The Neilsen/Soundscan Numbers

That have been in the press so much these last two days: Nielsen Soundscan And Nielsen BDS 2003 Year End Music Industry Report

  • The overall music business is down 0.8% units sold as compared to 2002.

  • Overall Album sales are down 3.6% as compared to 2002.
  • CD album sales, which comprise 96% of all music sales, are down 2% as compared to 2002.
  • 19.2 million digital tracks have been sold since June 29th, 2003.
  • Overall Album sales were up 20% in the last reporting week of 2003 as compared to 2002.
  • In December 2003, Overall Album sales were up 5% as compared to December 2002.
  • In December 2003, CD album sales were up 6.1% as compared to December 2002.
  • Fourth quarter 2003 Overall music business is up 10.5% as compared to fourth quarter 2002.
  • Fourth quarter 2003 CD album sales were up 5.6% as compared to fourth quarter 2002.
  • Fourth quarter 2003 Overall Album sales were up 4.3% as compared to fourth quarter 2002.
  • Overall Music Video 2003 sales were up 78.5% as compared to 2002.
  • DVD Music Video 2003 sales were up 104.5% as compared to 2002.
  • Single 2003 sales were down 4% as compared to 2002.
  • Alternative, Jazz and Latin 2003 album sales were up over sales in 2002.
  • Cassette album 2003 sales were down 39.8% as compared to 2002.

Jon Johansen and iTunes

Just in time for MacWorld we get this from The Register: iTunes DRM cracked wide open for GNU/Linux. Seriously. (the code)

Norwegian programmer Jon Lech Johansen, who broke the DVD encryption scheme, has opened iTunes locked music a tad further, by allowing people to play songs they’ve purchased on iTunes Music Store on their GNU/Linux computers.

“We’re about to find out what Apple really thinks about Fair Use,” Johansen told The Register via email.

Johansen cracked iTunes DRM scheme in November by releasing code for a small Windows program that dumps the stream to disk in raw AAC format. This raw format required some trivial additions to convert it to an MP4 file that could be played on any capable computer.

But in the best Apple ease-of-use tradition, Johansen has now made this completely seamless, integrating it with the VideoLAN streaming free software project.

Update: Slashdot discussion: DVD-Jon Breaks iTunes Encryption For Linux Users

Spooky Argument

CNet News carries a lightyly-veiled neo-con call for the elimination of all regulation of telecommunications services under the guise of a discussion of VoIP: The metaphysics of VoIP. Sadly, he fails to discuss any number of key issues, assuming that "competition" is all that really matters — everything else will come out in the wash. Unless there’s some magic way to distinguish "economic" regulation from all the other ones that we might care about…..

What’s a regulator to do? I say: Just focus on the observable fact that to the VoIP customer, the service not only seems substitutable for POTS, but is, in fact, essentially substitutable in terms of the trade-offs involving price and service quality. And given the rapidly growing competitiveness of the telecom marketplace, there is no sound rationale for traditional economic regulation of VoIP.

What’s more, there is no longer a sound rational for economic regulation of the incumbent telecom companies’ services. As digital broadband increasingly displaces analog narrowband service–and as unregulated wireline, cable, wireless and Internet service providers compete for the consumer’s communications dollar, often with bundled service packages–the policymakers should use VoIP to seize the opportunity to move quickly to create a uniform deregulatory environment for all the players.

DRM To the Rescue — Of Whom?

Five Giants in Technology Unite to Deter File Sharing

A global consortium of technology companies is laying the groundwork for a campaign to convince Hollywood and the recording industry that it has finally found an acceptable way not just to limit the copying of music CD’s and movie DVD’s, but to protect digital content in the fast-growing market for hand-held devices capable of playing music, video clips and computer games while wirelessly connected to the Internet.

[…] The consortium – known as Project Hudson and made up of Intel, Nokia, Samsung, Toshiba and Matshushita – plans to announce its new approach in early February to precede the Grammy music awards and the movie industry’s Academy Awards ceremony, executives say. Unlike the system used to protect DVD content, an Internet-based wireless protection plan could permit users of hand-held devices to share movie or music files on a limited basis or permit files to be shared for promotional purposes. Users could also hear a song before deciding whether to buy it.

For the entertainment industry, the Internet has often been viewed primarily as a threat because it makes it possible to transmit copies of just about any original work that can be converted to digital code to just about anyone in the world. But it is increasingly being viewed more positively by some entertainment strategists, who recognize that the Internet’s nature as an “always on” medium makes it possible to refine new “digital leashes” to help ensure that copy protection plans are not subverted.

[…] Balancing the proliferation of competing digital information protection plans is a growing realization that the industry needs common standards.

That failure is hampering the growth of digital technologies, said Leonardo Chiariglione, an Italian electrical engineer who founded the group that developed the original MP3 digital audio compression standard widely used to play music on computers and share it across networks.

“Content should be as transparent as it is today with MP3,” Mr. Chiariglione said. “It should be movable anywhere and still be protected. If we stay with digital islands people have a legitimate excuse to piracy.”

The NYTimes on the Pew Study

In Survey, Fewer Are Sharing Files (or Admitting It)

“Clearly, the R.I.A.A. suits were a watershed moment for the downloading community,” the director of the Pew Internet project, Lee Rainie, said, referring to the lawsuits by the recording association.

[…] Mr. Rainie said that the steep drop represented a sharp turnaround among Internet users. “I’m trying to think of any significant Internet activity that was popular, and on an upswing, and saw a decline of this level,” he said.

A representative of the recording industry hailed the news from Pew. “This is another data point that tells us that the lawsuits have had an impact,” said Mitch Bainwol, the chairman and chief executive of the recording association. He called the new figures “encouraging” and said that, along with other measures that his group tracks internally, “it tells us that we’re on the right track, and ought to continue with the lawsuits.”

[…] To Ms. [Cindy] Cohn of the Electronic Frontier Foundation, the lawsuits may have helped the industry address the problem of downloading, but they cannot fix a broader issue: giving people the music that they actually want to buy. “Who will the labels blame next if file sharing actually has gone down,” she asked, “but they still haven’t seen a corresponding bump in their revenues?”

See also Pew Says the Lawsuits Are Working

Songwriters Heard From

Songwriters Say Piracy Eats Into Their Pay — a look at another constituency that’s working to get heard, and is positioning itself alongside the RIAA. Plus a call for compulsory licensing from the EFF’s Wendy Seltzer.

Writers can receive as much as 8.5 cents for each song that appears on an album, each time a copy of that album is sold.

In practice, however, many songwriters receive less, since royalties are typically split with their publishers, leaving them with 4 cents. If a song is co-written, that 4 cents is split again, so the total can amount to just 2 cents. Songwriters also receive royalties of varying amounts when a song is played on the radio, or is used in movies or television.

“Eight cents is nothing; it’s cheap,” said Carey Ramos, a lawyer for the National Music Publishers’ Association, which represents music publishers and their songwriters.

But “a penny here, a penny there – they add up,” he said. “In the aggregate, it’s a big difference in the paycheck of a songwriter.”

[…] [The EFF’s Wendy] Seltzer cited the sluggish economy and consolidation among record labels and radio companies as other reasons that record sales had fallen sharply over the last four years. She argued that, assuming the downloading is authorized, online music distribution actually lowered costs and increased exposure for songwriters and artists.

Songwriters “will have to learn how to adapt to the new technology,” Ms. Seltzer said. “The buggy manufacturer doesn’t have a place in the world of automobiles.”

She suggested that the music publishing industry adapt for the recording business a model similar to one used in radio, where broadcasters pay blanket fees for rights to play songs and the money is split among the songwriters.

Stallman on GNU’s 20th Anniversary

The Free Software Community After 20 Years: With great but incomplete success, what now?

Today we have a large community of users who run GNU, Linux and other free software. Thousands of people would like to extend this, and have adopted the goal of convincing more computer users to “use free software”. But what does it mean to “use free software”? Does that mean escaping from proprietary software, or merely installing free programs alongside it? Are we aiming to lead people to freedom, or just introduce them to our work? In other words, are we working for freedom, or have we replaced that goal with the shallow goal of popularity?

[…] If you take as your goal the increased popularity of certain free software, if you seek to convince more people to use some free programs some of the time, you might think those non-free program are helpful contributions to that goal. It is hard to dispute the claim that their availability helps make GNU/Linux more popular. If the widespread use of GNU or Linux is the ultimate goal of our community, we should logically applaud all applications that run on it, whether free or not.

But if our goal is freedom, that changes everything. Users cannot be free while using a non-free program. To free the citizens of cyberspace, we have to replace those non-free programs, not accept them. They are not contributions to our community, they are temptations to settle for continuing non-freedom.

[…] Those non-free programs are not trivial. Developing free replacements for them will be a big job; it may take years. The work may need the help of future hackers, young people today, people yet to be inspired to join the work on free software. What can we do today to help convince other people, in the future, to maintain the necessary determination and persistance to finish this work?

The most effective way to strengthen our community for the future is to spread understanding of the value of freedom–to teach more people to recognize the moral unacceptability of non-free software. People who value freedom are, in the long term, its best and essential defense.

Slashdot discussion: Stallman On Free Software and GNU’s 20th birthday

Don’t Cross ASCAP

A look at the mechanics of how ASCAP represents its members’ interests when a public performance of a copyrighted work is alleged: Skip’s Tavern has live music, again: S.F. bar owner pays royalties but still faces 2 suits alleging copyright infringement

If ASCAP didn’t seek such damages for prior infringements, “no one would ever get a license and we’d have to sue everybody,” [ASCAP’s Richard] Reimer said from his New York office.

Whether any musicians did in fact play copyrighted music at Skip’s is the crux of both lawsuits.

According to the first lawsuit, filed in October 2002, an investigator heard a band at Skip’s play three copyrighted songs in June 2002.

However, according to depositions given by Courtright and Regi Harvey, a musician who was on stage during the night in question, no such infringement took place.

In the second lawsuit, which Reimer said has been consolidated with the first, ASCAP said that musicians played copyrighted music at the bar illegally this past summer.

Pew Says the Lawsuits Are Working

Sharp decline in music file swapping: Data memo from PIP and comScore Media Metrix (see the charts on filesharing application usage and music downloading demographics) The Reuters wire article from Yahoo! and from CNet

Note that the graphs exhibit classic misleading errors — the KaZaA chart’s X-axis does not cross the Y-axis at zero, and the tables are all expressed in percentages of Internet users. Granted, earlier reports have suggested that the population of users is leveling off, but it’s difficult to tell what a table of percentages, particularly broken down by demographics, really indicates. Nevertheless, the data does seem to show that there has been an effect — its magnitude, however, is a little tricky to establish. And who knows what sort of substitution might be taking place.

The percentage of online Americans downloading music files on the Internet has dropped by half and the numbers who are downloading files on any given day have plunged since the Recording Industry Association of America (RIAA) began filing suits in September against those suspected of copyright infringement. Furthermore, a fifth of those who say they continue to download or share files online say they are doing so less often because of the suits.

[…] While multiple factors may have contributed to the decline, every nook of the music downloading world has been affected, including the parts of the population that were the most prolific users of online file-sharing networks. Steep drops in downloading were recorded among students, broadband users, young adults (those ages 18-29) and Internet veterans. The groups that recorded the steepest plunges in the percentage of downloaders were women (58% decrease in the size of the downloading population), those with some college education (61% decrease) and parents with children living at home (58% decrease). The survey was conducted among those 18 and older.

Update: Slashdot discussion — Pew Study Says RIAA Tactics Are Working