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January 2004 News../ NAMM Show Pre ReportThe 2004 NAMM show got underway with a keynote by Sir Ken Robinson on January 15 at the Anaheim Hilton. This was the first ever keynote address in NAMM's long history. Sir Ken Robinson is an internationally recognized expert in the development of creativity, innovation and human resources.Like the recent AES Show in New York City, the NAMM show didn't provide any of much needed innovations that the industry could really use right now. Apple, rumored to be debuting a hardware controller for Logic, instead announced a consolidation of the product line by separating the sequencer/hard disk recorder into two separate entities, Logic Pro and Logic Express. The good news is that every single Logic attribute that was sold separately, such as the impressive Space Designer and EXSP24 Sample Player, has been rolled up into the Pro offering for only $999. The bad news is that if you recently purchased Space Designer for $399, you're not a happy camper. Upgrades from Logic 6 Platinum to Logic Pro will be available for $199. Alesis announced the Micron, a sexy 37 key version of their Ion virtual analog synthsizer. Korg showed off the repackaged Triton Extreme and tube versions of their Electribe series. Elektron went into stealth mode by showcasing the Machine Drum and MonoMachine in a hotel room across the street. Futuremusic's staffers have been admirers of the MachineDrum, and the MonoMachine was quite inspiring as well. Bias announced more details on their new SoundSoap Pro audio restoration program, available for both Mac OS X and Windows XP, including a retail price of $599. Our full report will be online in the near future.
Based on the effectiveness of the crackdown in the United States by the Recording Association Of America (RIAA), the IFPI has decided that suing individuals is the only way to thwart piracy. Many feel that the lawsuits are long overdue because file trading has remained unchecked in Europe. In Germany, according to the most recent IFPI data, the combined amount of CDs bootlegged and illegal music downloads has surpassed the number of those bought in the first half of 2003. The German market has had over an 18% decline in legal music sales during the same period. One of the biggest problems that the Europeans don't seem to want to discuss is the simple fact that, due to legal and bureaucratic obstacles, the development of commercial music services has been systematically foiled. To make matters worse, the European courts have often sided with the file trading services instead of the music labels when it comes to trading copyrighted music. The Dutch Supreme Court recently ruled that KaZaA couldn't be held responsible for piracy on their network. On Demand Distribution PLC, an online distribution service co-founded by musician Peter Gabriel, is the only commercial entity that has negotiated to commercially sell a sizeable quantity of European music online. Why only one? The main reason is that it battled for over four years to secure the music licenses. Even with all the negotiating, the European licensing fees are almost three times as much as the U.S. fees - 23.6 cents as opposed to 8 cents. Europe's largest collection agency, German based GEMA who represents 60,000 composers and songwriters, has been playing hardball with concerns who wish to enter the legal download market, and won't budge on their steep, and unrealistic, licensing fees. iTunes, the premier online service in the U.S., has side stepped the whole mess by only selling to consumers in Europe who have credit cards with U.S. billing addresses. When there are no legal options, the European community has no choice but to flock to the illegal services. The Future: The European market forces music consumers to illegally trade files via P2P services and refused to pave the way for legal commercial enterprises to flower online. Now with several courts supporting the notion that KaZaA and the like are not responsible for the illegal activity that occurs on their networks, many Europeans don't fear the legal actions of the IFPI. However, the IFPI has learned from the public relations blunders that the RIAA made, and will certainly target the super users (and not minors living in Government sponsored housing). Unfortunately, this will not be enough to stymie illegal music downloading in Europe.
The Future: A smart move for Apple to expand its iPod line, which has been a tremendous success with over 2 million units sold, but the $249 cost for the iPod Mini misses the magic price point of "under $200." Apple should have gone for the jugular against Samsung, Dell and the like, by selling it for $199.
The Future: Yawn. Clearly the store is a funnel to get customers to sign up for the much more profitable subscription service.
Now the Recording Industry Association of America (RIAA) will have to make their case before a judge to obtain a subpoena, instead of just filling out a brief form. This will certainly inhibit the RIAA's ability to obtain the identities of alleged file traders quickly and easily, but will by no means stop the suits. Cary Sherman, President of the RIAA, has pledged to keep on filing suits no matter how many hoops of fire the RIAA has to jump through. The reason is that the suits are working. According to the most recent numbers from SoundScan, the steep decline in CD sales reversed itself on practically the same day the suits were filed. Music sales have increased 12 out of the 16 weeks since the suits were filed and it appears that overall sales are only going to be down 0.8% for the year way up from the earlier predictions of a 8.4% yearly slide. The Future: Despite the public relations nightmare, the suits were, and will continue to be, a serious deterrent to illegal file trading. If the RIAA did not have the SoundScan numbers to back up the effectiveness of the suits, the organization would have definitely re-evaluated their litigious stance. However, with the numbers in their favor, look for the RIAA to continue their legal campaign against file trades, no matter how cumbersome the process becomes. The real decision for the RIAA is whether to appeal this decision by taking the case to the supreme court or to wage a serious lobby attempt at congress to amend the current digital copyright laws to include P2P services.
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