September 27, 2004

Missed This Break In The Ranks [8:49 am]

Conservative group savages anti-P2P bill

The American Conservative Union (ACU), which holds influential Republican activists and former senators on its board of directors, is running newspaper and magazine advertisements that take a humorous jab at the so-called Induce Act–and slams some conservative politicians for supporting it.

“This is the Hollywood liberals trying to crush innovation,” said ACU deputy director Stacie Rumenap. “What’s sad is that they’ve got Republicans on their side.” A Senate committee vote on the bill is scheduled for Thursday.

Ernest, of course, has been tracking this very closely; and there’s this today from The Register: Induce Act tweaks fail to stem concern

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The ITMS Royalty Calculation [8:41 am]

Playlist’s That’s The Way The Money Goes references a baffling calculus of artist and producer royalties. The discussion of the article includes a pointer to DownHill Battle’s take in the iTunes Music Store.

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US Copyright Imperialism? [8:28 am]

A question of copyright [via EFF MiniLinks]

It’s fairly obvious from my photo, but I don’t shave. And while I have no intention of reaching for the razor, I was astonished that the Afghan government has felt it appropriate to pass a law prohibiting shaving, and to punish blade-using with severe penalties.

I feel equally aghast at the actions of the US Senate in deciding to ban the creation of technology which ‘induces’ piracy.

To induce (says the creator of the Act) means to intentionally induce someone else to break the copyright laws: “Intent may be shown by acts from which a reasonable person would find intent to induce infringement based upon all relevant information about such acts then reasonably available to the actor, including whether the activity relies on infringement for its commercial viability.”

[...] The thing is, of course, I don’t live in America or Afghanistan. Laws passed in the Afghan theocracy concern me as someone who takes an interest in international affairs, and laws passed in America concern me equally.

But in the normal course of my life, I don’t have to worry about whether I’m transgressing some California statute, nor do I fret about whether trimming my beard short might be regarded as shaving by ‘a reasonable person’ as defined in Afghan law.

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Asking the Ugly Questions About Patents: [8:12 am]

A review of Lerner and Jaffe’s Innovation and Its Discontents: How Our Broken Patent System is Endangering Innovation and Progress, and What To Do About It:Does the Patent System Need an Overhaul?

“Our idea is that three things will potentially make a big difference,” Mr. Lerner said. “First of all, this idea which may well have made sense in 19th century of a patent examiner being able to sit and in few hours figure out what a relevant technology is, and then go out and make a decision as to whether a patent should be granted or not, that really doesn’t make sense in an era like today.

“Second, to see the patent review process as ‘one size fits all’ is again a mistake. There has to be way to figure out how to devote more resources to those patent applications which are really the important ones, and less to the unimportant ones.”

The two professors say one solution is to get more information into the hands of patent examiners.

“Our recommendation is that we create very real incentives to third parties to contribute information to the patent-examining process,” Mr. Lerner said. “There should be one level of review before and after the patent is issued, but within the patent office.”

The authors’ third remedy is to reverse the trend toward jury trials for patent lawsuits.

“Over the last 30 to 40 years, there has been real replacing of judges by juries,” Mr. Lerner said. “Patent disputes by and large tend to be highly technical disputes, and in many cases a lay person without much training in the area is hardly an expert.”

Slashdot: More Calls for Patent Reform

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The Push for Music Subscriptions Is On [8:09 am]

A look at the different business model/fee structure underlying the current subscription model, and the stake that this part of the industry has in Microsoft’s Janus technology: Music Sites Ask, ‘Why Buy If You Can Rent?’ (see also the BBC’s Virgin seeks slice of net music and CNet’s Virgin launches online music service)

Jupiter Research estimates that 2.1 million people pay for music subscription services, including the cheaper Internet radio services. By contrast, 8.5 million people have paid to download a music file. (All of that is still dwarfed by the 23.4 million people who said they downloaded files free from sharing services like Kazaa in the month of July, according to a survey by the NPD Group.)

That track record does not scare Zack Zalon, the president of Virgin Digital. “Two or three years out, subscriptions will overtake à la carte because it is a much more interesting proposition,” Mr. Zalon said. “It has just been difficult to articulate to consumers what it is.”

[...] Mr. Cue said that Apple might consider a subscription service in the future, but it has no plans to do so now. “Customers are speaking loudly with their wallets.”

Though that may be true, it is far more profitable for online companies to offer subscription services. Typically, an online store pays 65 or 70 cents to the record companies for each 99-cent track sold. But with subscription services, the online services split the fees 50-50 with the record labels after deducting certain expenses.

That fee-splitting cost structure is leading to what may turn into a price war among music subscription services, which generally cost just under $10 a month. AOL offers a subscription service to its members for $8.95 a month. Now Virgin is $1 cheaper than that.

[...] New technology from Microsoft, which is being adopted by most major electronics makers like Samsung, Rio and iRiver (though not by Apple) will allow devices to play songs downloaded in a special format from subscription services.

The songs will be programmed to expire on a set date, but that date is automatically extended when users connect their players back to the music software on their computers. If the user does not continue paying the monthly subscription bill, the songs will not play.

Plus, there’s these prognostications, and a bit of the music industry’s dream of endless format changes as revenue:

Others in the industry point out that surveys a decade ago said that cable subscribers preferred pay-per-view movies to subscription channels like HBO, but the channels turned out to be far more popular.

Moreover, Richard Wolpert, the chief strategy officer of RealNetworks, which offers the Rhapsody subscription service, says the idea that people buy music once and own it forever has not held true over the last few decades.

“I bought the Eagles ‘Hotel California’ on vinyl,” he said. “Then I bought it on 8-Track, really, then on a CD, and now I’ve bought it as a download.”

“What I really wanted,” Mr. Wolpert added, “was to be able to listen to the album wherever I wanted, whenever I wanted.”

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Author Artifacts and Publication Rights [8:01 am]

Hemingway Bullfight Tale From 1924 Turns Up

The documents fall into a quirk of copyright law. While the text may not be published without the permission of the Hemingway estate, the letter and typescript may be sold as artifacts, according to Patrick McGrath, a books and manuscripts specialist at Christie’s in New York.

Mr. McGrath said the auction house had authenticated the letter as written in Hemingway’s hand. The five-page carbon copy of the story has also been authenticated, he added, because of its provenance and because the words “The End” were in Hemingway’s handwriting.

It is not clear why permission to publish the documents was withheld. According to Mr. Stewart, the Ernest Hemingway Foundation granted him permission to publish the story and the letter in return for $500. The foundation, representing scholars and enthusiasts, is a legal entity endowed with some rights over unpublished Hemingway material, said Prof. Gerald Kennedy, its vice president and an English professor at Louisiana State University in Baton Rouge.

But under an agreement reached in 1983 after the death of the author’s widow, Mary Hemingway, joint permission from the foundation and the estate is required for the use of any previously unpublished material.

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September 26, 2004

Whose Fault? [12:33 pm]

While others are covering the media breakdown that this campaign seems to be engendering, I found these two articles to be worth reading, for background if nothing else. The perception that somehow the failure of “big media” is not their own fault is not surprising in this era of reduced responsibility everywhere, but it’s surprising to see self-flagellation in any form — and the implication that it’s all the Internet’s fault is just goofy:

  • Washington Post: The Media, Losing Their Way

    When the Internet opened the door to scores of “journalists” who had no allegiance at all to the skeptical and self-disciplined ethic of professional news gathering, the bars were already down in many old-line media organizations. That is how it happened that old pros such as Dan Rather and former New York Times editor Howell Raines got caught up in this fevered atmosphere and let their standards slip.

  • New York Times: Fear and Laptops on the Campaign Trail

    The news media helped create the modern campaign, and now they seem to be stuck in it. The bloggers, by contrast, adapted quickly. By the time the Republican convention rolled around in August, they had figured something out, staying far, far away from that zoo down at Madison Square Garden. They had begun to work the way news people do at manufactured news events, by sticking together, sharing information, repeating one another’s best lines. They were learning their limitations, and at the same time they were digging around and critiquing and fact-checking and raising money. They still liked posting dirty jokes and goofy Photoshopped pictures of politicians, but they had hope, and more than a few new ideas, and they were determined to make themselves heard.

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The Reach of Constitutional Law [12:25 pm]

Free to Clone

This election year, the debate over cloning technology has become a circus — and hardly anybody has noticed the gorilla hiding in the tent. Even while President Bush has endorsed throwing scientists in jail to stop ”reckless experiments” (and has tried to muscle the U.N. into adopting a ban on all forms of cloning, even for research), it’s just possible the First Amendment will protect researchers who want to perform cloning research.

Dr. Leon Kass, the chairman of the President’s Council on Bioethics and a cloning foe, would like to keep that a secret. ”I don’t want to encourage such thinking,” he said during the council’s July 24, 2003, session. But the notion that the First Amendment creates a ”right to research” has been around for a long time, and Kass knows it.

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Sticker Art [12:20 pm]

Download, Peel and Stick, and All the World’s a Gallery

Inspired by graffiti, posters and the communal culture of the Web, stickers are gaining wide attention as an artistic phenomenon, academics and practitioners say. Hand-drawn, stenciled or screen-printed, the images float on the Internet, available for downloading, printing and pasting in ways that the creators could only have imagined. And as they make their way around the globe, from one e-mail in-box to the next, one cultural context to another, their meaning tends to morph.

Now that broadband users can send large graphics files in an instant, stickers are a very fast-moving medium. A sticker can be created Monday morning in New York, e-mailed to a stranger in Paris and affixed to the back of a trash receptacle on the Champs-Élysées in the early afternoon.

My personal favorite: Obey Giant

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September 25, 2004

LA Weekly Takes On Big Music “Myths” [3:43 pm]

3 Myths About the Recording Industry Debunked [via p2pnet] — Notwithstanding the provocative title, a couple of interesting points. My favorite:

MYTH NO. 3: Musicians no longer need the record industry. The Internet and other new technologies make this a new era of “do it yourself.”

FACT: There are more opportunities than ever for musicians to find a niche in the industry, but “doing it yourself” — through the Internet or any other means — is harder than ever.

Technically, some things have gotten easier for artists over the past decade. Digital recording makes it more possible than ever to produce high-quality recordings on the cheap. The Internet makes it easier than ever to publicize music of any stripe. And judgment-blind yet heavily trafficked outlets like enable literally anyone to distribute their work.

Unfortunately, all this really means is that now there’s an infrastructure to support everyone’s delusions of stardom. [...]

[...] Community is important to cut through the noise, and like it or not, those communities are often organized around the industry trying to make money off music — record labels, clubs, promoters, magazines et al. While artists know best how to make art, businesspeople know best how to build relationships and gain leverage. So unless you’re an artist with an already robust career or an admiration for the marketing savvy of P. Diddy and Malcolm McLaren, it’s more important than ever to figure out how to interact with the music biz.

See also Orlowski’s surprisingly thoughtful (rather than rant-ful) piece at The Reg’s Orlowski On Online Music Business Models

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Interesting NY Southern District Court Ruling [3:13 pm]

US judge strikes down bootleg law [via Slashdot]

Judge Harold Baer Jr, sitting in New York, dismissed charges against a Manhattan-based record dealer which had been brought under the law.

He said the law could not stand because it placed no time limit on the ban - unlike the limits placed on books or recorded music releases.

[...] A federal grand jury indicted Jean Martignon in October 2003 for selling “unauthorised recordings of live performances by certain music artists through his business”.

But Judge Baer said US law unfairly granted “seemingly perpetual protection” to the original performances.

[...] The Recording Industry Association of America criticised the judge’s ruling.

“It stands in marked contrast to existing law and prior decisions that have determined that Congress was well within its constitutional authority to adopt legislation that prevented trafficking in copies of unauthorised performances of live music,” spokesman Jonathan Lamy said.

Later: Donna’s got a link to the opinion, as well as more comments: Copyright Terms Must Have Limits, and Part II

Later: Scrivener’s Error makes a few other points: Markup Problems

The real problem with bootleg recordings is now, and always has been, designation of origin and quality of goods—that is, trademark. One need not try to figure out whether bootleg recordings are “fixed” or not. One need only note that actual sale of the recordings inherently impinges on at least three types of marks: The performer’s identity; the venue’s identity; and any previously made authorized recording’s identity.

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September 24, 2004

Larry Takes Lehman To Task [5:10 pm]

As Larry asks in Lehman on Lehman, why exactly is Kerry putting this guy on his “technology committee?”

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The Reg’s Orlowski On Online Music Business Models [9:13 am]

How the music biz can live forever, get even richer, and be loved

In ten years’ time this will be moot. Digital distribution will make almost everyone in this room richer; publishers, songwriters, network providers. You’ll discover that technology is a tool that monetizes the consumption of music, rather than a tool for preventing people from listening to music. In ten years, you’ll have CDs that play themselves. The electronics will by then be so cheap that the thing you hold in your hand - a book, for example, or whatever package those songs are in - will be able to transmit its contents to the nearest speakers. If you’re around then, it will get very interesting - because the technology will do what all good technology does, and have made itself invisible. You won’t have Steve Jobs to complain about any more - or any other technologist. You should start thinking about that and maybe I’ll see you next year to talk about it. But that’s another reason to be optimistic. You have the recordings.

[...] You’re also underestimating China. If Nokia doesn’t make such a [wireless music sharing/broadcasting] device, then someone else will. Or they’ll make a dongle. Then you’re back to square one. Does China have the will to do this? Ask Qualcomm or Ericsson. Or Intel or Texas Instruments.

[...] So how are you going to monetize your rights, then? You need to be paid and you have shareholders to answer to. When file sharing becomes ubiquitous, and unstoppable, that’s the question they’ll be asking.

But this is an opportunity.

So here’s a modest proposal. Stop trying to prevent file sharing, and start counting it. Lobby to raise some money from somewhere. It could be a tax, it could be a fee on your phone bill, it could be a broadband tax, it could be an hifi or iPod tax. (Germany taxes CD burners) But the figures for these are very low. The United States alone could subsidize its movie and recording industries for two dollars a week per household out of general taxation. That’s everything. Permanent income for life - assuming people watch or listen to the stuff - for a rounding error.

If we compensate only a small part of what you say you’re losing - say twenty per cent of your revenues, then that’s $27 (£15.25) a year; 51 (28p) cents a week. For less than a bag of crisps per household per week, the record industry’s piracy problem will have disappeared.

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Wishful Thinking [9:03 am]

I find it hard to believe that Apple Corp. and Apple Computer will find such a win-win outcome — particularly in the face of the kind of numbers being discussed: Apple vs. Apple: Perfect harmony?

Music industry sources have said representatives of the surviving Beatles are at last discussing ideas for digital distribution with online companies but are asking for as much as $15 million for six months of exclusive rights to the music. That high price has some observers betting that Apple Computer might be the only company ready to pay, particularly if the payment comes attached to a legal settlement in which millions of dollars are already changing hands.

[...] Even a $15 million payment to Apple Corps would be difficult for a digital music company to recoup quickly. Songs that sell for 99 cents online typically require about 75 cents in payments to the associated music labels and music publishers. Nearly 15 cents typically goes for overhead, leaving online song stores with a margin of about 10 cents per song at best.

That would require a store to sell 150 million songs to break even on a $15 million payment to Apple Corps–a steep goal, even if the deal was ultimately responsible for a blitz of publicity.

But of course, it may all depend on how big a Beatles fan Jobs really is.

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The Governator Acts! [8:55 am]

Jail time for California file swappers?

California Gov. Arnold Schwarzenegger signed a law Tuesday establishing fines and potential jail time for anonymous file swappers. The new law says that any California resident who sends copyrighted works without permission to at least 10 other people must include his or her e-mail address and the title of the work. Swappers who do not include this information will face fines of up to $2,500 and up to one year in prison.

Minors can be fined up to $250 for their first two offenses, and a minor’s third offense can bring a $1,000 fine and a year in county jail. The law provides exemptions for people sending works to immediate family members and for the transmission of works inside a home network.

Text of SB 1506; Slashdot discussion: New California Law Bans Anonymous Media File Sharing; SFGate article: Governor signs Internet piracy bill [pdf]

Later: Wired News’ Law Sends Sharers to Slammer

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September 23, 2004

Donna on (c) and Education in Canada [6:09 pm]

Donna has lots to says about a Canadian news article that seems to show that educators, in their effort to carving out some fair use in the face of current copyright proposals in Canada, seem to give away the farm instead: Protect students’ free access to Web, groups say

Pitted against the publishing industry, six national education groups yesterday banded together to urge the federal government to reject any copyright law changes that would charge students and teachers a fee to use material on the Internet that is now free.

[...] Educators are not fighting the fact that some creators protect their work by passwords and allow only paying users to access their websites. The groups say they don’t agree with having to pay to use works that are publicly available on the Internet, as proposed in a draft document by the House of Commons standing committee on Canadian heritage. This will limit access to the Internet in schools, they say.

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The Terror War on the Internet: Online Speech Limits [1:50 pm]

Web War: Even Near Home, a New Front Is Opening in the Terror Battle

While Qaeda operatives have employed an arsenal of technical tools to communicate - from e-mail encryption and computer war games to grisly videotapes like the recent ones showing beheadings believed to have been carried out by Jordanian militant Abu Musab al-Zarqawi - investigators say they worry most about the Internet because extremists can reach a broad audience with relatively little chance of detection.

By examining sites like those stored inside the electronic walls of the Clifton business, investigators are hoping to identify who is behind them, what links they might have to terror groups, and what threat, if any, they might pose. And in a step that has raised alarms among civil libertarians and others and so far proven unpersuasive in the courtroom, prosecutors are charging that those administering these sites should be held criminally responsible for what is posted.

Attempting to apply broad new powers established by the Patriot Act, the federal government wants to punish those who it claims provide “expert advice or assistance” and therefore play an integral part of a global terror campaign that increasingly relies on the Internet. Deputy Defense Secretary Paul D. Wolfowitz, in testimony before the House Armed Services Committee recently, called such Web sites “cyber sanctuaries.”

“These networks are wonderful things that enable all kinds of good things in the world,” Mr. Wolfowitz said of the Internet. “But they’re also a tool that the terrorists use to conceal their identities, to move money, to encrypt messages, even to plan and conduct operations remotely.”

[...] Ms. Katz said she was not discouraged by the criticism of the prosecutions. “When you call for the death of people and then it results in actions - that is beyond the First Amendment,” she said. “You are organizing a crime.”

The Nuremberg Files, anyone?

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Sony Schizophrenia Continues [10:02 am]

Sony Considers MP3 Support to Silence iPod Fans

Consumer electronics giant Sony Corp. said on Thursday it is mulling a major strategic shift to make digital music devices that play MP3 song files.

The Walkman creator has long insisted its digital music players support only its proprietary ATRAC format, a move that has annoyed some Sony aficionados and allowed more accommodating music players like Apple Computer’s iPod to dent Sony’s long established dominance in the portable music business.

See also Derek’s Sony Marginally Less Stupid, Takes Nearly Meaningless Action

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Halloween Coming Early This Year [9:58 am]

In Strip This Bill, the Washington Post points out it’s going to be an interesting day in the House:

THE HOUSE is scheduled today to take up the Republican leadership’s latest attack on the federal courts. In July the House passed a bill to strip the courts of the power to hear challenges to the Defense of Marriage Act, a 1996 law that ensures that states do not have to recognize gay marriages performed in other states. (The Senate has yet to consider that power-stripping measure.) Today the House may vote on a bill to prevent the courts from ruling on challenges to the Pledge of Allegiance. Never mind that this year the Supreme Court overturned the one major lower-court opinion that had struck down the pledge and that there is no reason to think the court is having second thoughts. As far as House proponents are concerned, judges should never again even be able to consider whether the words “under God” are constitutional in the pledge.

Update: H.R.2028, the Pledge Protection Act, passed 247-173 — I look forward to the “π = 3 Act of 2004

Even later: the NYTimes’ take - Congress Slouches Toward Home; Marci Hamilton’s take: The Pledge Protection Act: The Lunacy of Letting Only State Courts Interpret the First Amendment

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Cultural Hegemony [8:42 am]

The US apparently exports yet another part of our culture — lawsuits over filesharing: Music boss can’t wait to sue British file sharers

The boss of Universal Music Group UK John Kennedy can’t wait to start suing British music sharers. John who? Although he’s well known in the British music business, Kennedy will have a bigger pulpit fairly soon. The combative former shipping lawyer will succeed Jay Berman as head of the lobby group the IPFI - the international version of the Recording Industry Ass. of America (RIAA) - and he defended both the the lawsuits and file poisoning at the In The City music conference in Manchester this week.

Greed, of course, is universal:

But he had even less sympathy for songwriters, who receive only a small fraction of royalties that recordings owners receive. that was fair, he insisted, as hits were down to investment in marketing, he said. At Polygram (which became Universal), Kennedy had stopped the practice of chart-fixing, he said, “because we were so bad at it. Songs that were supposed to chart at No.6 were coming in at No.34″.

He’d be more sympathetic to songwriters, he said, the day that record companies had “50 per cent margins”.

Slashdot: New IFPI Boss Vows to Extend Recording Copyrights

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