RIAA: all of everything are belong to us

Correction:  Techdirt is now reporting that this story is bogus and that the RIAA never threw out a number in the trillions.

The Recording Industry Association of America sued peer-to-peer filesharing service Limewire for copyright infringement years ago, and it successfully shut down that service back in 2010.  Now, the RIAA says it’s owed a few dollars in damages for those years of Limewire’s infringement.  $72 trillion, to be exact:

According to documents recently filed in the U.S. District Court for the Southern District of New York, the RIAA was asking for damages of about $72 trillion dollars, a figure that the judge in the case said is “absurd.” Judge Kimba Wood wrote in a recent decision that, “An award based on the RIAA calculations would amount to ‘more money than the entire music industry has made since Edison’s invention of the phonograph in 1877.'”

The estimated wealth of the entire world is about $60 trillion, meaning that the RIAA should have known how outlandish its claims were to begin with.

A modest quibble with the AV Club’s figures:  the CIA puts Gross World Product (the combined GDP for all countries on Earth) a bit higher, at $70.16 trillion for 2011.  But any way you slice it, the RIAA thinks that copyright infringement due to one (now defunct) company entitles it to the value of everything in the world.


Tenenbaum oral arguments on YouTube

Having attended the oral arguments before the 1st Circuit Court of Appeals in Sony BMG Music Entertainment et al v. Tenenbaum yesterday and analyzed my initial impression here, I was pleased to see that the court posted (MP3) the audio of the oral arguments on its website.

Unfortunately, it is often difficult to tell who is speaking given the bare audio.  Therefore, I have decided to post the audio on YouTube and annotate it so that listeners can know who is speaking when.  I hope many find this helpful.

Here are the links, in 5 parts:

The argument was before a panel of three First Circuit judges:

  • Sandra L. Lynch, Chief Appellate Judge
  • Juan R. Torruella, Appellate Judge
  • Rogeriee Thompson, Appellate Judge

For even more fun, you can download the briefs here to follow along with the audio.  Happy analysis!

Covering file-sharing appeal

I’m going to be attending oral arguments here in Boston before the First Circuit Court of Appeals in the Sony BMG Music Entertainment v. Tenenbaum case (Wikipedia backgrounder) later this morning.  Appellate briefs are available here, summary from the defendant’s perspective here.

Check back later today for more commentary and analysis.

Status update: P2P still in litigation

Nate Anderson at Wired reminds us that “the first file-sharing case in the US to go all the way to trial is still going”:

Filed on April 19, 2006 and progressing through a remarkable three trials, the recording industry case against Minnesota resident Jammie Thomas-Rasset continues to burn through cash and judicial attention.

Thomas-Rasset was at first hit with a $222,000 fine in 2007, which was set aside in 2008. Another jury trial in 2009 ended with a $1.92 million judgment, which was set aside in 2010. In November 2010, a third trial ended with a $1.5 million verdict, which the judge is unlikely to allow (his previous orders suggested that a few thousand dollars per song would be the maximum permissible damages). At the moment, both sides are still arguing over the appropriateness of that $1.5 million damages award.

Almost five years.  Three trials (so far).  What a colossal waste of economic, judicial, and personal resources.

Nobody’s a hero here

The thrill is gone:  today we find out that there will not be another Guitar Hero release anytime in the foreseeable future:

Activision Blizzard will close its music-game business division, laying off hundreds of employees, and cancel the Guitar Hero game that was in development for 2011, the publisher said in a conference call Wednesday.

The drastic move comes after significant industrywide declines in the music game business. In 2007, Activision sold 1.5 million copies of Guitar Hero III in its first month of sales. Last year, Activision only sold 86,000 copies of the latest game in the series, Guitar Hero: Warriors of Rock. Slowing sales of chief competitor Rock Band led Viacom to sell maker Harmonix and close the MTV Games publishing division.

Activision said that the decline of the genre, plus the high cost of licensing music and producing the games, led it to close the business. [emphasis added]

Arguably, Guitar Hero and Rock Band were fads (at least, at their white-hot sales peaks) whose time had passed.  Nevertheless, these games were probably some of the cheapest console games (from a technical/development standpoint) made in the last few years.  The real cost driver here had to be the music licensing fees.  At the right (i.e., low enough) price, these games probably could have been made indefinitely, but it appears that monopoly-imposed costs have outstripped demand and the dreaded deadweight loss triangle has destroyed the market.

Which begs the question:  why does the music industry continually insist on killing geese that lay it golden eggs? In my view, there’s a difference between profiting from risk taking (i.e., capitalism generally) and expecting other people to pay you an ever-increasing cut of the revenue stream based on the risks they took in finding and exploiting a new market which literally did not exist before.  As for the music industry’s attempt to parlay other people’s risk taking into ever bigger royalty streams for themselves, they can’t really complain when the market softens and no one can afford to pay their exorbitant fees.

(On a final, parenthetical note:  no-doubt-soon-to-be-former music industry execs should perhaps consider a career move into lottery management.  In addition to being the ultimate something-for-nothing industry, the lottery is bigger than porn, movies, and music combined. It’s also a regressive tax on the poor, a perfect money-laundering machine for organized crime, and easily rigged.)

Seizing the spotlight

One of the items highlighted in Monday’s Intellectual Property Enforcement Coordinator (IPEC) report (92 page PDF–see here for my previous post) was government seizures of various domain names allegedly associated with infringing comment.  Bruce Lidi over at ZeroPaid makes a compelling argument that the publicity associated with such tactics is counter-productive at best:

As nearly every analysis of the recent ICE action has noted, by seizing the US registered domain names of foreign-owned and operated sites, the authorities have propelled the sites to set up on domains not under US control, and to do so within days, if not hours, of the seizures….It would appear that aside from a very momentary interruption, the practical effect of the seizures will be negligible, except to make any future actions by rights holders that much more difficult, since the targeted sites will be farther from US jurisdiction.

Additionally, and even more importantly, the recent ICE domain seizures that focused on sports streaming sites has had, and will continue to have, the effect of generating more publicity for this kind of infringing.  Consistent with the concept of the “Streisand Effect,” attempts to suppress troublesome information online result invariably in that information becoming even more widely distributed.  While impossible to quantify with any certainty, the seizures by ICE surely increased awareness of the existence of rojadirecta and atdhe, and even more, of the ease in which viewers can access live streaming of sporting events online.  As we so often see in articles about “cord-cutting,” or dropping cable in favor of purely internet video delivery, many people are stymied by the lack of live sports online, yet now, because of the actions of ICE, millions more viewers have just been instructed that it is actually quite simple to get live footage of every soccer match or football game.

Lidi’s analysis reminded me of countless debates I’ve read about U.S. military policy.  Some people favor a “shock and awe” approach while others think that “winning over hearts and minds” is the way to go.  Unfortunately for the content industry, I’m not sure that they’re ever going to win people over completely to their way of thinking.  Anyone who claims that, as a practical matter, people don’t have the right to rip their owned CD into Mp3’s (article from 2008 but still true–see the RIAA’s current website) has completely lost touch with reality.