posted
I just caught this over at Ars Technica, a geek news site I keep tabs on. They link to this paper, which is a rebuttal of the CRIA's (our RIAA equivalent body) claims that piracy has cost them two billion dollars since 1999.
I'm just starting to read the paper now, and I have a bus to catch in about 15 minutes, so I probably won't get through it until after dinner, but I thought I'd toss this out before heading on my merry way.
It at least opens with a good paragraph: [Edit: Er, three paragraphs.]
quote:The Canadian government has been the target of intense lobbying for stronger copyright legislation in recent months. Led by the music industry, which claims that it has experienced significant financial losses due to music downloading, the campaign culminated in November 2004 with a lobby day on Parliament Hill [1].
The campaign is premised on three key pillars. First, that the Canadian recording industry has sustained significant financial losses in recent years due to decreased music sales. Second, that those losses can be attributed to peer–to–peer file sharing. Third, that the losses have materially harmed Canadian artists.
The time has come to acknowledge that each of these pillars is a myth.
Hopefully, he has the data to back it up. The Ars blurb on the paper implies that he does.
posted
Good. I favor copyright protection, but the RIAA has been blatantly lying to gain protection far in excess of the economic justification. It's designed to promote the spread of knowledge. Holding up what promises to be one of the most effective means of information is not promoting that spread.
posted
For those inclined to view the RIAA as nothing more than modern day robber barons (as I do) here is an excellent article penned by Janis Ian. This should be required reading for any holier-than-thou apologist for the RIAA. I'm not opposed to copyright legislation persee but its present manifestation is a perversion. Recording labels are enabled to make artists their employees and as such the copyright belongs to the labels and they can hold that copyright virtually in perpetuity. Their claim that they are fighting for the artists is an irony that defies belief.
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posted
While I agree that people should pay for their music and not think it is simply theirs to download (it isn't), I also think the record industry has built its fortune on ripping off both artists and consumers. It needs major reforms. But I'm still uneasy with the argument that this justifies taking it for free.
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posted
I'm not in favor of those arguments either. And if the RIAA was just going after people who downloaded illegally or provided illegal downloads, I'd have much less of a problem with them.
However:
1.) they are trying to ban incredibly useful technology, namely P2P file sharing, because it can also be used to copy music.
2.) they are allowed to gain personal information about ISP customers without adequate due process.
3.) they get an unjustified cut of audio CDs, and enforce protection schemes on us that raise our costs and limit our technology.
4.) they are lying about the economics of the industry to justify these policies and to push for even more restrictive policies. It is in this context that exposing how they rip people off is relevant, not to justify violations of the law.
posted
My problem with the R/CRIA is that their handling of this issue shows, very clearly, that they do not understand technology.
I'm enjoying the paper, too. He does have the numbers, all referenced. Refreshing. And that Janis Ian article isn't bad either, though it's more anecdotal in style than this one.
I keep seeing snippets I want to quote. Like this one:
quote:To understand the impact of declining sales on Canadian recording artists, three pieces of information are needed. First, the percentage of the Canadian retail music market commanded by Canadian artists must be identified in order to determine lost Canadian artist sales. Let us assume that the percentage in music download practices mirror retail purchasing habits.
Statistics Canada, the government’s statistical agency, has estimated that Canadian artists account for roughly 16 percent of the Canadian market [19], while the Canadian music industry claims that the number is actually 23 percent [20]. Using the higher 23 percent figure, this suggests that the total six year sales loss for Canadian artists is C$99.3 million or C$16.5 million per year.
Note, however, that the C$16.5 million annual figure reflects the total lost Canadian artist sales, not the lost Canadian artist sales attributable to music downloading. If the various other factors contributing to the loss discussed earlier are included and the Economist’s estimate 66 percent of recent sales declines had nothing to do with Internet music downloads (the high end of the estimate), then the loss in Canadian artist sales that could be due to music downloading would stand at C$5.5 million per year.
The second key piece of information is the royalty rate earned by Canadian artists for their music sales. Even if Canadian artist sales are down by C$5.5 million per year due to music downloading, the actual loss sustained by the artists is limited to the lost royalties attached to those sales.
Although royalty rates vary between artists, the consensus estimate is that the combined royalties earned by both the performer and the songwriter stand at approximately 12 percent. In fact, Sanderson Taylor, a leading Canadian music law firm, maintains that the actual royalty earned by the artists is typically even lower, since the producer’s royalty is taken from the artists’ compensation and many contracts do not provide for a full royalty for CD sales [21].
Assuming artists receive the full 12 percent royalty, the annual royalty loss attributable to music downloading in Canada is about C$655,000 (12 percent of C$5.5 million). For those that claim that the full industry loss should be counted, the annual lost royalty for Canadian artists stands at C$2 million.
Some in the industry argue that this understates the impact since CRIA’s financial data reflects wholesale shipments and revenues, rather than the somewhat higher revenues generated at the retail level. According to CRIA’s president Graham Henderson, the artists’ royalty may be as high as twenty percent of the wholesale CD pricing [22]. Even with the higher royalty figure, the annual lost royalty for Canadian artists could only increase to C$1.1 million for lost sales due to file–sharing or C$3.3 million for all decreased sales.
That's a far cry from the CRIA's claim of $450 million in annual lost sales (which is absurd anyway, given that their revenues are in the $500-600 million range).
Also, in Canada we have a levy on media that can be used in piracy (CD-R/RW, MP3 players, et cetera), that goes straight into the CRIA's pocket:
quote:Moreover, lost royalties must be offset by the third key factor used to calculate the impact of music downloading on Canadian artists — the private copying levy.
The levy represents an effective, if controversial, means to compensate artists. The Copyright Act includes a private copying exception that grants Canadians the right to make personal, non–commercial copies of music without requiring permission from the copyright holder. Both the Copyright Board of Canada and the Federal Court of Canada have ruled that private copying may include peer–to–peer music downloads [24]. This interpretation is consistent with both the technologically neutral language found in the legislation as well as with many similar private copying systems in Europe.
In return for that right, the Copyright Board of Canada establishes a levy on blank media such as recordable CDs and on equipment such as MP3 players. The Canadian Private Copying Collective (CPCC) collects the levy and is responsible for distributing the proceeds to songwriters, performers, and the music labels.
While artists may only receive a few pennies per blank CD, those pennies add up to millions of dollars. As of the end of 2004, the CPCC has collected just over C$120 million since 1999 (the levy generated C$33.2 million in 2004) [25], though the collective has been agonizingly slow in distributing the proceeds [26].
I particularly like that last line.
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