Effects of Piracy on Music Sales Exaggerated

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jacktheexcynic
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/02 20:06:42 (permalink)
ORIGINAL: yep
ORIGINAL: jacktheexcynic
ORIGINAL: yep
And a "car duplicating" machine is not a very good analogy.


and neither is stealing cars and downloading music.

No, "stealing" cars is not analogous to "downloading" music, but it *is* analogous to *stealing* music. It's still taking something that doesn't belong to you.


it is not analogous to downloading music and either (a) paying for it later or (b) not paying for it. stealing is stealing, no argument there, but unless there's a court case out there where a judge found a defendant guilty of theft because they downloaded music from a source unauthorized by the copyright holder, then legally it isn't theft. it is either fair use or it isn't and that hasn't been determined yet. when it is, i'm sure that the justice system will side with the copyright holder and i hope that's the lesser of two evils in the long run.

morally, not paying to own music is stealing. however, the copyright holder's claims on distribution are restricted by fair use, which is pretty vague. that is why i brought up intent on the moral side of this issue. personally, because of this discussion, i'm going to try other options than downloading to "preview" music before i decide to own it.

Drawing distictions that this thing is okay to steal because it's a digital file while this one is not because it's a physical object or whatever is no different from what every other thief does. Car theives rationalize that insurance pays for it or whatever. All theives think that the "real" bad guys are someone else, and you could fill a phone book with all of the reasons why what they do isn't really stealing, or why it doesn't really hurt anyone, or why it's actually good in some way, or whatever.

I know someone's going to jump in and start arguing why their rationalizations are better and different than other theives, but who are you trying to convince?

*All* criminals *love* the opportunity to explain why what *they* do isn't actually wrong or bad. And a lot of them have some pretty good explanations, too-- they put a lot of thought and energy into their elaborate justifications. But the truth is simple-- don't take stuff that doesn't belong to you. It's just the rationalizations that make it seem complicated.


there are people who intend to pay for music they own and people who do not. to me the line between borrowing music and paying for it and downloading it and paying for it is pretty fuzzy, legally and morally. this conversation has convinced me to move away from the line, but i'm not going to judge people who pay for the music they own, whether they download it first or not. i also don't judge people who drive over the speed limit, roll through stop signs, run yellow lights or fail to signal lane changes when no one is around.

- jack the ex-cynic
jacktheexcynic
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/02 20:23:07 (permalink)
ORIGINAL: droddey
50 years from now, society will look back on these days and say what idiots and dinosaurs the music and movie labels are, just like i'm sure people looked back on those who protested the evil invention of the car and its effect on the horse and buggy industry, etc.


The automotive industry didn't win by encouraging people to steal from the horse and buggy makers. They won by providing a better product. Stealing stuff isn't a better product. 50 years from now, people may well look back at this as the point in time at which it started to become impossible to be a professional in any sort of intellectual property business and the entire society took a huge step backwards from the principles of capitalism, to their detriment.


the internet has changed the distribution model for intellectual property in a way so fundamentally bigger than horse and buggy to car that i regret making the comparison. the point is though that you can either accept this change (which some companies are, slowly) or be like the RIAA and fight it tooth and nail. the change, for good or ill, has made the value of digital media drop by an order of magnitude, but the prices have been pretty slow in catching up.

here's what would really happen - the kids would go into your store, buy one pair of everything, and then copy them at home and sell them dirt cheap. your store, not being clever enough to obtain a copying device, would go out of business and when it did and people finally got tired of last year's jeans for $3 a pop,


Because someone has to put in the time and money to create the things you are copying. That's what you don't seem to get. Products with value don't just appear magically. Someone has to create them. When you copy and distribute them, you dilute their value and this is stealing from the people who put in the money and time to create them. That's why copyright law explicitly deals with the right to control copying and distribution, because without it people who create IP do not have the basic rights that everyone else would have when they create a product and go into business to sell it.


i'm not arguing that the creators of artistic works should go unpaid, it's been my position from the beginning that they should. what i am saying is that technology significantly lowers the value of the copies of those works. 10 songs aren't worth $17 anymore, and flagging CD sales are proof of that. but if it gives you some sense of moral superiority, feel free to think that there's been a quantum leap in the number of people who think owning copies of music for free is ethical.

- jack the ex-cynic
jacktheexcynic
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/02 21:12:26 (permalink)
ORIGINAL: nick8004
here's what would really happen - the kids would go into your store, buy one pair of everything, and then copy them at home and sell them dirt cheap.



No, they wouldn't. First of all, the kids aren't copying the products so they can go into business for themselves (which takes a certain amount of ambition and savvy, even if you have no product costs). Second, what incentive would there be for the kids to buy copies, even dirt-cheap ones, when they can just copy the jeans (or whatever) from their friends at virtually no cost or effort?


maybe their friends can't afford designer jeans, or they'd rather not copy a used pair. and just because the kids are thieves doesn't mean they are stupid.

your store, not being clever enough to obtain a copying device, would go out of business


It wouldn't be an issue of cleverness. Using the ray gun to copy commercially available products would be illegal. You put a lot of energy into presenting quality products to the public for what you consider a fair price, and you feel that you, as well as the designers, deserve to make a living at what you do. And if people think your products are too expensive, they have the option to shop elsewhere.


once the "ray gun" gets into the hands of legitimate manufacturers of the jeans, the price goes down anyway, because all it takes is one designer to realize they can sell more jeans for less money to force the rest to do the same.

and when it did and people finally got tired of last year's jeans for $3 a pop, the kids would go looking for new designs.


Might not even take a year. When the kids saw something that looked even slightly novel, they'd copy it to have it on hand "just in case." They'd only be limited by the size of their closets (which, for purposes of this analogy, would be the size of Buckingham Palace ;-)).


but that doesn't matter, because distributors need buyers. do you buy your jeans from kids on the street? neither do most people. and most people see p2p programs as a giant public library, not a store giving away product. they still buy music, and people would still buy jeans from real department stores, provided the prices of the newly devalued products are even close to reasonable.

the designers of the jeans would keep them locked away and charge the kids to go in with the ray guns to copy the jeans.


They'd have the same problem as your store; once you let in a few copyers, they start to share with all their friends and the next thing you know your market vanishes. The only ones buying are the ones who acknowledge the law and choose to purchase on moral grounds, i.e., a small minority.


the small minority is where you are wrong. if you need proof, consider that most music has been available for free and this has been general public knowledge for several years now. and yet people are still buying CDs, going to concerts, buying silly band t-shirts, and paying for crippled, reduced-quality DRM-restricted music. some of that can be attributed to the RIAAs rampage against its own customers but i'll bet a similar number of people got into pirating for the same reason.

they would haggle over prices until both parties were satisfied and commerce continues, only with vastly cheaper jeans.


Why do you think people who can obtain products at virtually no cost or effort, and who apparently are not concerned with prickly issues of legality, are willing to pay *any* price, even a dirt-cheap one? I buy songs from iTunes; I think $1 per song is pretty reasonable. But let's say, objectively speaking, this is too high a price, so Apple lowers it to $.25. Do you think the teenager who wants 8,000 songs on his iPod is going to say "wow, Apple is selling songs for a fraction of their original price, now I'll happily pay $2,000 to get my 8,000 songs?"


i don't think that people who steal on principle are going to pay any price, but most people don't steal on principle, and when you lower the price of something more people buy it. there's a point where the price becomes low enough that the additional number of people buying it reduce revenue. slightly above this point is where most vendors try to sell their product, if they can actually make enough to turn a decent profit. the fun part of digital music is that the distribution costs are amazingly cheap. the margins for decent music could be pretty decent.

Let's be real. You'd do everything in your power to restrict the use of such a device, and certainly to prevent it from entering your store.

of course you would, and you would lose,


Perhaps. I understand your point about the current business model being untenable. And I'm not trying to be a defender of corporate greed. My point is to direct this question to the people who think illegal downloading isn't stealing: If you were in the position of the business owner, and people were doing "illegal ray gun copying," would you accept their argument that it's not really stealing because even though you're losing vast amounts of business, your physical inventory is not being diminished? I don't think so.


your point is entirely valid for non-copyright material. however, copyright material is under copyright and fair use law, and fair use trumps copyright. fair use is also extremely vague, to the point of not even making the distinction as to which ends of the spectrum qualify for fair use. if you don't believe me, i think i quoted the law somewhere in this thread.

because someone smarter than you asked the kids where they got their ray gun from and bought one of their own. now they only need to buy one pair of jeans to fill their department store, and they can charge customers $3.50 per pair (the extra 50 cents being the cost of not buying jeans from some kid in the streets).


Again, why would customers pay even $3.50 when they can get it for free with no cost or effort?


see above.

50 years from now, society will look back on these days and say what idiots and dinosaurs the music and movie labels are, just like i'm sure people looked back on those who protested the evil invention of the car and its effect on the horse and buggy industry, etc.

once again, i think owning music without paying for it is wrong. but if albums were $1.70 instead of $17, a lot more music would get sold. that may be a low price point (and i picked it at random), but when you see how little the artists get from a CD sale it makes a lot more sense to cut out the middlemen and lower prices. if i had a band i would just put up mp3s and FLACs on my website and sell them for cheap. if i actually connected with people, which is what music really ought to do, it wouldn't matter that they could find my music on bittorrent, they'd pay anyway.


The issue of fair cost of CDs is a valid one. I have never gone into a retail store and paid $18.99 for a CD; that just seems too high. I'm comfortable with $15, because that's been the cost since CDs first came out in the mid-80's. I can usually find what I want on sale, or find a used copy, for less. Occasionally, I find a gem in the bargain bin for $2 to $4 I'm thrilled.


some people buy CDs on ebay or used CD stores and so forth, there are numerous ways to not pay the sticker price for a CD. and yet, many people still do.

if i connected with enough people i could probably make a decent living off it. i wouldn't be able to demand a wineglass of green m & m's at every concert or wear diamond studded chains, but i could still do what i loved without the 800 pound gorilla music label on my back.


Let's say you're the next Paul McCartney; you post your music, you're selling CDs at $1.70, and they're going like hotcakes. Wow! You can quit your day job; in fact, you have to. You can just do music; a dream come true! Business demand is so much, you have to hire someone just to take orders. There are only so many hours in day; you can't handle all the demands for interviews, press releases, package design for your music, etc. so you hire a manager, a PR agent, graphic designers, and a marketing person. Now you have a legitimate business, so you need input from a lawyer and accountant. Your payroll is now such that you can't sustain the company just on your personal musical output, so you have to release recordings from other groups, requiring hiring of an A&R person and possibly studio costs.

Starting to sound like the 800-pound gorilla, isn't it? ;-)


or you can release your songs (recorded in your project studio) on bittorrent and charge people for the link. they'll pay, because they like you, and your costs for distribution remain the same every month (you pay for the website and the merchant account). you can go on tour and people will show up, because they want to hear you perform. if you want to move into merchandise, well that's another story, because merchandise and intellectual property are two different animals, which no one seems to understand.

with all the middleman fees out of the way, you could probably afford to consult a lawyer the three or four times during your career when someone tries to pass off your music as their own. again, there won't be any diamond studded chains or the summer home in vale (or however it's spelled) but legitimate artists might actually have a chance to get heard without being screwed by the label.

- jack the ex-cynic
droddey
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/02 21:57:34 (permalink)
i'm not arguing that the creators of artistic works should go unpaid, it's been my position from the beginning that they should. what i am saying is that technology significantly lowers the value of the copies of those works. 10 songs aren't worth $17 anymore, and flagging CD sales are proof of that. but if it gives you some sense of moral superiority, feel free to think that there's been a quantum leap in the number of people who think owning copies of music for free is ethical.


Clearly there has been such a leap. The way capitalism works is that you either buy the product or you don't. If you don't, then the makers of those products can adjust their prices if they feel it is appropriate. There's no place in that equation for stealing the product if you don't want think it's worth what the seller is asking. That causes the whole capitalist equation to break down. The seller of the product is not losing sales because people don't want the product, but because people are just stealing it. So the thieves are completely muddying the waters and preventing the normal price/demand cycle from working, and lowering their ethical and moral position in the process.

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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/03 03:19:12 (permalink)
Sony BMG's chief anti-piracy lawyer: "Copying" music you own is "stealing"

From the article
[Richard Gabriel, lead counsel for the record labels] asked if it was wrong for consumers to make copies of music which they have purchased, even just one copy. [Jennifer Pariser, the head of litigation for Sony BMG] replied, "When an individual makes a copy of a song for himself, I suppose we can say he stole a song." Making "a copy" of a purchased song is just "a nice way of saying 'steals just one copy'," she said.

Rather broad definition.


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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/03 09:27:19 (permalink)
ORIGINAL: droddey

i'm not arguing that the creators of artistic works should go unpaid, it's been my position from the beginning that they should. what i am saying is that technology significantly lowers the value of the copies of those works. 10 songs aren't worth $17 anymore, and flagging CD sales are proof of that. but if it gives you some sense of moral superiority, feel free to think that there's been a quantum leap in the number of people who think owning copies of music for free is ethical.


Clearly there has been such a leap. The way capitalism works is that you either buy the product or you don't. If you don't, then the makers of those products can adjust their prices if they feel it is appropriate. There's no place in that equation for stealing the product if you don't want think it's worth what the seller is asking. That causes the whole capitalist equation to break down. The seller of the product is not losing sales because people don't want the product, but because people are just stealing it. So the thieves are completely muddying the waters and preventing the normal price/demand cycle from working, and lowering their ethical and moral position in the process.


digital music totally screws up supply and demand economics by definition because the supply is now infinite. you can make another copy of a file and the original remains intact. record companies have been way too slow to correct their prices because of this and i won't say it caused piracy but it definitely helped it thrive.

this is why you see those shady russian mp3 sites doing so well cause they sell tracks at like 10 cents a pop or whatever. in a free market, buyers need competition to turn to if they feel the price is too high and the record industry has banded together to keep music prices inflated. iTunes is trying to fill this role but they are still at the mercy of the record companies and most people think that a buck a track is still too high.

as an interesting aside to this, radiohead's new album is coming out on the 10th. it's available as a digital download only until sometime next year. if you go to their website to buy the digital version, they allow you to name your own price. you can pay whatever you want for it. it will be interesting to see what the average person pays for it and what people actually think they should be paying for music. (radiohead are releasing this album independently...they would never get away with this experiment if they were releasing it through a label)
post edited by tjw194 - 2007/10/03 09:28:30
yep
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/03 10:25:34 (permalink)

ORIGINAL: jacktheexcynic
...it is not analogous to downloading music and either (a) paying for it later or (b) not paying for it... there are people who intend to pay for music they own and people who do not. to me the line between borrowing music and paying for it and downloading it and paying for it is pretty fuzzy, legally and morally...

What are you talking about and who are you trying to convince?

If you "intend" to pay for a thing, just pay for it and buy it legitimately like everything else. What is the big song and dance with all the nice distinctions about? Retail commerce is usually pretty cut-and-dried. You want a thing, you pay for it, it's yours.

as an interesting aside to this, radiohead's new album is coming out on the 10th. it's available as a digital download only until sometime next year. if you go to their website to buy the digital version, they allow you to name your own price. you can pay whatever you want for it. it will be interesting to see what the average person pays for it and what people actually think they should be paying for music.

This *will* be interesting.

Stephen King did a similar experiment a few years back. IIRC, every month he gave away a new chapter of a serial novel online and asked people to voluntarily send in a dollar if they liked it enough to download the next one. Something like 2 percent of the people who downloaded all the chapters ever paid anything and he canceled the experiment.

I think most people will just take whatever they can get when push comes to shove, and won't think twice about it. And if you press the point with them, they will come up with all kinds of creative and complicated explanations of why it's actually okay.

Cheers.
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/03 10:50:38 (permalink)
Stephen King did a similar experiment a few years back. IIRC, every month he gave away a new chapter of a serial novel online and asked people to voluntarily send in a dollar if they liked it enough to download the next one. Something like 2 percent of the people who downloaded all the chapters ever paid anything and he canceled the experiment.


that's interesting i hadn't heard about that. from looking into it a little the book is called "the plant." the info i found said that the first four episodes cost $1 and the goal they set was 75% of downloaders should pay or they would not continue releasing them. the number of payers hovered around 70 - 80%. Then they increased the price to $2 and made the chapters 2x as long. the percentage of people who paid dropped to like ~45% and they pulled the plug. i just found those numbers from a blog so i'm not sure if they are right or not.
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/03 13:25:59 (permalink)
digital music totally screws up supply and demand economics by definition because the supply is now infinite. you can make another copy of a file and the original remains intact. record companies have been way too slow to correct their prices because of this and i won't say it caused piracy but it definitely helped it thrive.


The price of a CD has dropped dramatically in real terms. The price hasn't changed in absolute dollars a lot since they first came out, but they've not gone up either, while inflation has more doubled since then. So they cost less than half what they did originally in real dollars, while most everthing else has gone up.

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tjw194
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/03 15:39:07 (permalink)

ORIGINAL: droddey

digital music totally screws up supply and demand economics by definition because the supply is now infinite. you can make another copy of a file and the original remains intact. record companies have been way too slow to correct their prices because of this and i won't say it caused piracy but it definitely helped it thrive.


The price of a CD has dropped dramatically in real terms. The price hasn't changed in absolute dollars a lot since they first came out, but they've not gone up either, while inflation has more doubled since then. So they cost less than half what they did originally in real dollars, while most everthing else has gone up.



not everything has been increasing in price. electronics should decrease in cost over time before even bothering to correct for inflation. look at computers, dvd's, dvd players, cd players, computer accessories, CD-Rs. All these things are decreasing in price because the technology improves and production costs decrease. i'm sure the cost of pressing a CD has decreased a lot in the past 25 years. we know first hand that recording costs are waay lower than they've ever been. with the internet, promotion costs are reduced. and if we're talking digital sales, distrubution costs are basically zero. so where are all these savings going?

now, with respect to digital music downloads, the going rate for a track is $1. so to get a CD's worth of music, it costs basically the same whether i buy a 15 track CD from the store or download it from iTunes. but i'm getting a compressed version of the track and no album art, liner notes, etc. the company doesn't have to pay for distrubution or packaging. so how is that fair that it costs the same? the added price comes from the record company's fear that if they release their music digitally, they are going to lose sales when people illegally share it. and they're right. but by keeping the price higher it causes more people to seek out music illegaly.

so the bottom line is both sides deserve a lot of blame for the situation. but as usual its the average consumer who gets screwed. i am not at all being facetious here...i'm honestly asking. do you think that CD's and music downloads are priced fairly?
jacktheexcynic
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/04 19:58:51 (permalink)
ORIGINAL: yep
ORIGINAL: jacktheexcynic
...it is not analogous to downloading music and either (a) paying for it later or (b) not paying for it... there are people who intend to pay for music they own and people who do not. to me the line between borrowing music and paying for it and downloading it and paying for it is pretty fuzzy, legally and morally...

What are you talking about and who are you trying to convince?

If you "intend" to pay for a thing, just pay for it and buy it legitimately like everything else. What is the big song and dance with all the nice distinctions about? Retail commerce is usually pretty cut-and-dried. You want a thing, you pay for it, it's yours.


i'm going to try this one last time, and then i'm done. retail commerce is not the same thing as music distribution. you can't equate buying any retail product with buying music because one falls under copyright law and one doesn't. you don't (legally or morally) have to pay to listen to a particular song in every situation. the issue of music downloading is not clear-cut, morally or legally, and here is why:

1. music falls under copyright law, which has provisions for the copyright holder to dictate distribution and performances.

2. copyright law is trumped by fair use law.

3. fair use law is a set of pretty vague guidelines from which reasonable people could draw more than one conclusion on a number of issues without case law as a precedent.

4. there is as of yet no case law that i'm aware of specific to the act of downloading mp3s from the internet from sources which have not been sanctioned by the copyright holder.

5. personally, i'm more likely to buy music i know i will enjoy and less likely to buy music based on 30-second clips. i'm not going to buy music i've never heard unless i like the artist. so in my particular case (even though i'm going to try music subscription services instead of downloading), downloading increases rather than decreases the chance that i will pay for music, and i think that most copyright holders would agree that getting more money rather than less is favorable to them.

as to some of the arguments presented:

downloading music = stealing cars/jeans/merchandise - it's not the same thing. it's intellectual property versus physical merchandise. even the government realizes it's not the same thing, which is why we have patents and copyrights and fair use. there are no fair use laws for cars or jeans.

it's wrong because you don't have the permission of the copyright holder - the copyright holder can set the terms but they are limited by the scope of copyright law and fair use law, which boils down to case law. so in effect, unless there is legal precedent, i do have the permission of the copyright holder because they can only grant permissions inside the bounds of the law, and those bounds are not clearly delineated.

people will steal music if they think they can get away with it/no one will pay for music if they don't have to - people can steal music and get away with it, and the deterrent of being sued by the RIAA has pretty much left the public consciousness. and yet, music subscription and purchase services are doing well, CDs are still being sold and concerts are still being attended. most people want to support the artists they like, and buy their stuff even though they could easily get it for free. there is a moral incentive to pay for music and most people do to one degree or another.

as an interesting aside to this, radiohead's new album is coming out on the 10th. it's available as a digital download only until sometime next year. if you go to their website to buy the digital version, they allow you to name your own price. you can pay whatever you want for it. it will be interesting to see what the average person pays for it and what people actually think they should be paying for music.

This *will* be interesting.

Stephen King did a similar experiment a few years back. IIRC, every month he gave away a new chapter of a serial novel online and asked people to voluntarily send in a dollar if they liked it enough to download the next one. Something like 2 percent of the people who downloaded all the chapters ever paid anything and he canceled the experiment.

I think most people will just take whatever they can get when push comes to shove, and won't think twice about it. And if you press the point with them, they will come up with all kinds of creative and complicated explanations of why it's actually okay.


people want to pay for goods and services, there is a moral incentive to. however, the thing they are paying for has to have perceived value. for example, i drop by a business and leave a box of donuts in the break room with a sticker on them that says "free". the donuts don't last more than 90 seconds and no one puts down as much as a dime. the next week, i do the same thing, only i leave a sticker that says "$1" and a collection box. in this case, two things are very likely: 1. the donuts will last a long time 2. a very small percentage of people will pay.

now if i'd started the donuts out at $2 and then gone down to $1, i probably would have made more money. i might not have gotten too far at $2 a donut, but when the price goes down people would jump on it. and yes, there would be a couple who would take the donut without paying, and every once in awhile someone would take the collection box, but for the most part, they'd pay. it's economics and human nature (which some say are more or less the same thing).

if the incentives are presented right, people will pay. if you screw up the presentation though, it can do irreparable harm. if i was a radiohead fan, i'd probably put down $10 for their album if i knew it was good and $5 if i didn't (and here i'm pretending that radiohead is a band i am familiar with and enjoy listening to), provided i get CD-quality DRM-free copies. i'll be interested to see how the experiment works - i'd be tempted to start selling the album at say $10 a pop and then 3 months later lower the price to $9, then $8 and so on. the catch is, i would put that information on the site so no one would feel they were getting ripped off.

- jack the ex-cynic
jacktheexcynic
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/04 20:11:09 (permalink)
ORIGINAL: droddey
i'm not arguing that the creators of artistic works should go unpaid, it's been my position from the beginning that they should. what i am saying is that technology significantly lowers the value of the copies of those works. 10 songs aren't worth $17 anymore, and flagging CD sales are proof of that. but if it gives you some sense of moral superiority, feel free to think that there's been a quantum leap in the number of people who think owning copies of music for free is ethical.


Clearly there has been such a leap. The way capitalism works is that you either buy the product or you don't. If you don't, then the makers of those products can adjust their prices if they feel it is appropriate. There's no place in that equation for stealing the product if you don't want think it's worth what the seller is asking. That causes the whole capitalist equation to break down. The seller of the product is not losing sales because people don't want the product, but because people are just stealing it. So the thieves are completely muddying the waters and preventing the normal price/demand cycle from working, and lowering their ethical and moral position in the process.


the sellers are in control of the price. the sellers are the ones who deny their product has lost value. the sellers are preventing the market from working. getting stuff stolen from you is always part of the equation, it's the cost of doing business. most people who steal music probably wouldn't have paid for it anyway - they would just not have listened to those songs, or listened to them on the radio, or borrowed (or copied) a friend's CD. when there is no intent to buy there is no loss of a sale.

- jack the ex-cynic
droddey
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/04 21:16:55 (permalink)
the sellers are in control of the price. the sellers are the ones who deny their product has lost value. the sellers are preventing the market from working.


You have capitalism completely wrong. If the product is overvalued, then someone else will take over the business by providing the product at a lower price. But clearly the products are not overvalued. The music industry doesn't make particularly large profits. As I've pointed out in previous discussions, from what I could figure out the combined GROSS revenues of the 5 major music studios is in the $5B range per year. GE makes that almost much in PROFIT in a year. So if GE is making more profits than the studios make gross, why aren't people out in the street screaming about GE? Because they cannot steal from GE, therefore they need no rationalization to steal from them.

The selling price of a product is driven by the cost to make it, not how much people want to pay, or a combination of those two things with production price providing the absolute bottom line plus profit. People don't get to steal what they think is overvalued. They are supposed to just not accept the product at all, then the market will make the correct as necessary, the Darwinian way.

getting stuff stolen from you is always part of the equation, it's the cost of doing business.


Getting 3% of your product stolen is the cost of doing business (about the average for retail stores.) Having 10 or 20 times as much stolen as sold legitimately is not the cost of doing business.

most people who steal music probably wouldn't have paid for it anyway - they would just not have listened to those songs, or listened to them on the radio, or borrowed (or copied) a friend's CD. when there is no intent to buy there is no loss of a sale.


That's a bogus argument. If there were kids walking around with empty iPods because nothing they downloaded was worth keeping to them, maybe you'd have a point, but we know that's not the case.
post edited by droddey - 2007/10/04 21:28:04

Dean Roddey
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/04 22:18:28 (permalink)
yikes!!!

make your own judgement on this story

this verdict just came down and i thought i'd share it in case you guys missed it since it's relevent to the conversation.
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/04 22:18:52 (permalink)
ORIGINAL: droddey
the sellers are in control of the price. the sellers are the ones who deny their product has lost value. the sellers are preventing the market from working.


You have capitalism completely wrong. If the product is overvalued, then someone else will take over the business by providing the product at a lower price. But clearly the products are not overvalued. The music industry doesn't make particularly large profits. As I've pointed out in previous discussions, from what I could figure out the combined GROSS revenues of the 5 major music studios is in the $5B range per year. GE makes that almost much in PROFIT in a year. So if GE is making more profits than the studios make gross, why aren't people out in the street screaming about GE? Because they cannot steal from GE, therefore they need no rationalization to steal from them.


this is my last post to you, so keep that in mind when you reply. it is you who don't understand economics. the barrier to entry in becoming a major label is pretty high, so there's very little in the way of competition, not to mention the big four (or five?) are all members of the RIAA, and if you haven't figured out the RIAA's strategy yet, i'll let you in on a secret - it has nothing to do with finding the fair market value of CDs or music downloads.

your comparison with GE is apples to oranges, they are in entirely different markets. here's a better one - the RIAA labels and microsoft. both sell intellectual property and can rightly be considered monopolies - the RIAA isn't actually guilty of anti-trust but they are attempting to eliminate fair use and they own exclusive rights to a majority of music. both complain ceaselessly about pirates and thieves and both have been known to bully customers who they think are stealing from them (although the RIAA has been more aggressive). so why is microsoft making more money than it knows what to do with? part of it is that they actually pay attention to what their customers want, and although they haven't lowered their prices they have been adding value (compare NT to 2003 or XP, or exchange 5.5 to 2003/2007, and they are even trying to get SMS to work right). the big labels on the other hand, have been turning out worse and worse music, designed to hook people listening to the radio and not much else.

most of the music i have i'll listen to for years to come - the $15 (or $7 on ebay) was well worth it and in all cases i made sure i liked the artist before i plopped down the cash - it's an investment. but the crap on the radio wasn't built to last and yet it costs just as much, plus you get one or two well-done tracks for the price of 10 or more. thats why people are downloading in droves - there's no incentive to pay for the whole CD when it sucks and you can get the two songs you like for $2. the bottom line is that the value of music has gone down because there is a distribution method that is much, much cheaper than buying a CD, and yet the songs still cost the same. in fact, if labels distributed music through bittorrent, they could make the customer pay for distribution (cost of internet connection). the music is out there anyway, so the labels have nothing to lose.

The selling price of a product is driven by the cost to make it, not how much people want to pay, or a combination of those two things with production price providing the absolute bottom line plus profit. People don't get to steal what they think is overvalued. They are supposed to just not accept the product at all, then the market will make the correct as necessary, the Darwinian way.


i'm sure then you'll be able to explain the prices of designer jeans with that argument. the price does have something to do with the cost of making, marketing and distributing it, but in the case of music, the cost of distributing it has fallen to zero (although i have yet to see anyone take advantage of this). which by your own argument, means that the value of music has dropped, unless you are now going to say that the cost of distribution doesn't factor in. and by the way, an increase in piracy would indicate that people aren't accepting the product (i.e., a CD or music download) to the point where they are willing to steal to get it. it's like a black market, only free. this behavior can be corrected for by...lowering prices. and it is the seller who corrects the prices, not the buyer.

getting stuff stolen from you is always part of the equation, it's the cost of doing business.


Getting 3% of your product stolen is the cost of doing business (about the average for retail stores.) Having 10 or 20 times as much stolen as sold legitimately is not the cost of doing business.


when you can prove that (a) your numbers resemble reality and (b) that the people stealing music would have bought it if they couldn't have stolen it, then your argument would be valid. since you can't, it isn't.

most people who steal music probably wouldn't have paid for it anyway - they would just not have listened to those songs, or listened to them on the radio, or borrowed (or copied) a friend's CD. when there is no intent to buy there is no loss of a sale.


That's a bogus argument. If there were kids walking around with empty iPods because nothing they downloaded was worth keeping to them, maybe you'd have a point, but we know that's not the case.


if the only way you could get music on an iPod was stealing, you might have a point, but again, you don't. you can put ripped (as in from a CD you bought) music on an iPod, or you could have purchased some of the 3 billion songs sold on iTunes. granted, over 100 million ipods have been sold, but many people buy more than one.

i'm signing off from this discussion now, since there appears to be nothing new to learn.

- jack the ex-cynic
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/04 22:29:31 (permalink)
ORIGINAL: tjw194
yikes!!!

make your own judgement on this story

this verdict just came down and i thought i'd share it in case you guys missed it since it's relevent to the conversation.


and just when i said i was done with this discussion... well, there's your case law on distributing music - still waiting for the case on downloading it (although with most clients, downloading is distributing as long as you are connected). i would like to see what evidence was provided on the technical side, but i have a feeling it went something like this:

safenet records IPs and timestamps of people distributing music.

safenet goes to ISP, demands records of which IPs were assigned to which users at a certain time, and gets them.

it is shown that the defendant's broadband modem was assigned the IP in question during the time in question.

the important factor is how safenet proves that their IP gathering process is legitimate, and whatever it was, i imagine it went well over the heads of the jury.

this also shows that a randomly selected group of people think that just because music is freely available on the internet, it isn't right to distribute it without permission, which indicates to me at least that we haven't made a quantum leap in justifying thievery.

- jack the ex-cynic
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/04 23:53:29 (permalink)
this is my last post to you, so keep that in mind when you reply. it is you who don't understand economics. the barrier to entry in becoming a major label is pretty high, so there's very little in the way of competition, not to mention the big four (or five?) are all members of the RIAA, and if you haven't figured out the RIAA's strategy yet, i'll let you in on a secret - it has nothing to do with finding the fair market value of CDs or music downloads.


Well, I think you are incorrect on a number of points:

1. Given the arguments you've already made, there would be no real barrier to becoming a major player since you claim that physica distribution is an outdated model. So the big cost of entry (becoming a global production and delivery company) doesn't exist in that world. Anyone can set up to market and distribute people's music on the internet and avail themselves of the advantages that you have argued for. But, no one has done it because I'm sure that they understand that they'd not make enough money to make it worth it. They'd have all of the problems that the big players have now, then some, because they wouldn't even have physical CD sales to help bolster the bottom line.

2. There are plenty of big companies out there who, if you are correct, could steal the market and have plenty of capital to do it. They could set up a purely internet distributed music company. But, I'm sure that they understand the problems as well. Why would they want to build a boat that's already leaking?

3. If the RIAA members were really seriously colluding to keep the prices up, they'd have kept the price in line with inflation instead of letting it fall by more than half in real dollars since CDs came out. They'd have been completely justified since most everything keeps up with the cost of inflation.

4. YOu keep seeming to think that making a new copy of a CD is the real cost of a studio's production, but it's not. It's all the stuff that goes on before the CD is shipped that is costly, and the 80'ish percent failure rate they have because they are not in a business where you can predict what will work and waht won't. That cost doesn't go away just because of the internet, and that's another reason why non one wants to try to take over the music business probably, because having free shipping of the product isn't that panacea that would let them sell the stuff for $1 a CD.
post edited by droddey - 2007/10/05 00:03:08

Dean Roddey
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/04 23:59:07 (permalink)

ORIGINAL: tjw194

yikes!!!

make your own judgement on this story

this verdict just came down and i thought i'd share it in case you guys missed it since it's relevent to the conversation.
Ouch.

I'm not entirely sure I feel *bad* for the woman, per se, but that sure sounds like a stiff penalty.

I'd like to think that maybe something like that might make people reconsider the "okayness" of stealing copyrighted music, but I have a feeling its effect, if anything, might be to make the file-sharers madder and more indignantly self-righteous about their supposed *right* to steal music, although possibly a little more frightened.

I will say that if I were going to prosecute illegal file-swappers (which is generally not something I'm in favor of, opposed as I am to piracy), I think this would be the most effective tack to take. Go after random people who maybe have only a few dozen songs and nail them hard. I suspect that does a better job of upping the fear factor than targeting hardcore download nerds.

the important factor is how safenet proves that their IP gathering process is legitimate, and whatever it was, i imagine it went well over the heads of the jury.

FWIW, in this case, it sounds like the defense did not really even attempt to claim that the files were not from her computer, they instead tried for a defense that it wasn't her, personally, who was the file-swapper. the AP version makes this point a little clearer.
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/05 12:06:02 (permalink)
That sure is a surprising judgement. That should change the opinion of many that think illegal file sharing is legal. And, that also changes the risk vs. benefit decision when considering an illegal download. And, that ought to encourage the record companies to pursue more of these cases.

I'd be interested in how they came up with that amount in the judgement, there was nothing in the article that mentioned punitive damages. They charged $9,250 per each of the 24 songs they focused on totaling $222,000. If you place $1 per song, that implies each song was downloaded 9,250 times from her computer. I wonder how they were able to prove that.

For that woman, that judgement is brutal.
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/05 16:43:22 (permalink)

ORIGINAL: fep


I'd be interested in how they came up with that amount in the judgement, there was nothing in the article that mentioned punitive damages. They charged $9,250 per each of the 24 songs they focused on totaling $222,000. If you place $1 per song, that implies each song was downloaded 9,250 times from her computer. I wonder how they were able to prove that.



the $9250 falls within the range specified by law for a copyright infringement. i don't think it has anything to do with the amount downloads from her shared files. how they came up with that specific number though i have no idea.

that ought to encourage the record companies to pursue more of these cases.


the RIAA has pursued quite a lot of these cases actually. this is just the first one to come to trial. the RIAA usually offers to settle with the defendent for a few thousand bucks and since they stand little chance to win the case, they usually choose the settlement. it's great to fight back and not get bullied by the big guys but it doesn't work out so well if you're guilty. d'oh. for this lady, that was a costly gamble.
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/05 21:04:02 (permalink)
ORIGINAL: yep
I'm not entirely sure I feel *bad* for the woman, per se, but that sure sounds like a stiff penalty.

I'd like to think that maybe something like that might make people reconsider the "okayness" of stealing copyrighted music, but I have a feeling its effect, if anything, might be to make the file-sharers madder and more indignantly self-righteous about their supposed *right* to steal music, although possibly a little more frightened.


stuff like this never ends well for either side. to me, it's the penalty and not the conviction that is the problem. whenever the penalty for something is that out of touch with reality there will be a backlash, whether the verdict was fair or not.

I will say that if I were going to prosecute illegal file-swappers (which is generally not something I'm in favor of, opposed as I am to piracy), I think this would be the most effective tack to take. Go after random people who maybe have only a few dozen songs and nail them hard. I suspect that does a better job of upping the fear factor than targeting hardcore download nerds.


i agree that it is effective in terms of generating fear, although i don't think it is an effective business strategy. fear typically enrages as many people as it cows, and people who otherwise would have bought CDs or downloaded songs will now want fight against the system, and someone will figure out how to combine anonymous networks and peer to peer networks in a way that's dead simple to use.

the important factor is how safenet proves that their IP gathering process is legitimate, and whatever it was, i imagine it went well over the heads of the jury.

FWIW, in this case, it sounds like the defense did not really even attempt to claim that the files were not from her computer, they instead tried for a defense that it wasn't her, personally, who was the file-swapper. the AP version makes this point a little clearer.


then on that front i am in agreement with the verdict. some of my thoughts on the AP article:

"We don't know what happened," Toder told jurors. "All we know is that Jammie Thomas didn't do this."


i would have convicted on this alone. if i were her, i would appeal based on incompetent counsel although that probably wouldn't get very far either.

Thomas' testimony was complicated by the fact that she had replaced her computer's hard drive after the sharing was alleged to have taken place — and later than she said in a deposition before trial.


always a bad move to lie about when you replaced your hard drive after such an incident.

The hard drive in question was not presented at trial by either party, though Thomas used her new one to show the jury how fast it copies songs from CDs. That was an effort to counter an industry witness's assertion that the songs on the old drive got there too fast to have come from CDs she owned — and therefore must have been downloaded illegally.


that is a pretty dumb assertion on the plantiff's part - the hard drive speed is pretty much irrelevant when it comes to ripping CDs. it's processor and CD digital read speed that make the difference, although i think that would definitely go over the heads of the jury.

overall though i hope the RIAA continues to do this sort of thing. it won't stop filesharing but it will expose them as the greedy vermin they are and hopefully drive companies and customers to more enlightened forms of music distribution.

- jack the ex-cynic
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/05 21:32:57 (permalink)
Since when did going after people who steal from you make you a greedy vermin? I kind of thought that is what the courts are for.

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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/05 23:29:22 (permalink)
I really have to congratulate you guys on a very civil & informative (and dogged) conversation.
Please keep up the good work

Thanks

Paul

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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/06 06:46:25 (permalink)
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post edited by Jessie Sammler - 2008/07/10 00:55:45
droddey
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/06 13:48:03 (permalink)
So, let's say that I accidentally let a friend borrow one of my backup copies of a CD that I had purchased legally, then forgot that I'd loaned it to her and, a couple of years later -- having totally forgotten about it -- made another backup copy for my personal use. Well, I think that's illegal, according to the laws. Yet, if the record companies came after me for it, I'd think myself ill-used, and I'd be pissed. (Not that I would ever let anything like that happen; it's purely hypothetical.)


That's not something that they would waste their time on. They are a business, and for a business it makes no sense to spend a lot of money for little return. Busting people who are sharing files makes sense, because it's hopefully helping to reduce the amount of file sharing . Busting someone for something like that wouled be a waste of time and money. It's no different from what went on in the VCR days, and they knew that it was going on, but that level of 'sharing' isn't dangerous in the way that file sharing is.

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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/06 18:34:06 (permalink)
ORIGINAL: Jessie Sammler
So, let's say that I accidentally let a friend borrow one of my backup copies of a CD that I had purchased legally, then forgot that I'd loaned it to her and, a couple of years later -- having totally forgotten about it -- made another backup copy for my personal use. Well, I think that's illegal, according to the laws. Yet, if the record companies came after me for it, I'd think myself ill-used, and I'd be pissed. (Not that I would ever let anything like that happen; it's purely hypothetical.)


they probably would sue you if they found out - then offer to settle for a few thousand dollars. really, it doesn't matter if you've even done anything, as long as your name ends up on the lawsuit list.

http://www.eff.org/IP/P2P/riaa_at_four.pdf

Just as privacy advocates had feared, however, the lack of judicial oversight in the subpoena process resulted in abuses. For example, Sarah Ward, a grandmother living in Massachusetts, found herself among the 261 accused. She was innocent - a Macintosh user who had been accused of using the Windows-only Kazaa to download hard-core rap music. Although the RIAA ultimately withdrew the lawsuit against her, in the words of an RIAA spokesperson, "When you go fishing with a driftnet, sometimes you catch a dolphin."

...

Or take the case of Cecilia Gonzalez, a recently laid-off mother of five, who owes five major record companies a total of $22,500 for illegally downloading off the Internet. That ís more than three-fourths of what she made the previous year as a secretary. Ironically, Gonzalez primarily downloaded songs she already owned on CD - the downloads were meant to help her avoid the labor of manually loading the 250 CDs she owns onto her computer. In fact, the record companies are going after a steady customer - Gonzalez and her husband spent about $30 per month on CDs. Nevertheless, the RIAA insisted that it would not consider a settlement for less than $3000, an amount that would bankrupt the Gonzalez family.

Gonzalez is not the only good customer the RIAA has chosen to alienate. The organization recently targeted a fully disabled widow and veteran for downloading over 500 songs she already owned. The veteran's mobility was limited; by downloading the songs onto her computer, she was able to access the music in the room in which she primarily resides. The RIAA offered to settle for $2000 - but only if the veteran provided a wealth of private information regarding her disability and her finances.

...

John Paladuk was an employee of C&N railroad for 36 years and suffered a stroke in 2006 which left his entire left side paralyzed, and severely impaired his speech, leaving him disabled with his disability check as his only source of income. Despite this, the RIAA has filed suit in Michigan against Mr. Paladuk, even though he lived in Florida at the time of the alleged infringement and has no knowledge of file sharing.

The RIAA does not even bother to make sure that its targets are actually current filesharers. One Florida college senior was named in a civil case based on downloads that had occurred two to three years before, from a computer she then shared with her three roommates. The computer is long gone, making any investigation into the circumstances difficult at best. Fearful of leaving college with a damaged credit record, the student believes that she may have no choice but to meet the RIAA's demand.


the RIAA has sued thousands of people who may or may not be guilty of copyright infringement and then offers to settle for a few thousand dollars (less than the cost of an attorney if you happen to be innocent). the average settlement is around $3,000, or 170-180 brand new CDs (not including tax). fortunately, the RIAA has set up a website where you can simply pay them with your credit card. Below, the word "campaign" refers to the RIAA's latest initiative of suing college students.

The campaign has been supplemented with the creation of a new website, http://www.p2plawsuits.com, the latest tool in the RIAA's litigation strategy. At the website, those receiving pre-litigation letters can simply settle their cases by paying the settlement with a credit card, without any aspect of the case ever entering the legal system. This in turn saves the recording industry a substantial sum of money by completely avoiding the costs associated with actually having to file a "John Doe" suit.


but then i suppose this sort of extortion is OK. after all, people are stealing music from them, and since they don't have the resources to sue every filesharer, may as well just make examples out of thousands of (probably) guilty people.

- jack the ex-cynic
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/06 19:18:57 (permalink)
Again, posting stuff like that from the EFF isn't any more balanced than posting stuff from the RIAA. I wouldn't believe either of them on face value.

That ís more than three-fourths of what she made the previous year as a secretary. Ironically, Gonzalez primarily downloaded songs she already owned on CD - the downloads were meant to help her avoid the labor of manually loading the 250 CDs she owns onto her computer.


And this kind of proves it. It would be ten times easier to just throw each of them into J.River or iTunes than it would to find them and download them all online. The ripping requires no manual intervention, just throw a new one in the drive when the previous one is done, and it looks up all the metadata for you. It will clearly take more than a couple hours, but there's no way anyone would find and download 250 CDs worth of files when they could just rip them (at higher quality.)
post edited by droddey - 2007/10/06 19:30:52

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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/06 20:16:40 (permalink)
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post edited by Jessie Sammler - 2008/07/10 00:56:23
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/06 21:39:59 (permalink)
ORIGINAL: Jessie Sammler
Yeah, really. I just put a whole 300-disc CD changer worth of music into iTunes. It took a little effort, but I got consistent, complete rips of every song on every CD that I own. Lawsuits or not, there's no way would I depend on a bunch of faceless wankers on the Internet to do it for me.


downloading requires less effort than ripping from CD, although being recently unemployed i'm sure she had plenty of time on her hands. the point of the story is to show that the RIAA doesn't actually care about its customers (she owned 250 CDs after all), it cares about using fear to make money.

the RIAA has sued thousands of people who may or may not be guilty of copyright infringement and then offers to settle for a few thousand dollars (less than the cost of an attorney if you happen to be innocent). the average settlement is around $3,000, or 170-180 brand new CDs (not including tax). fortunately, the RIAA has set up a website where you can simply pay them with your credit card. Below, the word "campaign" refers to the RIAA's latest initiative of suing college students.
Well, it's clear that the RIAA is intent on making examples out of people and using their lawsuits to strike fear into many, many others whom they're not going to sue -- in an effort to control their behavior indirectly. That's why I wouldn't be surpised if they sued someone, very publicly, over the sort of thing with the CD copying that I, accidentally, hypothetically, have never done.


and given all the people that the RIAA has sued, some of them innocent, and the amount of money they ask as a settlement, and the tactics they use, i stand by my statement that they are greedy vermin. are pirates greedy vermin? sure they are. but let's not pretend that the RIAA is the only victim here.

here are a few links on one particular story where an innocent person was targeted by the RIAA and is now countersuing to reclaim her court costs.

http://www.groklaw.net/articlebasic.php?story=20070625162738896

http://consumerist.com/consumer/worst-company-in-america/interview-with-riaa-lawsuit-target-tanya-andersen-301510.php

http://marketplace.publicradio.org/display/web/2007/09/17/face_music_part1/

here are some nice gems from the third article:

The first lawyer she consulted offered some advice that turned her stomach:

ANDERSEN: "Just let 'em take a judgment against you and file bankruptcy." And I told him, "Why should I have to do that? That's not fair." And he said, "I didn't say it was fair. It's how you have to deal with those people."


Lybeck responded with a counterclaim in the fall of 2005, and Andersen says after that things really got ugly. It was right around the time she moved to a new home, and her apartment manager got a call:

ANDERSEN: He told them he couldn't release my personal information. They told him that he would either give it to them or he was going to get in a lot of trouble. It terrified me. Come to find out, they were trying to serve Kylee.

Her daughter, who was just 7 years old when the file-sharing supposedly happened. Andersen's lawyer says he was able to confirm that call came from the recording industry's law firm. What remains a mystery is something else that he says happened around the same time:

LYBECK: Calls were made to Kylee's elementary school, under the pretext of somebody calling saying they were Kylee's grandmother, and was she there that day? I haven't tracked that call directly back to the law firm, but it was most disturbing, especially since Tanya checked, and grandma made no such calls.


It seemed to make no sense, until he figured out, he says, that the file-sharing account Andersen was accused of using actually belonged to a man almost 200 miles away. Lybeck says it should have been immediately obvious to anyone who bothered to check. He was able to find it out with a simple Google search. And even then, the case dragged on several months more.

LYBECK: It ended when they finally decided that they couldn't keep the charade up any longer. When the federal court forced them to put up or shut up, they quit.

Leaving his client, he says, to deal with tens of thousands of dollars in legal bills. The Electronic Frontier Foundation's Fred Von Lohmann says Andersen is now in the same bind as almost everyone who's challenged the RIAA.


As for the organization's claim that these cases are isolated? On the opposite side of the country, New York City attorney Ray Beckerman runs a website tracking the cases of many defendants who claim their innocence -- including one of his own:

RAY BECKERMAN: I have a client with multiple sclerosis, gets around with an electric wheelchair, has no real understanding of what this is about, had nothing to do with any file-sharing, knows nothing about it. And they will not drop the case against her.


some more from http://www.mp3newswire.net/stories/5002/three_moms.html:

One of the first to suggest EMI, Universal, Warner and Sony BMG were being a little less than forthright in their 'File sharing is costing us billions in lost sales' declarations came from two respected American scholars.

"According to the RIAA (2002), the number of CD’s shipped in the U.S. fell from 940 million to 800 million - or 15% - between 2000 and 2002 (though shipments continued to rise during the first two years of popular file sharing, 1999-2000)," say Felix Oberholzer of the Harvard Business School and Koleman Strumpf of the University of North Carolina at Chapel Hill in their The Effect of File Sharing on Record Sales: An Empirical Analysis.

"The record industry has claimed this decline is due to file sharing."

The two analyzed the direct data of music downloaders over a 17-week period in the fall of 2002, and compared that activity with actual music purchases during that time, coming to the conclusion that spikes in downloading had almost no discernible effect on sales.

Even under the worst-case example, "it would take 5,000 downloads to reduce the sales of an album by one copy," they wrote. "After annualizing, this would imply a yearly sales loss of two million albums, which is virtually rounding error given that 803 million records were sold in 2002. Sales dropped by 139 million albums from 2000 to 2002."

Nor do downloaded mp3 files replace CD buys.

"While downloads occur on a vast scale, most users are likely individuals who would not have bought the album even in the absence of file sharing," stated Oberholzer and Strumpf.

Their studies concentrated on the American experience. But a more recent study by Dr Tatsuo Tanaka of Keio University in Japan, using the now famous Winny p2p application, says there’s, “not sufficient evidence that file sharing systems are responsible for the recent decline in CD sales”.

To the contrary, p2p usage helps in the promotion of music by allowing users to experience it before purchase; and, it helps in the discovery of new music by users, says Tanaka in Does File Sharing Reduce CD Sales?

"Based on micro data of CD sales and numbers of downloads, we found that there is very little evidence that file sharing reduced music CD sales in Japan. We controlled simultaneous bias between sales and downloads by instrumental variables but did not find correlation between CD sales and numbers of downloads. Although there were large differences in the numbers of downloads among CD titles, these differences did not affect CD sales.

"We also carried out a user survey on file sharing and CD purchases with consideration to the potential bias of respondents trying to understate their illegal copying activity. This survey also showed that file sharing had very limited influence on CD purchases."


here's a link to a PDF of a motion filed on behalf of the RIAA, in an attempt to continue their case against a disabled woman:

http://www.ilrweb.com/viewILRPDF.asp?filename=elektra_schwartz_070822RIAAtoMagistrate

here's a link to back up the EFF's quote on the RIAA "catching dolphins":

http://www.post-gazette.com/columnists/20030914edroddy0914p1.asp

but then, i suppose all these sites are just making stuff up.

- jack the ex-cynic
Jessie Sammler
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RE: Effects of Piracy on Music Sales Exaggerated 2007/10/06 22:05:49 (permalink)
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post edited by Jessie Sammler - 2008/07/10 00:57:32
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