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Februrary 2004 News../ RIAA Demonstrates Its ResolveThe Recording Industry Association of America (RIAA) has demonstrated its resolve in the fight against online copyright infringement by filing an additional 531 lawsuits against unknown file traders.The most recent suits target subscribers of East coast based Internet Service Providers (ISPs) who the RIAA must first sue to determine the names of the infringers. A recent ruling dictated that the RIAA must go through the courts in order to identify file traders instead of just subpoenaing the ISPs directly. This round of suits make evident that the RIAA will not be dissuaded from their fight against online piracy no matter how many hoops of fire they have to jump through. The Future: The RIAA sends a strong statement to the marketplace by going on the offensive. They even got permission to include the FBI seal on new CD's to up the "fear factor." But the message is clear: We don't care how many 12 year old girls we have to sue, and we don't care how many obstacles we have to overcome to file those suits, we will not stop our war against online piracy.
All five suits, which may be consolidated, were filed in California and allege that Apple engaged in Unfair Competition and violated California's Consumer Legal Remedies Act. The Future: Apple's exaggerated claims of 8 hours of iPod battery life will finally be put to the test in court. Unless the plaintiff's lawyers really blow it, iPod owners can expect a rebate from Apple next year.
LA Reid will fill the void left by Lyor Cohen who was recently hired by Warner Music to run their North American operations. The move didn't surprise many. The word on the street was that Reid was being courted by both Island Def Jam and Edgar Bronfman Jr.'s Warner even before the dismissal. The Future: LA's reputation as a true "music man" with a substancial track record makes for a good fit with Island. His open wallent policy would have butted heads with Bronfman who intends to slash $225 million dollars in Warner expenses as soon as the ink is dry on his buyout.
From out of nowhere the Music Industry Piracy Investigations (MIPI), an Australian organization much like the U.S.'s Recording Industry Association of America (RIAA), has blind sided Sharman Networks, the owners of KaZaA, with this well coordinated attack. The MIPI utilized a statute of Australian law that allows organizations who believe others are violating their copyrights to conduct surprise searches. The RIAA and MIPI have been working closely together to combat global piracy, with the MIPI greatly benefiting from the RIAA's experience in past lawsuits. Part of MIPI's strategy was to provide the RIAA with more ammunition for its appeal against Morpheus and Grokster (see related story below). The MIPI then presented the accumulated evidence from the raids to a Federal Judge as a foundation for their lawsuit against Sharman Networks. The Future: This attack will be seen as "The Pearl Harbor" in the Australian copyright infringement wars. Expect a round of lawsuits against Australian "super sharers" to follow.
Going straight for one of the most popular and differentiating attributes of Digidesign's ProTools, Logic 7 will contain a brand
new groove template feature. This will be a rhythmic timing and dynamics tool that will do everything that Beat Detective can do
in ProTools with some additional beat templating features designed strictly for Logic. The Future: With the management of Steinberg in complete disarray, Apple is going for the jugular with this new version of Logic. Let's hope they also incorporate some of their renowned usability into the cryptic interface, so that migraters will have no problem ramping up to the new version.
What's fascinating is that both arguments hinge on the 20 year old Sony Betamax decision. That ruling stated that technology that could be used for piracy/bootlegging/copyright infringement were only legal if they demonstrated that they were capable of substantial non-infringing uses. "Substantial" clearly is the key word here and its certainly open to interpretation. Cary Sherman, President of the Recording Industry Association of America (RIAA) reiterates the point that he's been hammering since day one that both the Grokster and Morpheus services built infringement technology without providing mechanisms to prevent piracy. A decision by the panel could take months to be delivered. The RIAA was dealt an unsuspecting blow when Grokster was found not guilty in the original child and has been on the defensive ever since. What appeared to be a clear cut case of infringement by one Judge in the Napster ruling, was interpreted by another to be acceptable. These inconsistent rulings will continue to plague the RIAA's efforts in their campaign against illegal file trading. The Future: The best way to hurt the Peer-To-Peer services is to facilitate the poor user experience. Unlike Napster in its heyday, the current crop of P2P services provide the worst experiences to end users. Adware, Spyware, and other horrendous add on downloads, not to mention poor quality or mislabeled sound files, are severely hurting these services. A sustained, covert RIAA operation to make the user experience on these networks as bad as possible may go a longer way then their current crop of lawsuits.
The DualDisc system is currently being tested in the Boston and Seattle markets on 18 releases including Donald Fagen, Linkin Park, and R.E.M. Sony which developed and promotes its own high quality format called Super Audio CD (SACD) released DualDiscs by AudioSlave, AC/DC and David Bowie. The Future: The Majors are still in the slow lane in their deployment of a new format, but the DualDisc technology is a great migration solution.
This is a major coup for Davis who replaces his replacement, L.A. Reid. Reid was booted after years of losses, which are not entirely his fault as the industry has gone through major changes in the last few years with rampant downloading and widespread piracy. The consolidation is in tune with BMG's continuing effort to slim down its music division to its bare assets as it prepares to merge with Sony. However, the merger is under major scrutiny by European anti-trust authorities who are more sensitive to the Independent labels cries of despair then the US establishment. The Future: Both Sony and BMG are dealing with poorly performing entertainment divisions. Clive's may still have some of his old magic left for turning around the combined music division, but unless Sony Entertainment can hit some home runs next year their combined balance sheet won't impress Wall Street.
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