Computer store shelves overflow with blank CDs; hard drives bulge at the seams with thousands of pirated songs, movies and software programs; media junkies swap all forms of electronic media like candy after a night of trick-or-treating on Halloween; and record companies fume about the lost profits that this rampant file sharing represents. The battle between record companies and fans of free music is nothing new — Napster was forcefully dismantled years ago, but derivative programs like Kazaa and Soulseek quickly sprung up to replace it. What’s new, however, is punishment that flows both ways between file sharers and the record companies from which they steal.
Guardian
Exhibit A: the N.E.T. Act. “”N.E.T.”” cutely and odiously stands for No Electronic Theft. Signed in 1997 by former President Bill Clinton, this act makes felons out of those found guilty of reproducing or distributing copyrighted works without permission. Until now, this law has been, for the most part, ignored — but thanks to a letter written by a group of congressmen (including California Senator Dianne Feinstein) to Attorney General John Ashcroft, that’s about to change.
While before, swapping files on Kazaa only presumably landed you in the ninth circle of Hell, the N.E.T. Act will net you a year in prison if the files swapped are worth the equivalent of $1,000 cash, or five years if that cash amount tops $2,500. But here’s the real kicker: Sharing even one music file on a file-trading network (in the expectation that others will return the favor) will net you that full five years in the slammer, at least in theory. To “”duck a conviction,”” says Polk Wagner, assistant professor at the University of Pennsylvania Law School, “”you’d have to, in essence, prove you were an idiot. Not a problem for some, but a big problem for most file-sharers, I suspect.””
Net-junkies, you knew this was coming. The music industry has been whining about decreased profits ever since Napster and its descendants became popular, despite any real drop in profits. Not that this whining is totally unjustified, but it is presumptuous for record companies to say that a downloaded song represents a lost sale, and often spawns the argument from bitter filesharers that most music being produced today is simply not worth buying — downloading for free and scrapping after a few listens, perhaps, but not buying.
But what’s new and heartening to the millions of music fans who scorn the high price of recorded music, is the Compact Disc Minimum Advertised Price Antitrust Litigation. An article about this was included in the Jan. 30 issue of the Guardian.
According to its Web site, http://www.musicdiscsettlement.com, this little gem is “”a proposed settlement of lawsuits brought by Attorneys General of 43 states, Commonwealths and Territories”” who allege that record labels and music stores violated federal and state antitrust laws by overcharging consumers for recorded music (CDs, cassettes and vinyl) by a total of $500 million. Consumers who were gouged by this unfair pricing can file claims through the Web site, which estimates the future settlements to be between $5 and $20 per person. That’s not much money, of course, but it’s surely a start.
So there’s an interesting duality happening — on one side, there’s the widespread refunding of money to consumers because record companies overcharged for CDs, and on the other side, there’s the prosecution of peer-to-peer network users for robbery. This is payback time for the record companies: Consumers are responding to these inflated CD prices by downloading music en masse and taking back the half-billion dollars the record companies stole from them in the first place.
Failing to see this, of course, record companies continue to seek prosecution for consumers who have avoided buying their overpriced albums. Take a hint, record companies: There is a connection between $17.99 albums and the incredible appeal of obtaining this same music freely and illegally.
Here’s an idea: Let’s make everything even by the simultaneous abandonment of settlements for overpriced music and prosecutions under the N.E.T. Act, and because both sides have broken their share of laws. Then, if record companies have any sense, they will make the necessary adjustments to keep consumers from taking their business elsewhere (like to Kazaa and other peer-to-peer networks), namely, by lowering the cost and increasing the quality of the albums they produce.
Perhaps this sounds unfair to record companies, but they do, after all, rely on concert ticket sales, not album sales, for the majority of their profits — and concert attendance has been rising. And, as subversive as it is, peer-to-peer file sharing will never disappear, and record companies would be wise to begin viewing it as a market force rather than a crime. Peer-to-peer networks do have their advantages, after all, since nothing beats them as a way to market and promote music and to educate music fans about newly produced music (just like MTV and VH1 do, and record companies love them for it).
And we mustn’t forget that the music industry is a free market. Like any other company, record companies and music stores must earn continued success by striking a balance between value and price. Prosecuting file sharers may be warranted, but it’s a sure-fire way to alienate a huge number of potential customers and to keep them from ever buying music again.
So what do record companies value more: making an example out of egregious file sharers by throwing them in jail, alienating millions of music fans in the process, or letting their petty crimes slide and working a little harder to give consumers truly good reasons to fork over cash for their product? Have faith, record companies, that consumers will forever be willing to pay good money for quality music — it’s only when albums cost nearly $20 and are 80 percent filler that things get ridiculous and illegal file sharing becomes rampant.
