Another Scheme

Ole sent me this link and asked for my thoughts. This was my reply: (((not much new there, if you read this diary)))

1) Production equipment is cheap. – FALSE
– a great microphone still costs a few thousand dollars and to record a whole band you need a lot of microphones
– with each good mic you also need good mic pre-amps – those can also easily run in the multiple thousands
– if you have good microphones and pre-amps you still need good digital-to-analog converters

2) One can make a good recording in a basement or bedroom – FALSE
– that can be true for people who use only digital inputs… e.g. synthesizers, loops, techno music…
– one can record good music in a bedroom, but it will rarely SOUND great
– a real studio has real wiring (and an isolation transformer for clean juice) with a great sounding room

3) RE file-sharing: the cat is out of the bag… nothing we can do about it – FALSE
It seems to me that is like saying there is looting and pillaging in the streets –
A) let’s join them, ’cause everyone is doing it
B) let’s make looting and pillaging legal, because we don’t know how to stop it

I don’t like anything about the proposal you linked to. It would mean that the music becomes free after the initial pot is filled. What if the music becomes popular and movies and commercials start using it, and most importantly what if I don’t want people to have free music – after all I don’t want free bagels from my baker. Music has intrinsic value – years of practicing one’s instrument, years of accumulated experience PLUS the value of the other musicians, the studio, engineer…

Yes, there are one or two bands that were able to make money buy giving away music… again, that’s the exception and not the rule. Just like claiming recording is cheap or bedrooms make good studios. Its nonsense.

It looks quite possible that as a culture we could lose something I find very valuable, and that is professional musicians and professional photographers, people who can live and breath their art 24/7. Instead we may eventually have amateurs piling loops from garbage band on top of one another – sorry, I mean garage band of course – and believing that they are making music. Society will be poorer for it.

I believe there are two ways forward. One possibility is an ISP tax (maybe combined with a hardware tax) that collects money to be given to musicians and composers via the performing rights groups, e.g. BMI and ASCAP – we have been doing this with radio successfully since the thirties.

The other option is to come up with a music file DRM that ties the music to the customer and not to a particular brand (e.g. Sony, Micro$oft or Apple) or machine. Advantages: the customer can listen to the music on any machine (computer, phone, ipod whatever) and one could even set it up so that the customer can “sign out” of the file and sell it or give it away to another person – who then has to “sign in” to activate the music.

The biggest mistake of the major labels and the RIAA was not to hire a bunch of great programmers and come up with their own DRM. Instead they allowed many digitial distributors to create their own files, which meant that Apple files did not play on Zune etc. Basically the labels gave away control of the medium and while they manufactured LPs, music cassettes and CDs themselves, they had no control over digital music files.

Sure, hackers and bored kids will unlock the files, but that percentage might not be much larger than the CDs that used to “fall” off the loading dock.

I also think that copyright has to be changed. Not 100 years, not even 75 years. Maybe 25 years, but with strict government enforcement. Hold Ebay responsible for every russian pirate CD they sell, hold Rapidshare responsible for every copyrighted file being shared, hold YouTube responsible for any copyright infringement.

(((PS: when we order CDs from our manufacturer we have to fill out a dozen pages of information that is required by law and is there for the manufacturer’s protection. Among other info we have to state the name of every song and that we own the copyright. That kind of information should be required for every Ebay/RapidShare/YouTube transaction/upload. When you buy a car you want the seller’s personal guaranty that the car belongs to her/him, yes?)))

Ideas and Music

Some Saturday morning thoughts from an early walk to coffee (((It’s A Grind on Cedar Street)))…

The other day I quoted George Bernard Shaw and compared his apples to CDs and his ideas to mp3 files. You might think, if sharing ideas is good, how could sharing music be bad.

Idea ≠ Idea. It occurred to me that there are many types of ideas. Take John Doe, for example. As an employee of software corporation XYZ (or a hardware manufacturer or even a bakery with a great recipe, handed down for generations…) his daytime work-related ideas belong to XYC and are proprietary. They belong to XYZ and will be used, sold or traded at XYZ management’s discretion. At night John Doe works on Linux software, ideas that he happily shares with all. Of course John also has private ideas, that neither belong to his employer, nor would he want to give them away. So, in this example we have three types of ideas: proprietary, freely shared and private. Of those three types of ideas John Doe only has control over two, because the third belongs to his employer.

Now we can apply this to music files:
1. Proprietary files – music that is to be licensed, sold or rented
2. Shared files – music that can be freely copied and shared
3. Private files – maybe encrypted or otherwise hidden from the world

What would happen to XYC, or many other businesses founded on proprietary ideas and information, if they were unable to control their ideas? One either offers a better product or a cheaper product – and both of those choices may depend on having better ideas or information than one’s competitor.

It seems to me that while a ISP music-tax (see this and this) could work, no real attempt at creating a sensible digital rights management system has been made, a DRM that allows the content owner to decide whether the music is proprietary (i.e. licensing, sale or rent), shared or private. What we don’t want is to have the music we purchase be tethered to a specific device. A music file should play on all of our devices, whether phone or computer and across different brands. If a file was locked to a person instead of a device, then the file could play on any device that person owns. One might even create DRM that allows a person to sign out of ownership and assign the music to another person – to lend someone the music, to give it away, to sell or trade music.

Some people have also suggested creating a type of music file that can be moved around freely, but cannot be copied, or maybe one that can only be copied at a loss of quality. Maybe a development of Fraunhofer’s HD-AAC format? Just like the old days when one would borrow a CD from a friend to record it on cassette…

I think too many companies are indirectly profiting from content sharing: the computer manufacturers (rip, mix and burn!), the file-share servers (e.g. rapishare) who get people to look at their advertising, the social web sites that are practically founded on free content (either given freely by musicians hoping to find a market, or shared between members of the web site)… in other words, much of the appeal (((and the profit!))) of the internet has come from freely given and stolen content. I mean, how many web sites have you seen where somebody takes (((steals))) copyrighted images from photographers or other artists and then shows their “selection” with lots of Google ads in the side-bar…

In other words, a reasonable and worthwhile DRM will not likely be created by any of the companies that are making money off of the current arrangement. Apple will not create a new type of DRM file that people can play on a Zune for example. What I absolutely cannot understand is why the record companies or the RIAA have not hired a lot of bright minds to come up with a new standard that works for everyone. In my humble opinion that would be a lot more productive than what they are doing…

In any case, we all know that there are many different types of ideas, some should be shouted from the rooftops, others need to be whispered in a dark room.


A VC: Something Important Is On The Horizon In The Music Business
Here’s what we need. We need someone to create an easy to search streamable library of all the recorded music in the world. We need to be able to grab a track and embed it on our blog. We need to be able to see how many people played it. We need others to be able to crawl these user pages with the embedded music and create algorithms based on who posted it, how often it was played, and how often it was reblogged and linked to. The services that do all of that need to be able to play the music that flows out of these social algorithms in the same way. This all has to be licensed and legal and it has to result in money flowing to the artists. If you put the music on your blog, you should have two choices. Allow the ads to be served into your music or your page or both by the service you got the music from. Or deal with the monetization yourself and pay the royalties you owe. Most people will do the former but some will do that latter.
(Via Vedana)

The Royalty Scam

The Royalty Scam – New York Times
The musicians who posted their work on are no different from investors in a start-up enterprise. Their investment is the content provided for free while the site has no liquid assets. Now that the business has reaped huge benefits, surely they deserve a dividend.

Good article by Billy Bragg in the New York Times. Also see this blog on CNET, which carries the following quote by Nick Carr at Rough Type:

“Exploitation is exploitation, no matter how lovingly it’s wrapped in neo-hippie technobabble about virtual communities, social production, and the gift economy.”

Music Industry Proposes a Piracy Surcharge on ISPs

Music Industry Proposes a Piracy Surcharge on ISPs
The music industry is seriously proposing that ISPs levy a copyright surcharge to compensate artists for tunes traded online. The idea isn’t new, but it is finally gaining traction. Consultant Jim Griffin, the plan’s chief cheerleader, will discuss the idea at SXSW on Friday.
(Via Wired News)

We have discussed this here and here and here and here.

As you know, if you read this journal, I have come to the conclusion that an ISP tax makes a lot of sense. Depending on how this ISP tax is structured music could be free. Free as the Air we breath. Some friends have argued that if music is free how will its value be perceived. That would certainly merit study in terms of Cultural Evolution. Do we value air less because it is free? Sometimes I get the sense that life is one giant experiment. At the sharp edge of this experiment is advancing, or maybe it’s better to say contributing to, the genetic and cultural evolution in some form. At the very blunt edge is comfort, wealth or fame, which become more meaningless as we get older.

Anyway, I would find it very interesting for music to become free to download and free to listen to and free to carry around. What will happen? Already kids in every part of the world can hear what kind of music they make over here and over there – if they can afford it… What happens if any child can listen to any music from anywhere, because it is free – as long as somebody pays the ISP bill, of course. How will that change cultural evolution?

P2P Users Would Stop if Warned by ISP

Slashdot | 70% of P2P Users Would Stop if Warned by ISP
As the UK considers a three strikes policy to fight copyright infringement, a new survey reports that 70% of UK broadband users would stop using P2P if they received a warning from their ISP. ‘Wiggin commissioned the 2008 Digital Entertainment Survey, which found that 70 percent of all people polled said they would stop illegally sharing files if their ISP notified them in some way that it had detected the practice. When broken down by age group, an unexpected trend emerges: teenagers are generally more likely to change their behavior than older Internet users.’