: Blames piracy)
Sources:
http://www.azoz.com/music/features/0008.html (statistics from 90's to 2001)
http://76.74.24.142/81128FFD-028F-282E-1CE5-FDBF16A46388.pdf (Statistics for 97 to 2007)
http://76.74.24.142/A200B8A7-6BBF-EF15-3038-582014919F78.pdf (2008-2009)
- If you're not familiar with the "works for hire" scandal, you can read the full background here. Basically, a Congressional staffer by the name of Mitch Glazier snuck a tiny unnoticed amendment into a much larger bill in the middle of the night -- supposedly at the request of the RIAA -- without telling anyone. It effectively changed the definition of music recordings into "works made for hire," which was really important, because it meant the RIAA labels could hang onto musicians' copyrights for much longer, avoiding termination rights that let musicians reclaim their copyrights. Just a few months later, Glazier left his low-paying Congressional staffer job for a $500,000 job with the RIAA, which I believe he still holds ten years later. Thankfully, people quickly recognized what he had done and Congress had to go back and fix Glazier's sneaky wording. However, it is worth noting that the peak of this chart is right when Glazier inserted his infamous four words.
- As we discussed last fall, now that musicians do have termination rights, they're lining up to use them and take their copyrights back from the labels. They can start getting the copyrights back in 2013. If you're looking for a date when the bottom totally falls out for the RIAA labels, that may be it. When the rights to their back catalog starts to drop out, this chart looks even worse. The RIAA won't give up easily, of course. The latest stunt they're trying to pull is to "re-record" albums, claiming that it creates a brand new copyright, that gives them another 35 years before termination rights are applicable. That is, of course, ridiculous, but the RIAA will likely try to fight it out in court for many years to extend that 2013 deadline by a few more years. Of course, all that money on legal fees could have gone to innovating, but that's just not the RIAA way.
- Note that digital music sales is not even close to being a savior. The total is still dropping rapidly.
- Of course, many have argued that the rise and fall may have a lot more to do with CD replacements of previous formats -- and this chart certainly suggests that could be an explanation. The big jump happened right when CDs became affordable, and people needed to go out and replace their vinyl and cassette (and 8-track!) collections. After a few years of that, it makes sense that the market should drop anyway.
- Once again, it's important to point out that the chart above is not the entire music industry, but a limited segment of it: the RIAA record labels, mainly comprised of the big four record labels. It doesn't take into account all of the other aspects of the music business -- nearly every single one of which has been growing during this same period. It also doesn't take into account the vast success stories of independent artists and labels doing creative business models and routing around the legacy gatekeepers.
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Filed Under: record labels, recording industry, sales
Companies: riaa
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And how long until...
/joking, but still think it could happen.
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Re: And how long until...
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While I agree with you completely here, it's a little odd to see a statement like this made without any kind of citation or link to more information/proof. I think a chart like the one you presented loses much of its power and context without another chart that shows the rest of the music industry. Numbers and data from the non-RIAA industry would make this post much more relevant to mainstream thought, which I'm hoping is your endgame.
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i will appriciate your hard work and effort you have put into it and i expect to be seeing it soon?
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Mike Masnick does, though, which is why I thought this feedback might be useful to him. But thanks for the snark!
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Neither does Ccomp5950, that didn't stop him (or her) from compiling this data.
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Re: Re: Re: Re:
I'd look at the rest of the music industry but really it would be more tedious and probably reflect the same, I'd say the only difference would be the Indie labels, I'm curious about them now.
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Re:
We've discussed those numbers elsewhere, and getting this post together was taking quite a while, but some of that info can be found:
http://www.techdirt.com/articles/20091114/1835036932.shtml
http://www.techdirt.com/articl es/20090617/1138185267.shtml
http://www.techdirt.com/articles/20091213/1648377324.shtml
And we've also seen reports stating that musical *instrument* sales have been sky high lately as well...
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Re:
Actually, if you look, the rate of growth (in absolute terms) of digital is slowing (drastically for some of the labels. Suggesting that the growth won't get that much bigger...
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Re: Re: Almost expected.
Additionally, since CD's break, they need occasional replacement. MP3's, on the other hand, can be archived on backup media (external drives, flash drives, tape drives if you're that dedicated) and even if they do get lost, are far cheaper to replace.
Personally, I think digital sales will max out very soon.
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Re: Re: Re: Almost expected.
but they are unencrypted so you can keep a backup if you want. The legality of this varies depending on where you live but even where it is technically illegal it is in practice accepted as OK by all but the most rabid IP maximalists.
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Re: Re: Re: Almost expected.
You are right about people buying less tracks though. Less albums are being sold, because most albums are full of filler and people only want the good stuff.
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Re: Re: Re: Almost expected.
You are right about people buying less tracks though. Less albums are being sold, because most albums are full of filler and people only want the good stuff.
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whole thread and post : So What?
The Music Market , will adjust , and copyright laws will help it adjust properly through new economic models that respect copy rights.
Is that so hard to understand. It is history repeating.
Radio killed newspapers. TV killed radio. Internet is killing TV.
Interesting thing is , We still buy some newspapers:: still the best thing for a subway ride.
Still do some radio:: traffic and weather on the "eights".
And with big braking news , TV is still king,, and will be for a while. ( though I watch CNN online only, I own no TV)
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Re: whole thread and post : So What?
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Re: whole thread and post : So What?
Radio is not dead
TV is not dead
Maybe you are just exaggerating.
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Re: Re: whole thread and post : So What?
It is all a dream, reality is fleeting, and our lives "just wisps" of "warps in space-time".
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Re: Re: Re: whole thread and post : So What?
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Re: Re: Re: Re: whole thread and post : So What?
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According the RIAA or one of the labels (EMI???maybe) the growth of digital music sales has gone flat and is expected to decline as the younger generations age.
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What people also forget is that MTV became huge in the 80s. Before MTV people had to listen to very boring radio to be exposed to new music. Radio had very limited formats and didn't do a good job breaking new forms of music.
MTV opened up tons of new genres for young kids to buy. Rap, black artists such as Michael Jackson, metal, hair bands, grunge, alternative, new wave, etc. Without MTV most of that music never would have found a wide audience.
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Amusingly enough I'd agree with you about that for mainstream American music. Outside of the US, in places like the UK (where BBC radio is contractually obliged to play a certain percentage of new and different music)? New genres are still appearing all the time.
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What are they going to do? Run all the albums through digital filters and say "its a new album".
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Hmmm...
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Digital Not The Saviour
But that's precisely how the industry has poisoned the digital well. They were so scared of piracy, that they've taught us that digital music just won't work the way we want it to. It's hard to reeducate us, and it costs a lot of money.
So, good job music industry. We -- and the music -- will be here long after you're gone.
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Re: Digital Not The Saviour
If you own a cellphone you more than likely have a built in mp3 player. You need head phones and a USB cable for the phone to computer for transfering music.
yw
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Re: Digital Not The Saviour
The "laggards" of today are usually the first to consume technology after a generation.
Source
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Re: Digital Not The Saviour
for cc music, check out jamendo.
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Don't forget...
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Re: Don't forget...
If the labels try this, they're screwed.
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iPod -> Digital sales gap
Seems like the RIAA should have gotten their act together on digital a little faster before they lost a whole generation of potential sales.
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Re: iPod -> Digital sales gap
That might not really be the case. I'm assuming that 2005 was just the first year the RIAA broke them out...
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Re: Re: iPod -> Digital sales gap
These documents assume the RIAA is reporting the items correctly.
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Re: Re: Re: iPod -> Digital sales gap
My view is that they are reporting all of them below what is actually going on to substantiate their claims of piracy. Until I have proff of this I will use their numbers for forcasts.
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You just go ahead and keep throwing tantrums about "pirates" though. I'm sure that will put the genie back in the bottle. %-\
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Of course, no one claimed that piracy has "nothing" to do with this. What we claimed is that the impact of such actions is not necessarily the only thing impacting the market.
And, more importantly, when you look at those who have figured out how to embrace file sharing, and note that they are almost all better off, it's hard to "blame" file sharing. Instead, the blame squarely lies on those who failed to adapt.
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And, more importantly, when you look at those who have figured out how to embrace file sharing, and note that they are almost all better of
You got to remember ,, a lot of Artist and Writers , know & care nothing about copyright. their problem.
But most Artists do -- by far. It is how we eat.
It is a big world, and you can find "any sub-group" to support "any crazy point" you make here Mike on copyrights.
"Good Public Policy" is about the "greater good" , based on "immutable principles".
Problem is politicians write laws.
but
1] "We the people" vote ,
and ,
2} the courts keep congress in check.
====================================
Run for office Mike on anti-copyright platform.
See how you do.
Rand Paul would poll higher than you.
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Re: And, more importantly, when you look at those who have figured out how to embrace file sharing, and note that they are almost all better of
But most Artists do -- by far. It is how we eat.
Artists do not eat because of their copyright. They eat because of a good business model, and fail if they have a bad one. Many of them -- yourself included, apparently -- rely on copyright as a crutch as if it is necessary for any business model.
You are incorrect.
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Re: Re: And, more importantly, when you look at those who have figured out how to embrace file sharing, and note that they are almost all better of
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Re: Re: And, more importantly, when you look at those who have figured out how to embrace file sharing, and note that they are almost all better of
If they have a bad biz model despite that , they should hire better management.
I wish Brain Epstein was here.
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Re: And, more importantly, when you look at those who have figured out how to embrace file sharing, and note that they are almost all better of
See how you do."
Why run for office when the weaknesses are so obvious and easy to attack. Not that you really need to. The media industries keep repeating the same mistake. I fel like I am repeating my self, maybe I should just post when its something new.
David
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Why run for office when the weaknesses are so obvious and easy to attack.
Me : that is a patently ( pun) ridiculous statement. If you are so right , you should win easy,
but you are wrong , So you will only get fringe votes , and be a laughing stock politically, if you run for any office AGAINST copyright LAW, and working or weaken and /or abolish it .
On a Patent reform platform , you might have a chance -- as patent law ( but not is constitutional root ) needs serious reform----., but the gravity of the big $$ interests would crush all reasonable debate into the black holes of "crazy congressional committees"
=========================
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N'Sync
How appropriate for a manufactured boy band to be the peak of the industry.
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Buggy Whip Fever
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Re: Buggy Whip Fever
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Napster launched 1999, sued 2000
A minor point, perhaps, but on a pet issue like this I'd hope TechDirt could get the details right (from either recollection or by double-checking commenter-supplied factoids).
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Re: Napster launched 1999, sued 2000
Also they didn't declare bankruptcy until 2002.
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Re: Napster launched 1999, sued 2000
A minor point, perhaps, but on a pet issue like this I'd hope TechDirt could get the details right (from either recollection or by double-checking commenter-supplied factoids).
You're correct. I've updated the post and the chart...
Good catch.
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A different perspecitve on sales
Fast forward to the digital age and, until recently, this was still very much the case. iTunes made a fundamental change in the buying habits of consumers. Instead of purchasing an entire album for $10 the consumer now had the option of buying the two songs they wanted for $2. The fan is still getting what they want but at a fraction of the cost of what it was previously.
Indeed, if you take this into account you see that the numbers the RIAA has painted are not that bleak after all. Let us "convert" digital sales into physical sales. If people only want two songs out of an album of ten, then to convert the digial sale to a physical sale you would multiply by five. Or, to put it another way, if digital sales were not available the music fan would need to spend $10 to get the two songs they want instead of $2. Using this metric (and a few minutes in Excel) you see that the "music industry" has continued to grow in recent years.
People are still buying the songs they want, but they are buying less fluff and this is where the RIAA has a problem. They produced fluff to pad the good stuff. Now that digital downloads are available the fluff no longer sells.
Perhaps the real failure, is the failure of the RIAA supported bands to produce an entire album of good music? I do know that of the last 10 albums I have purchased not a single one has a contract with a major record label and, in my mind, virtually ever song on every album is worth listening to and paying for. Have we reached the stage at which the consumer is able to make more decisions concerning what they need to purchase in order to enjoy a few songs?
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Re: A different perspecitve on sales
Anything less than a dollar is basically an impulse buy. I can easily buy three or four songs a week. This compares to one or two CD's a year in the old days. A $15 CD is not an impulse purchase in my case.
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So that's what's going to cause the end of the world. Without the RIAA everyone will stop creating art and music and mass boredom will lead to pandemic outrage which will cause the rise of the antichrist who will take over the world.
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Comparison graphs...
People only have so much cash to spend on entertainment. The costs of it keep going up... wages are not. Add to this the fact that we're in a global recession giving people even less money to throw around loosely.
The RIAA only sees things in black and white (their own accounting figures), but if you add all the other colors of the spectrum into the picture, it changes the appearance of the picture completely.
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Re: Comparison graphs...
YEAR VHS/UMD DVD BR/HD Total
1999 12.5 0.8 0 13.3
2000 11.8 2.5 0 14.3
2001 11.1 6.8 0 17.9
2002 9.1 11.6 0 20.7
2003 6.1 16.1 0 22.2
2004 3.7 21.2 0 24.9
2005 1.6 22.8 0 24.4
2006 0.4 24.1 0 24.5
2007 0.1 23.3 0.27 23.7
2008 0 21.6 0.75 22.4
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Re: Re: Comparison graphs...
1999 - DVD: $0.8 Total: $13.3
2000 - DVD: $2.5 Total: $14.3
2001 - DVD: $6.8 Total: $17.9
2002 - DVD: $11.6 Total: $20.7
2003 - DVD: $16.1 Total: $22.2
2004 - DVD: $21.2 Total: $24.9
2005 - DVD: $22.8 Total: $24.4
2006 - DVD: $24.1 Total: $24.5
2007 - DVD: $23.3 Total: $23.7
2008 - DVD: $21.6 Total: $22.4
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Re: Re: Comparison graphs...
What this tells you: Part of the reason sales declined, is that CD's are becoming as obsolete as VHS tapes, and MP3's are like DVD's.
Imagine if the MPAA had refused to release DVD's, but the rest of the world did release them. Could the loss of VHS sales be attributed to "piracy?"
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Re: Re: Re: Comparison graphs...
Trying to find some gaming industry numbers covering the same time period, I've so far only found this...
http://img808.imageshack.us/img808/1007/gameindustry.jpg
http://img820.imageshack.us/img 820/3381/gameindustry2.jpg
... from this Page:
http://www.slideshare.net/lindja2/wandamelonidfc
Their numbers in 2008 more than doubled the CD and DVD numbers combined.
Nobody is getting "raped" by piracy, the entertainment dollars are just being spent elsewhere. People are just making simple choices as to where they feel they get the most value for their hard earned money. People are still spending a fortune on entertainment. I'd be willing to bet if we had total concert revenue numbers for the same period it would be explosive as well.
Bottom line?
The industries crying the loudest are killing themselves. If you remove file-sharing from the equation and bring a 100% end to it... people's money is already spent elsewhere anyway so their revenue will not rise any, but new emerging artists who rely on it will be significantly hurt.
If you are in the business of selling discs, overcharging for downloads that can be infinitely supplied at little to no cost... your business is doomed.
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The single was nearly gone, all that was left were CD singles that cost nearly as much as the full album. Then along came the Internet and the MP3 file format. The first response from the RIAA was that the MP3 file format itself was illegal. This is the mentality we've been enduring and will continue to be subjected to because the RIAA members aren't going anywhere. Bank on that.
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The rise and fall of a cartel
Today, we depend far less on these corporate radio stations for exposure to new music. We can sample music from independent labels and unsigned or small bands very easily now on the internet.
The RIAA cartel has lost its iron grip on the retail music market, and this is a very positive development both for musicians and listeners.
Other factors were certainly significant, such as the heavy-handed legal campaign of the RIAA, which I would nominate as one of the worst Public Relations disasters of all time.
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the knowledge in your brain is copyrighted! time for a lobotomy!
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Forgot the glut of remastered CDs!
Right now, there's no shortage of used CDs from the remaster glut of the 90s and 00s.
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Intellectual Property is theft
To understand intellectual property you have to go back to when it was first founded: by the royalty of old to raise money (extort money) from the populace without having to raise taxes. Instead of raising taxes to steal from the population, the royalty would grant a monopoly to a particular favored person who would then give kick-backs to the royalty as part of the deal.
Intellectual property was never about encouraging innovation, that is simply the petty rationalization that came afterward. It was always about stealing from the population in a roundabout manner that the humble minds making up the majority of the population could be easily fooled by.
Well now is your opportunity to educate thyself and be fooled no longer.
Read Stephan Kinsella's Against Intellectual Property (for free, I might add):
http://mises.org/books/against.pdf
Watch Copying Is Not Theft:
http://www.youtube.com/watch?v=-9CK-vwYOwU
Visit Question Copyright:
http://questioncopyright.org/
And if you really want to get educated then read some Frederic Bastiat:
That Which is Seen, and That Which is Not Seen
http://bastiat.org/en/twisatwins.html
The Law
http://bastiat.org/en/the_law.html
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Re: Intellectual Property is theft
Intellectual property was never about encouraging innovation, that is simply the petty rationalization that came afterward. "
Sounds realistic, but I would like to read more. Do you have sources indicating this?
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The Rise and Fall of the RIAA
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Re: The Rise and Fall of the RIAA
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