RIAA Knows (But Tried To Hide) That Most 'Unpaid' Music Acquisition Comes From Offline Swapping

from the online-piracy-is-a-footnote dept

Fri, Jul 27th 2012 8:06am — Mike Masnick

Lots of people have discussed this in the past, but the RIAA's focus on going after file sharing sites and online cyber lockers seemed to ignore the fact that so much music is actually shared on a person to person basis -- rather than online. But, there weren't any public numbers that showed the relative difference... until now. Torrentfreak got their hands on a "confidential" presentation put together for the RIAA by NPD, which shows pretty clearly that most of the "unpaid" music that people get comes from person to person copying, via hard drive trading and burning/ripping from others. P2P and cyberlockers actually make up a relatively small percentage:

To be fair, I've found NPD's numbers to be suspect in the past, but they are one of the RIAA's favorite vendors for this kind of data. So, if even they're showing that online file sharing is relatively small, then that's at least noteworthy. The fact that this information had been kept "confidential" certainly suggests that the RIAA knows this highlights how all of their freaking out over online access to unauthorized content is exaggerated, and that people can and will find plenty of other ways to share.

One hopes that this doesn't presage more attacks on such person to person sharing either, but I wouldn't bet on it. Remember, we're talking about an industry which has regularly sought to plug the analog hole. When we see proposals in Congress that would effectively allow Customs officials to start searching hard drives and MP3 players, you have to wonder if the entertainment industry is really gearing up to go after this kind of sharing as well.

Of course, what would be much nicer (and a hell of a lot more effective) is if they finally woke up to the fact that this is a reality -- and that there are ways to deal with it on the product and business model sides, rather than on the enforcement side. If they put one-tenth the effort into helping out with that as they do for pushing for greater enforcement, the online music landscape would look so incredibly different and would be so much better for everyone.

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Filed Under: music, personal sharing, sharing, sneakernet, unauthorized access
Companies: npd, riaa

55 Comments

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Zakida Paul (profile), 27 Jul 2012 @ 8:20am

The only stat that the RIAA will pay attention to
Is the 65% paid and 35% unpaid one.

The rest will be ignored.
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Julian Perez, 27 Jul 2012 @ 8:31am

What's impressive to me is, people are getting their music the same way they always have for generations: recording it off friends.

Who didn't copy a friend's tape back in the old analog days? This is why strict, maximalist copyright types look so ridiculous to most of us: everybody copies, and everybody always has copied and nothing new has changed. Insisting you'd never violate IP law ever reminds me of the Victorians who loudly insisted they'd NEVER masturbate.

Another thing to notice: the sales of recorded music online are up. I guess all the "sky is falling" posturing about streaming was just that.
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Josef Anvil (profile), 27 Jul 2012 @ 8:31am

So what now?
Seems the only way to combat this type of privacy (yeah not piracy) is to roll over the 4th Amendment. They have to search and find digital files and then start arresting people who have likely shared files.
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blaktron (profile), 27 Jul 2012 @ 8:33am

Is it just me, or....
does the fact that this leaves out streaming and licensing as 'music acquisition' in order to bolster the Unpaid numbers?
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Dark Helmet (profile), 27 Jul 2012 @ 8:33am

Obvious data driven solution
It seems obvious that this data points to only one logical conclusion:

Record labels need to immediately stop going after digital lockers....and go after REAL lockers. Break down school doors and start going through kids' shit, since surely that's where they're hiding their cell phones, mp3 players, thumb drives, and also pot/whizbangs/bathsalts/whatever the fuck kids are doing these days to get ripped.

Yes, the digital approach hasn't worked yet; perhaps that real approach will. So go break some kneecaps, RIAA. I mean, is it really worth pretending you aren't a mafia racket anymore?
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ken (profile), 27 Jul 2012 @ 8:34am

Cyber-Lockers account for a tiny fraction.
Cyber-locker music sharing only accounts to 3-4% however the RIAA and MPAA are at war with the very concept of off-site file storage. They have severely crippled cloud computing for an significant problem.
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Zakida Paul (profile), 27 Jul 2012 @ 8:36am

Re: So what now?
For God's sake, man, don't give them any ideas.
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Anonymous Coward, 27 Jul 2012 @ 8:37am

Google Ad about Google Play and how it gets synchronized automagically everywhere.
http://www.youtube.com/watch?v=IqVYDwQRom4

Apple and its Apple TV basically do the same thing and others are trying to emulate that right now, except for the "artists", you know them the con artists that call themselves CEO's of labels, TV networks, studios and so forth.
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Zakida Paul (profile), 27 Jul 2012 @ 8:38am

Re: Is it just me, or....
Good point, I wish I'd thought of it. If this is not included in 'Paid Downloads' services like Spotify and Last FM would add to the 'paid' side.
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ErikJHeels (profile), 27 Jul 2012 @ 8:39am

Eating Your Coffee Beans, Throwing Away The Liquid
The RIAA should re-label it's chart.

Change "unpaid" to "marketing" and "paid" to "sales."
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ErikJHeels (profile), 27 Jul 2012 @ 8:40am

Re: Eating Your Coffee Beans, Throwing Away The Liquid
Here is the URL for the article I referenced:

http://www.erikjheels.com/153.html
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RoKphish (profile), 27 Jul 2012 @ 8:48am

... otherwise known as Sneakernet
http://en.wikipedia.org/wiki/Sneakernet
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James Plotkin, 27 Jul 2012 @ 8:49am

surprising numbers
Assuming for a moment that these figures paint an accurate picture of the music sharing landscape, they are a little surprising.

Maybe it's all the rhetoric from the content industry that everyone is going broke, but I would have though that P2P and cyber lockers would make up a larger part of the illicit music sharing world.

Personally, I see IP rights as an important part of a country's economy. I believe in the IP right. That said, I don't believe in fear mongering. I don't believe in guilt campaigns against the general public with the goal of shaming them out of a given behavior.

The current system is broken because it was never made to account for the current social paradigm and the vehicle that makes it possible, the Internet.

IP rights in general and copyright in specific must be reworked to coexist with the digital landscape and the values of the people that occupy it...
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Yogi, 27 Jul 2012 @ 8:49am

No Ears
The RIAA should finally get at the root of the problem and that means : ears. Ears are the means through which people actually hear music and as long as people have ears there will always be infringement.
Therefore, ears should be outlawed. All US citizens will have their ears lawfully chopped off. Then, those who pay will be fitted with a licensed EAR, and for a flat monthly rate they will be able to hear whatever they want, including music.

And those that don't have enough money to pay for hearing? Well, tough luck, they were probably pirates anyway.
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Richard (profile), 27 Jul 2012 @ 8:57am

Re: The only stat that the RIAA will pay attention to
Is the 65% paid and 35% unpaid one.

Cut that - reverse it...
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Zakida Paul (profile), 27 Jul 2012 @ 8:59am

Re: Re: The only stat that the RIAA will pay attention to
Oops, I was half asleep posting that. You all know what I mean though.
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Richard (profile), 27 Jul 2012 @ 8:59am

Re: Obvious data driven solution
It seems obvious that this data points to only one logical conclusion:

Sorry DH - your conclusion is not the right one - the right one is MUCH simpler..

If 65% of activity is illegal then the law is wrong.
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Anonymous Coward, 27 Jul 2012 @ 9:03am

Re: So what now?
It would be a lot easier just to assume that people are guilty. That is the RIAA's tried and true method up until now.

All they need to do is to hire an outside consultant who will develop a profile of people who are likely to fileshare. Find a judge willing to issue mass subpoenas for discovery against everyone who matches or sort of matches the profile. P2P file sharing cases have shown that finding a suitable judge is fairly easy. They can start with a list of judges who used to be RIAA lawyers. If people don't roll over and settle, then they will have to do discovery. Discovery gets expensive for both sides, so we probably need a new law that says that in these cases the person being sued has to pay for both sides of the discovery process. We are presuming them to be guilty, so paying both sides seems reasonable. After all, the 5-or-6 strikes program requires people to pay to prove their innocences. If congress balks at doing this (those pesky SOPA tech companies might get in the way again) we could always resort to getting international trade agreements.
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Lowestofthekeys (profile), 27 Jul 2012 @ 9:04am

Check out this podcast from 2009 with Cary Sherman (the guy licks his lips every 30 seconds) - http://www.npr.org/blogs/talk/2008/01/rip_this_and_sue_that.html

I found it interesting where Cary tries to clean up the language and skirt around the RIAA's legal stance on ripping CDs.

Also he specifically says that transferring files to a CD or device (a hard drive could be taken into consideration here) is not a legal issue for the RIAA. That kind of goes against their viewpoint within the chart there, though I wonder how they would actually handle offline swapping.
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fogbugzd (profile), 27 Jul 2012 @ 9:13am

Re: Cyber-Lockers account for a tiny fraction.
The problem is that the recording industry is still in hard-core denial. They have lied about the problem for so long that the lie is now ingrained into corporate culture. You don't get promoted to a decision-making position unless you are loyal to the company line that says the only reason that the music industry is in trouble is because of piracy, and if we could roll back the clock to 1985 then everything would be peachy-keen again.

I would like to know one additional detail about the NPD staffer who prepared the report and the RIAA executive who commissioned it. Did they get fired or was their career damaged by producing a semi-honest report that did not support the company line? I really hope they both kept their jobs because it would be a glimmer of hope that the industry is finally beginning to understand the real problems.
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Lowestofthekeys (profile), 27 Jul 2012 @ 9:19am

Re: Re: Cyber-Lockers account for a tiny fraction.
What's even more depressing about the RIAA's denial is it spreads to artists.

That letter that a bunch of old school rockers got together and made about enforcing certain aspects of the 2010 Digital Economy Act would seem ridiculous if those rockers actually knew what it would mean for the people.

They're just as bad the RIAA.
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Zakida Paul (profile), 27 Jul 2012 @ 9:22am

Re: Re: Re: Cyber-Lockers account for a tiny fraction.
I wouldn't say they are just as bad. I don't think they decided to write that letter on their own as I think they were probably 'encouraged' by the record labels. It only dawned on me this morning or I would have wrote that comment on the article last night.
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Lowestofthekeys (profile), 27 Jul 2012 @ 9:26am

Re: Re: Re: Re: Cyber-Lockers account for a tiny fraction.
You're probably right, I shouldn't say they're just as bad, but it just seems to me to be an increasing mental pattern with these people that it doesn't matter how the consumer gets screwed, as long as they get paid everything is okay.

With that mentality, they block out other reasons why their revenue streams may be suffering and continue a pattern of ignorance to the real problem.
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gnudist, 27 Jul 2012 @ 9:33am

Re: surprising numbers
#occupysneakernet
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mlang (profile), 27 Jul 2012 @ 9:33am

I think the music industry needs to act responsibly and stop distributing music that can be listened to.

If they fail to take this action against piracy, they are as bad as the pirates themselves and should be sued.

SAY NO TO AUDIBLE MUSIC.
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Anonymous Coward, 27 Jul 2012 @ 9:48am

Re: So what now?
roll over the 4th Amendment

That's already done and with plenty of precedence for the average citizen. One accusation is all it takes, and you are pre-Magna Carta in America. Thanks soccer mom HOA board member tools! They couldn't have done this without your generous support and unswayable gibbering nonsense.
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saulgoode (profile), 27 Jul 2012 @ 9:51am

Since the RIAA claims that online music piracy is costing $12.5 billion annually and that is less than one fifth of total music piracy, the industry must be losing over $65 billion per year to piracy -- a mighty impressive feat for a $25 billion industry.
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Anonymous Coward, 27 Jul 2012 @ 9:56am

Re: Is it just me, or....
streaming and licensing

Oh, those are are the consumer-only licenses. They don't count because the spreadsheets are too hard and its not like it was in the 1970's. It's Internet nickels anyway and we need congress to make those numbers look real to us. Oh, and if they were "real" licenses the artists would have to be paid, silly-pirate-billy.

Sarcoff
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Ninja (profile), 27 Jul 2012 @ 9:59am

They kept it confidential because it will cause the predicted reaction of ppl asking: if most of it is done offline then why the fuck all those draconian laws to deal with online sharing?

I'd guess they won't do a thing about the offline world because it's been established (judicially inclusive) that cassetes/taps/blank cds/dvds are ok. I can see them lobbying for some sort of levy on all digital devices that can play content (yes, that broad and ridiculous) but I doubt they'll try to outlaw these types of offline sharing or enforce such a thing. Their images are already heavily damaged and this would be much worse than going after file sharers in terms of public reaction.
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L.A.B, 27 Jul 2012 @ 9:59am

Re: Is it just me, or....
"does the fact that this leaves out streaming and licensing as music acquisition' in order to bolster the Unpaid numbers?"

Well played sir. I mostly listen to streaming radio nowadays. I think that Rhapsody (etc all) really is where this is heading anyway, especially for me. Those services have the licensing built into the business model. I bought one physical cd retail last year, prob about 7 to 10 downloaded. I listened to a myriad of new music (new to me) through subscription services
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Anonymous Coward, 27 Jul 2012 @ 10:04am

more than anything, this shows what lies and bull shit the RIAA and other sections of the entertainment industries have told for decades but even worse, how stupid our politicians actually are for believing, even when 'encouraged' to do so, these lies. there has been so much evidence disputing everything the industries have said but it has always been ignored. i hope now that there are some serious questions asked in the various governments as to why there wasn't more notice taken of the public side of things and that there will be some severe butt kicking at the very minimum!
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Brendy, 27 Jul 2012 @ 10:05am

Re: The only stat that the RIAA will pay attention to
It's actually the other way around, which I find EXTREMELY had to believe. There is no way that 65% of music is obtained illegally. Most people I have encountered in my experience use iTunes or still buy CDs because they say, "It's just easier." There is no way 65% are sharing their music. My parents are in their 50's and don't know how to burn a CD let alone use a torrent site. There are a lot of other people in their generation with the same disability. This leads me to conclude that there is no way these stats are accurate.
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Anonymous Coward, 27 Jul 2012 @ 10:23am

By Punishment of Death,
new laws will require all devices to include MAFIAA filters (which will be illegal to bypass) and only MAFIAA approved devices will allowed to be possessed by anyone.

The MAFIAA will then have humming, writing, spoken words and gestures outlawed.

Either that or we kill the evil bastards now.
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MrWilson, 27 Jul 2012 @ 10:29am

Re: Re: So what now?
Too late. They've had wet dreams about this for years and have been trying to get it instituted at the borders for a while now.
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jupiterkansas (profile), 27 Jul 2012 @ 10:31am

Re: Re: The only stat that the RIAA will pay attention to
I can easily say that 95% or more of my music was obtained without paying for it, mostly through the public library, and even before there was such a thing as an mp3.

And yet I still pay money for music at about the same rate I have for decades.
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TDR, 27 Jul 2012 @ 10:38am

What's really surprising is that not a single troll or shill has come into this thread to argue with the data presented. Telling, that.
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Anonymous Coward, 27 Jul 2012 @ 10:42am

Re: Re: Re: The only stat that the RIAA will pay attention to
I can easily say that 95% or more of my music was obtained without paying for it, mostly through the public library, and even before there was such a thing as an mp3.

And yet I still pay money for music at about the same rate I have for decades.

See, piracy has been harming the music industry for years. I mean, clearly, otherwise you would have been buying more all this time. Think of all the lost sales!

/troll
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gnudist, 27 Jul 2012 @ 10:47am

Re: By Punishment of Death,
Bad as the MAFIAA is you sound like a nutjob.

Please tell me the killing part wasn't litereal
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fogbugzd (profile), 27 Jul 2012 @ 10:57am

Re: Re: So what now?
Roll over entire bill of rights. Well, that's not quite true. The governmenent does a fair job of defending the parts that have a business model attached. Yes, I am looking at you, Second Amendment.
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Anonymous Coward, 27 Jul 2012 @ 11:00am

The RIAA/MPAA aren't as interested in stopping piracy as much as they try to lead you you to believe. They want to stop competition altogether and person to person distribution channels aren't an efficient means for competitors to distribute their content.
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Milton Freewater, 27 Jul 2012 @ 11:01am

Explaining the chart
These charts only compare percentages of a whole. They don't compare raw numbers or report total numbers of files "acquired."

In other words, they don't say if, say, the 2010 chart splits up a million acquisitions while the 2011 chart splits up a hundred.

If, say, 5,000 P2P acquisitions are replaced by 5,000 songs heard on Spotify, these charts would show that only as a drop in total P2P acquisitions with no rise anywhere else ... so every other categories' percentage would go up even if their raw numbers didn't.
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Anonymous Coward, 27 Jul 2012 @ 11:28am

You have to be a bit daft not to see the problem:

P2P is the same size of an industry as CD sales. Considering that recorded music sales are down about 50%, it's pretty easy to draw come basic conclusions.

It should also be noted that the drop in P2P from 2010 to 2011 is a pretty good indication of a shift in the public's methods for obtaining the material, and that paid downloads were increasing at that time frame.

Ripping and burning is old hat, call it Mix Tapes or what have you, and you have the same issue.
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The eejit (profile), 27 Jul 2012 @ 12:11pm

Re: Re: So what now?
"Everybody lies."
-Gregory House, House
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Anonymous Coward, 27 Jul 2012 @ 12:16pm

I think they underestimate hard drive trading myself. On campuses the internet is too slow and terrabyte drives too cheap to do it any other way. With USB 3.0 coming on and with USB flash sticks getting massive, as well, nobody is looking to trade 'a song' or 'a movie' any more. Now it is the 'complete zombie edition' or the 'complete 1950's sci fi saga' that folks are trading. In a year it will be the complete 1990's release..
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Christopher (profile), 27 Jul 2012 @ 12:28pm

Re: Re: Re: So what now?
Good point, however with the border searches they are on 'firm ground' because federal law says that you can be searched (even strip-searched) after crossing the border for any reason and even without a reason.

Which is insane and something the Supreme Court should take up, but they have been exceptionally reticent to do that.
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Anonymous Coward, 27 Jul 2012 @ 12:33pm

Re:
I can see them lobbying for some sort of levy on all digital devices that can play content (yes, that broad and ridiculous)....
Sorry, the MAFIAA's already had carnal relations with that particular sheep: Private Copying Levies
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Anonymous Coward, 27 Jul 2012 @ 3:01pm

Re: Re: By Punishment of Death,
You sound like just another dumb sucker or a MAFIAA troll.
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Anonymous Coward, 27 Jul 2012 @ 3:07pm

DRM on hard drives, we come so close
We should all be thankful to recently departed Andre Hedrick, who fought against the media / content industry's efforts to impose DRM on our hard drives.

May his soul rest in peace. His memorial is being held this very day.

Background at
http://www.theregister.co.uk/2012/07/26/andre_hedrick/
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John Fenderson (profile), 27 Jul 2012 @ 3:32pm

Re: Re: Re: So what now?
Yeah, I always look to deranged, dangerous drug addicts for universal wisdom.
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John Fenderson (profile), 27 Jul 2012 @ 3:36pm

Re: surprising numbers
Maybe it's all the rhetoric from the content industry that everyone is going broke, but I would have though that P2P and cyber lockers would make up a larger part of the illicit music sharing world.

It's because that's where all their focus is.

The difference between reality and their rhetoric is a strong indicator not that they are delusional, but that their real concern is not actually about piracy.

Their real concern is that they are losing the monopoly they had over the means of distribution. They couldn't care less about copying -- but they care quite a lot about artists being able to market their art without having to cut the labels/studios in.
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PaulT (profile), 28 Jul 2012 @ 12:00am

Re: Re: The only stat that the RIAA will pay attention to
"Most people I have encountered in my experience use iTunes or still buy CDs because they say, "It's just easier.""

My biggest selling point for getting people to use Spotify instead of pirating was simply "it's easier". You can be streaming the song you want before your torrent file has found its seeds. Some in the industry still consider Spotify to be the next big evil that has to be destroyed, though...
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Anonymous Coward, 28 Jul 2012 @ 5:08am

Re: Eating Your Coffee Beans, Throwing Away The Liquid
Then it would take even longer for bands to recoup. All that extra marketing expense.
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Anonymous Coward, 28 Jul 2012 @ 9:06am

Re: Re: Re: Re: So what now?
Except border crossing is a joke.. When I was truck driving a few years back I use to go into Mexico all the time.
Every time I did I would buy me a handful of Oxys and Somas.

Even worse I kept them in my pill bottle in my shirts front pocket. To give them some credit I did put them in a forged bottle for a prescription of Oxys and Somas that did match the brand.

Even if the pharmacy was called they would never give out personal information without a warrant or consent. It's too big of a lawsuit to risk having smacked down on their asses for screwing up.

That's why I put them right in plain sight. Sometimes the hardest thing to pick up on is right in front of you. For that reason it makes it so easy to overlook.

I'm party on the weekend now lol.. I guess it's a step up from needing handfuls of pills just to get out of bed.
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Anonymous Coward, 28 Jul 2012 @ 9:32am

Not about on-line file sharing per se
The RIAA's position on on-line file sharing, either P2P or via locker-style sites, really isn't about dramatically impacing the music sharing numbers directly. It is about being visible and vocal about "music piracy". I think they're simply trying to show people that illegaly distributing copyrighted music is evil and will be punished. On-line infringers are simply convenient examples to hold up before the public and flog in the name of spectacle. It's like TV advertising. An advertising campaign doesn't necessarily increase product sales so much as keep people on-board with the brand be reminding them it exists in a very visible way. Same with the RIAA. "We exist, and we're coming for you, you illegal trolls!"
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TtfnJohn (profile), 28 Jul 2012 @ 8:24pm

Re: Re: So what now?
As the first English settlers brought Magna Carta with them will that mean they'll go back to England and leave them Magna Carta-less too? :)
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