Can You Support An Entire Recording Industry By Shaking Down Music Fans?
from the that's-the-plan-in-germany dept
A bunch of folks have been sending in the various reports concerning how German industry association ECO claims that ISPs in that country are currently handing over names of 300,000 users per month based on accusations (not proof) that their IP addresses are involved in unauthorized file sharing. In response, the various copyright holders, or their agents, are using the info for a massive shakedown of those users, sending them letters and demanding cash:Rights holders have long pursued countless German file sharers with legal means, often going after tens of thousands of users at a time. Initially, this was done through ordinary lawsuits, but revisions to local copyright law now make it possible to simply get court approval for requests to ISPs to unveil a subscriber's identity. Content owners then send threatening letters to alleged infringers, asking them to pay anywhere between €300 to €1200 ($430 to $1720 USD) per unlawfully-shared file.Basically, this is like ACS:Law or US Copyright Group on a much larger scale -- without ever involving any actual proof or conviction. Apparently, the rights holders in Germany are thrilled with this situation, since it's making them a lot of money. But, can it really last? This entire "business model" appears to be based on the idea of shaking down your biggest fans, and making them hate you for it. It's hard to see how that's a "growth" model, and the inevitable backlash is going to be fierce.
Last year, when I was in Berlin for Berlin Music Week and various associated events like All2getherNow and Popkomm, one thing that struck me was how industry-centric the German music world is -- and how the artists themselves are feeling stifled. It amazed me how many German musicians told me of how ridiculous it was that they weren't allowed to offer up their own music for free on their own websites, thanks to the rules that collective licensing agency GEMA setup. A few even showed me their official websites, with no music, and their "unofficial" websites, which had streams and downloads, which they couldn't admit to without running into trouble from GEMA.
This is what the recording industry is driving for elsewhere. A scenario where the only beneficiaries are the gatekeepers, and the consumers and the artists themselves are made to feel like interlopers. It may work for a short period of time, but I have trouble believing that such models are sustainable at all, in the long term. We're seeing more and more success stories from artists and forward-thinking labels who are happy to embrace what the technology allows and embrace what fans want. It seems like a bad idea for the entire German industry to be moving in the exact opposite direction.
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Filed Under: germany, recording industry, shakedown
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What else is new? Sometimes I think the collective recording industry's intention is to see how many people they can piss off. I have come to the conclusion that they are striking out at everyone for no real or rationale reason.
They are self defeating.
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RIAA & MPAA=MAFIAA
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Mike, I love it when you act clueless. Copyright has been about protecting wealthy middlemen to the detriment of consumers and creators for centuries. This is nothing new. I just wish the rest of the world found it has disturbing as we do.
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> industry's intention is to see how many people
> they can piss off. I have come to the conclusion
> that they are striking out at everyone for no
> real or rationale reason.
The kind of high quality posting that their anonymous mouthpieces produce regularly on these forums are evidence of that. They maintain such a high level of decorum. Their thought process is so rational.
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I'm sure that authors and creators would never create their work without the assurance of knowing that after they die, sometime during the 90 extra years after life of the author, that copyright will again get extended by another 40 years after life of the author.
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Rolling over and playing dead isn't a good business choice.
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' These people are illegally sharing content.'
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Neither is shooting yourself in the foot (or more like head in this case).
If they don't want their business model to be to sue their fans, then why are they doing it?
There are countless ways to adapt to the changing market. If they don't want to die, then fucking adapt.
It is that simple.
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Why is litigating the masses a good business plan?
If you're conceding that the recording industry has failed and the only option is the slash and burn whatever you can before you go. Then fair enough.
Otherwise, a common theme here is that maybe you should be spending your time and effort getting your customers to actually buy things.
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> is sort of ignoring the main point
It IS a shakedown. Make no mistake. No other word describes it so precisely.
> These people are illegally sharing content.
Then prove it and sue them. And I hope you win some reasonable damages (not $75 Trillion) and I hope you stop them from sharing in the future.
> I don't think anyone wants their business
> model to be suing people,
> that isn't anyone intention.
You are certainly right about that.
That's why they are in the SHAKEDOWN business.
They send letters to people merely accused, threatening them with suit, but never filing suit, hoping it is cheaper to settle.
Shakedown is the perfect word to describe that behavior.
It's like paying a protection racket. It is cheaper to pay than to hire people to guard your business from getting accidentally burned down.
> But at a point where your legal business
> models are being overwhelmed by illegal
> activity, something has to happen.
Yes. Something has to happen.
One 'something' is to get into the shakedown business.
Or, you could try to stop the illegal activity. One way to do that is, again, the shakedown business.
Another way to stop illegal activity is to get to the source of it and stop it -- through the actual court system.
Another way to stop it is to sell what people want at a reasonable price. Then you wouldn't be getting monopoly rents. But it would greatly reduce piracy.
Consider this: why are people resorting to the illegal activity?
I know you have already formed a simplistic conclusion. But try to think deeper about it for a moment. It is ultimately because people cannot get what they want at a reasonable price.
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Suppose they win the majority of the cases and recover some money. Then what happens? Will people magically start "behaving" and stop sharing files? Will their sales increase?
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> to sue their fans, then why are they doing it?
They're not suing.
They're sending shakedown letters.
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Really? So without ANY proof, or ANY trial, or ANY recourse, you think its perfectly OK to go after people just on an accusation?
Ok then.
I think you are obviously a pirate. I have no proof, but you are posting on this site and using the internet. You have obviously infringed on SOMEONE's rights, so you should be fined. This is perfectly acceptable, correct?
The government comes knocking on your door one day and says the THINK you have downloaded child porn because they saw a packet of something go across your internet connection, probably through your wifi. Its perfectly acceptable to throw you in jail, with no trial or recourse and without any proof, correct?
Its amazing to me that people can say such things and not realize that, in the right circumstances, its going to apply to THEM as well, someday.
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If you honestly think that copyright middlemen (Viacom, Disney, Sony, etc..., not to mention all of the blood-sucking collection societies) will simply disappear one day, you're either a fool or an amazing dreamer.
As I've written about before, the copyright industry has faced technological difficulties in the past. When that happens, it has new laws passed which open up new monopoly rents to sit back and collect.
And even if by some bizarre circumstance today's middlemen disappear, they will be replaced by new middlemen. When governments are happy to give out monopoly rents to collect, the connected and wealthy will line up to take their cuts. (And then they'll fight like hell to get even bigger cuts.)
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Re: ' These people are illegally sharing content.'
Because requiring actual proof would disrupt their business model. (business model = shakedown business)
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Rolling over may not be a good choice, but if you're not going to evolve, then what choice is there?
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I'm done....
I don't care if you starve.
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Of course it can!
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Do you sue your former customers for not coming in? Do you sue the new restaurant for unfair competition or for interference with business relationships?
Or do you compete by making a better product that people want to pay for?
If you choose the former, you're part of the copyright industry which lacks the capacity to compete in an open and free market.
If you choose the latter, you're a successful businessman.
And I'll just point that people are willing to pay for legal services such as Netflix and iTunes. But only in the crazy world of copyright does the copyright industry want to kill them. (Netflix here and iTunes here.)
To the copyright industry, it's not about competing or giving customers what they want. It's about sitting back and collecting government granted monopoly rents. When the copyright industry sees newcomers collecting some of their god, er, government-given monopoly rents, they go ballistic.
You might think this is about stopping piracy. But it's not. To the copyright industry, it's about destroying any and all competition to collect government granted monopoly rents.
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Please provide proof that every one of the people who has received a letter demanding payment has shared files illegally.
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"Basically, this is like ACS:Law or US Copyright Group on a much larger scale -- without ever involving any actual proof or conviction."
Are you saying that these settlement offers exist outside of German jurisprudence? Often is the case where a settlement demand for alleged wrongdoing proceeds the filing of a lawsuit in the US.
Masnick, someone could send you a demand for $100,000 tomorrow to settle allegations of defamation. Your lawyer would examine the allegations and the law and either recommend that you settle or take it to court. In court, the plaintiff would have to then offer proof. There wouldn't be a conviction as that is a concept for criminal offenses.
It sounds like Germany has simply seen the fairness to rights holders in revealing the names of people who are infringing rather than continuing to hide behind an anonymous IP address. Though not discussed, I'd guess that the plaintiff would have to demonstrate some evidence that the addresses were involved in the exchange of infringing content, but guess you left that out so as not to diminish the impact of your contrived hissy fit.
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How do you compete with free?
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Just competing.
Try re-reading.
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> tomorrow to settle allegations of defamation.
Good example of what happens for a real allegation of defamation.
In this case however, we're talking about a shakedown. The demand is more likely to be for merely thousands of dollars. Now you have a quandry. It would be cheaper to pay the extortionist than to defend it in court -- even if you know beyond any possible doubt that you are innocent.
That is why this is a shakedown.
No proof. No conviction. Just accusation. And done in private.
No wonder the laws were changed to allow this. It's an extortionist's dream come true.
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That hasn't been proven in a court of law, they have only been accused of illegally sharing content. Sure, the accused can go to court and fight it, but that's expensive. The accusers have no intention of ever going to court either (it's expensive for them too, plus they have to actually, you know, prove stuff). This is what makes the shakedown letters extortion, plain and simple. To paraphrase a bit, "Give us the money or we'll break your kneecaps". Sound familiar?
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I have a serious question for any RIAA spokesperson here
Now suppose I were to receive a shakedown letter accusing me of file sharing and demanding, say, $3000.
What would you recommend that I do?
That is a serious question. My assertion is true. I sincerely would like to know your opinion.
I truly do not expect to get one single sincere good faith reply.
Nevertheless, thanks in advance.
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That's how Germans do things
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Net, they are still on the right track. I don't think anyone can come up with a valid music business model that has as many dollars in it as the music industry does today.
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Re: I'm done....
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Re: I'm done....
As for DVDs, I don't buy those either. Happy Netflix customer since '99.
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Re: I have a serious question for any RIAA spokesperson here
Sorry, not an RIAA spokesman but I did watch "Judge Judy" once and was involved in a rent dispute that went to small claims court before.
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Why would you think that? I recommend putting the $3000.00 to work by getting a lawyer to fight it and try to get the legal fees included. Then backup your music collection, give to a friend for safe keeping and delete every mp3 that doesnt have a physical CD or itunes receipt. Wipe your hard drive and reinstall the OS and wait.
If your wireless router is secure and you dont have "friends" that download music when they come to visit, there shouldnt be a problem. I would assume they would eventually drop it, but only after you've spent $$ defending yourself.
These shakedown letters should be met with resistance and law firms issuing these letters should be responsible for paying the defendants legal fees...no matter how much they are. That would put the brakes on this practice real quick.
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I think the reason they've been so successful at this in the past is that they ARE the media. They decided what was reported on and what was broadcast. Someone who questioned intellectual property monopolies wasn't able to voice there opinion effectively. (This is still the case in corporate controlled media channels. Even NPR.)
Thanks to the Internet those who question the value of the status quo have a platform. Maybe that's another reason the entrenched interests are freaking out right now. Ultimately, they want to control the Internet. And if they can't do that they want to turn it off or effectively turn it off by turning into cable TV.
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Maybe it's time to start selling Android mobile phones with the added bonus of getting access to the complete back catalogue of Universal, Warner, Sony and EMI for a few extra dollars a month?
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It used to be big news and a sign you made it when you were "signed" to a label.
Now it seems to be the reverse. A stripping of your right to your own content. Man if you think about it this could be good. What will the labels do when they have no artists?
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Lets list some facts:
The music industry is making a lot of money today.
Piracy is still rampant today.
Anti-Piracy actions have little to no affect on piracy.
Those three things tell me that the music industry is making a hell of a lot of money despite piracy and despite them wasting millions on this anti-piracy campaign.
So I guess the question comes down to; do you think it's OK for them to keep making their money at the cost of their artists, independent artists, and fans everywhere?
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IP addresses do not correspond to a single individual, much less prove who perpetrated the copyright infringement. The names being offered up aren't proof of infringement so revealing the names is merely opening many people (many of whom likely did not infringe) to facing a choice between paying for a lawyer or paying to make the threats go away. Either way, people who have not done anything wrong are being forced to spend money they shouldn't have to spend.
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Even if there isn't a new business model that has as many dollars in it, the model they're using right now is fast disappearing. They can choose to stay on the sinking ship, or to get onto the lifeboats and survive. Raging about how they want to go back to 1990, when things were wonderful for them, isn't going to change the fact that their distribution business is NOT needed by consumers any more.
They used to have the monopoly on recording studios, but albums are now being cut in bedrooms, with cheap, high quality equipment. They used to have a monopoly on pressing LPs, but now anybody can make a CD in their home computer. They used to have a monopoly on distribution of plastic disks, but now there's a network and a format the remove that need.
The future of the music business is content recommendation and identification - not in distribution or production. The market has already solved those problems.
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And if your contract with a label prohibits you from doing something like that and it is important to you, why would you sign to begin with?
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You can either do that and succeed or not do it and fail. It's up to you.
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If pirate websites can offer the downloads for free, why can't the music industry offer much more for a price? They could easily pull people away from the now less convenient sites. No suing the fans needed.
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If you just give up
No one, not even me, has told you that we expect the legacy industries to just give up.
Compare that to what business you have left when you take legal action against the people who are undermining your business.
If you don't cannibalize your own business model, someone else will do it for you.
This is not a legal problem, it is an economic one.
Net, they are still on the right track.
That's like saying
I don't think anyone can come up with a valid music business model that has as many dollars in it as the music industry does today.
I don't think that anyone could have come up with a valid buggy whip manufacturing business in 1910 that has as many dollars in it as the buggy whip manufacturing had in 1890.
Ok, that's flippant. But also true. I actually think your premise is wrong. How do you explain that every study of the entire music industry shows it is growing, not shrinking? People are spending more on concerts and shows, merchandise, and other things. All that's shrinking is recorded music - mostly on plastic discs, but paid downloads aren't growing much and won't ever match it.
Your old cash cow is dead. It doesn't matter how it died - if you keep expecting it to make you the same amount of money you'll be disappointed. There also is no silver bullet that will resurrect it, but waiting for someone else to figure one out for you only means they get the money and you don't.
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Net, they are still on the right track.
That's like saying slowly walking away from the shoreline will save your from the tsunami racing towards you. You better run your ass off to high ground if you want to survive. Also, if you can't run fast, get out of the way for everyone else.
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Then why are your knickers in such a twist?
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Re: RIAA & MPAA=MAFIAA
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Uh, because they do have an affect on those NOT involved in piracy there, genius?
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That's just one reason.
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Infringement is NOT a criminal offense...yet.
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You're seriously suggesting that an IP address is a bar to due process?
What a joke.
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Us individuals are fighting the government along with powerful monetary interests, who's entire purpose is collusion in this regard.
The government wants to be secure in continuing its current trends. Something as small as Wikileaks usurps that. Doesn't help that politicians get paid based on the lobbying dollars thrown around.
The entrenched interests love the status quo that copyright (artificially) gives them. The record labels can make life hell for smaller artists and startups, by taking away their access to platforms. The RIAA trains judges and law enforcement to seek out copyright crimes for other drug charges. Link
Now we already know that there's NO links between copyright infringement and criminal organizations. But if you have someone using this old video as a training tool in this day and age, you get the same people doing ICE takedowns with faulty affidavits. I'd hope that we can see more training videos for law enforcement, but sadly, this is currently the only one out there that I know of. So, getting back to the original point, it's quite hard for people to organize effectively when you have such powerful interests that are working against you.
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Indeed. But if someone were to send out hundreds of thousands of those threats, and conveniently price the "settlement" fee at less than what it would cost to hire the lawyer to review it, many people might suggest that's extortion.
But, not you, apparently.
It sounds like Germany has simply seen the fairness to rights holders in revealing the names of people who are infringing rather than continuing to hide behind an anonymous IP address.
Because in your technologically illiterate world, IP address is clearly a single individual and accusations of infringement are proof of infringement.
This is it's so troubling that folks like you write these laws.
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Except, of course, this wouldn't be in small claims court, and you know it (or you are stunningly ignorant of how this works). While those doing the shakedown offer a "settlement" of $3,000 or so... they also threaten to take you to federal court insisting (often incorrectly) that you could be liable for $150,000. So this wouldn't be a small claims court case at all. And you either know that, or you haven't been paying attention.
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Let's suppose this is true.
Business models can/do/should fail. Nothing stays the same forever. Business models need to be adapted or abandoned as technology and competition evolve.
It might seem unfortunate that a business model needs to be abandoned, because people often lose their source of income as a result, but it is the price of evolution.
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Look, the fact that you have no insight into how to compete with free doesn't mean that everyone else is equally clueless. We see companies competing with free successfully all the time.
Didn't you hear all those reports about how successful Netflix has been in competing with unauthorized sharing. How? By providing a *convenient* solution that works really well. You can compete with free quite easily if you know what you're doing.
Clearly, you are admitting that you don't know what you're doing. So why is it that you're pushing laws to punish those who do?
I guess those who can, do. And those who can't, go into "policy circles" to get in the way of those who can.
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Again, that's simply not true. Why would you lie? Is your position so weak that you now need to make stuff up?
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Re: Re: I have a serious question for any RIAA spokesperson here
So your legal opinions and insight are all based on having watched an episode of Judge Judy? Thanks for clearing that up, you've taken "troll" to a whole new level.
PS - Sorry it took so long to respond, had to catch my breathe and peel myself off the floor.
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Ultimately I think the solutions have always been technological and always will be. The rich and powerful will always have the ear of lawmakers but people interested in things staying just as they are can only ever react. Technology will always be one step ahead of the intrenched interests.
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So you would preserve evidence because you received a mass mailed extortion letter? What if you ripped a CD but no longer have the physical CD...how would you prove that you purchased it? So hell yeah, destroy the evidence. It wouldnt be done to conceal a "civil wrongdoing" since nothing illegal occurred in the first place. Go back and read the comment I was replying to.
And as far as the "mindset of freeloaders"...I do not download music illegally, nor have I purchased a single song in over three years thanks to Pandora, Last.fm, Youtube, and podcasts. Buying music today is a complete waste of money. So yeah...Im a freeloader!
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Why should I backup my music collection if it is all legal? I don't use iTunes, but do use other legal sources. Why should I reinstall Ubuntu?
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Obviously the lawsuits are far more fatal. Especially considering "the people who are undermining your business" are consumers and potential customers.
There's no way these shakedown schemes actually convince anyone to pay for content. Even if it does negatively effect piracy, that doesn't mean it positively effects sales.
So, in the end, nobody will buy your product anyway, and shakedowns become your entire business model.
This is something that was brought up by many, many people to the RIAA when they started suing grannies and welfare moms in the late 1990's. They went ahead anyway. Did it increase their revenues? No, it did not. Did the public come away with the idea that filesharing is a bad thing? No, they did not. They came away with the idea that the RIAA is a bunch of money-hungry pricks whose moral values are only slightly better than Goebbels'.
That's why they stopped suing the public... and started bribing Congress so the U.S. Government can do it for them.
I don't think anyone can come up with a valid music business model that has as many dollars in it as the music industry does today.
That's because the record industry held a near-monopoly on music. Monopolies can always make more money, because the price is dictated by the monopoly industry, and not by consumer demand.
That's why a valid business model will never have "as many dollars in it" as the record industry does today. Their profits were driven by something that is not "a valid business model" under pure capitalism: it relied on government-granted monopoly rents for its sustainability.
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Remember that these letters are sent to people based on the IP address of some piece of equipment that might have accessed or shared the content in question.
I believe the 'innocent until proven guilty' statement stems from the earlier statement I think to try to pin this as a shakedown is sort of ignoring the main point: These people are illegally sharing content. which makes us non-law student plebes think of criminal activity instead of civil.
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-If the recording industry gives up, it will die.
-If the recording industry attacks it's customer base it will die.
-If they pull their collective heads out of their asses and give the consumer what they demand, they will live. They will make less money than they have in the past, but they will be alive.
I know which conclusion I'm betting on...
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Very, very few will say "no thanks"
...the rest of them will say "hell no."
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Because the music industry today has too many dollars.
The basic fact you are ignoring however is that in the long term you cannot force people to pay you. People that are being shaken down might have wanted the product they "took" before you wrote that threatening letter - but afterwards? Do you really think they will ever want it again?
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First step By being free yourself - get the consumer on your side.
Second step - offer them other things that have non-zero marginal cost. This could be merchandise = or other things - like the opportunity to influence future production.
ALternatively you offer stuff at a reasonable price - like Magnatune or the Russian content site Rumvi - and people will pay for the convenience and the warm feeling of contributing back.
Remember - people are not the greedy so ans so's you think they are (just because you are mean and greedy it doesn't follow that everyone else is!) People give gratuities in restaurants - and they give a little more when the service is good - look around you and learn!
These lessons have been repeated again and again on this site - but you never seem to bother to understand.
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Then you won't have to worry about it.
See? Problem solved.
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You people are fooling exactly nobody. Not a single person.
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Freetard.
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How do you compete with free?
Mog
itunes
Pandora
Amazon
Rhapsody
and on and on.
The options are there already. They've adapted.
But slimeballs are still greedy and choose to break the law. And you try to facilitate it continuing by dissing all piracy laws and enforcement.
You are seriously the most cowardly weasel on the web.
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I'm going to assume you're quite rich. I have no problem with that, well done. But only someone with significant financial resources would so flippantly suggest that getting a lawyer involved and trotting off to court to prove your innocence is such a trivial matter. For many people that's simply not an option, because it would cost far more than they can afford. And that's the whole point behind the shake-down letters. It's plain ol' extortion: getting someone to pay up, even if they're innocent, because they have no other viable choice. It's shocking you can't see that.
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Looked in the mirror lately?
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And if your contract with a label prohibits you from doing something like that and it is important to you, why would you sign to begin with?
Then...
A musician signing with a label is akin to being selected in the NFL draft. Very, very few will say "no thanks"
Didn't you just answer your own question?
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music piracy
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Re: music piracy
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Silly German Fascists!
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It Seems To Be Working
As a result, it says, while most of the world is seeing an increase in piracy, it's dropped by a fifth in Germany since 2008. This is despite the fact that the number of legal downloads in the country has grown by 30 percent."
Read more: http://www.techeye.net/internet/copyright-holders-clean-up-in-germany#ixzz1OEzd76uM
http://www.tech eye.net/internet/copyright-holders-clean-up-in-germany
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> valid music business model that has as many
> dollars in it as the music industry does today.
Your statement assumes they're entitled to keep making the same amount of money until the end of time.
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