Issues, Piracy, Copyright, Music Licensing, Further Resources
Issues Facing the Music Industry

Performing Rights & Licensing

Holland, Bill. (2002, March 2). CARP takes middle ground on digital licensing rates. Billboard 114, p. 9, 12.

On 2/20/02 the Copyright Arbitration Royalty Panel (CARP) set the rates for digital material license fees at a rate of 10 times that proposed by Webcasters, yet only 35% of that desired by the RIAA. The rate set was .14 cents per performance for standalone streaming digital webcasts and .07 cents per song for "simultaneous Internet retransmissions of on-the-air AM or FM broadcasts."
Follow-up on Digital Audio/Webcasting/Streaming Issues may be found at the following sites:
AFM memo urging union members to contact legislators regarding the Webcaster's dispute of the decision.
Article indicating that despite the increase in costs to Webcasters streaming media viewers and hours are on the rise.
Music Industry News Network (mi2n) article indicating the importance of this issue.

Taylor, Millie and Ruth Towse. (1998, October). "The value of performers' rights: an economic approach. Media, Culture and Society. V. 20:4, 631-652.

While focusing mainly on organizations and royalty structures of the UK's recording industry this article clearly explains the oftentimes-mystifying structure of the "pay-for-use" principle in music. Various changes to copyright law that were precipitated by new media capabilities and implemented by the European Union and UK are also discussed. How these changes will financially affect performers and recording companies/publishers is also covered.

MacQueen, Hector L. and Alan Peacock. (1995). "Implementing performing rights." Journal of Cultural Economics, 19:2, 157-175.

This article was part of an issue devoted exclusively to copyright issues. Using the UK Recording Industry is its backdrop, the article expounds upon relationships between members, users, and organizations by looking for one at the history of the British Performing Rights Society. Another question addressed is where does copyright protection end and performers' rights begin. The stages of exploitation of copyright are: creation a work in a discernible form (score or tape), and 2) publication, promotion and performance of the work.

Peer to Peer Music Distribution Models (Napster, MP3.com, etc.)

Holand, Bill. (2002, March 9). "Congress sees Napster case in antitrust light." Billboard, 114:9, 1, 68.

When the RIAA and music publishers asked for a summary judgment in the Napster copyright infringement case the judge instead ruled for a continuance of the case in order to verify the recording companies' ownership of the allegedly infringed songs and to determine whether the labels themselves are employing discriminatory and anti-competitive licensing practices. Pressplay and MusicNet, two online music services formed by labels collaboratively, are a concern and may mean antitrust violations.

Cartwright, Shawn D. (Sep/Oct 2000). Napster: A business in search of a viable model Journal of Business Strategy 28-32 21, no. 5, 28-32.

This article explains the threat Napster and Napster-like websites have to the music industry oligarchy. In the past the industry controlled creation and distribution, or as the article says "most of the music supply chain." However, with Napster's help more people have been introduced to the possibilities of digital transmission and sharing of songs online. Napster is essentially an index of what its various users own and those who install the software can find who has what they want and download it directly from the computer on which it is located. The article also suggests the business strategy Napster should take in order to survive.

Kover, Amy. (2000, March 20). Who's afraid of this kid? Fortune v. 141:6, p. 129-30.

After mentioning of the spread of the Napster phenomena across college campuses, the article talks of Napster's chances in the copyright lawsuit they were up against six months after opening up shop. Interestingly this article (pre-decision) argues that Napster has an edge because they just offer the software to exchange the content not the content themselves. The article comes down hard on the Recording Industry's, yet also contends there is hypocrisy on both sides.

Alexander, Peter J. (2002). "Peer-to-Peer File Sharing: The Case of the Music Recording Industry." Review of Industrial Organization, 20: 2, p. 151-161.

This recent article clearly explains the MP3 file format and related digital distribution systems in terms of their revolutionary effect on both music reproduction and distribution costs. It not only gives a summary of the RIAA suits against MP3.com and Napster, but it explains the challenges ahead with the introduction of further technological advances. Technologies such as decentralized systems, Gnutella and Freenet, which allow less detectable file sharing bypassing central servers, and encryption advances through SDMI are also discussed. The conclusion reached is that "significant structural change in the industry" is likely around the corner.

Piracy on the Internet

Secure Digital Music Initiative

This agency is attempting to defeat the illegal distribution of sound files, especially MP3 files over the Internet. However when the SDMI issued a challenge to break through their supposedly secure encoding techniques, they were not ready for Princeton University's computer science faculty. They easily defeated the system and their result's can be seen at Princeton's website.

International Recording Media Association (IRMA)

This is another agency active in the fight against piracy, advocating for better technology as well as finding international partners to agree to their Anti-Piracy Compliance Program. They have established the first of such programs aimed at setting regulations for the manufacture of CDs, DVDs and CD-ROMs. "This inititiative is designed to help manufacturing plants establish procedures to reduce the risk of publishing pirated material. IRMA's Anti-Piracy Compliance Program is modeled after the ISO 9000 Program."

Cooper, Jon and Harrison, Daniel M. (2001). "The social organization of audio piracy on the Internet." Media, Culture & Society, 23:1, 71-89.

This article gives one an inside look into the technology and social structure of the audio piracy culture. Using an ethnographical research method the writers joined the life of this virtual community for a period of months in order to understand the lingo and roles that various participants play. Definitely read this article if you are interested in the reason Recording companies are investing so much in the SDMI intitiave and thus reexamining their own strategies for production and dissemination of music.

Technology

Lardner, James. (Sep 20, 1999). "The record industry gives peace a chance." US News & WorldReport, 127:11, p. 48.

With a focus on the implementation and development of the SDMI technology, this article insists that the big six music companies aren't so concerned with Napster and other sites making money as much as they are with artists themselves going solo and leaving them out of the profits. Some artists, Prince, David Bowie, and Tom Petty, among others are offering music on their websites, though the later was persuaded by Warner Brothers to withdraw a promotional track of which he had supposedly given out 150,000 copies.

Alexander, Peter J. (1994). "New technology and market structure: evidence from the music recording industry," Journal of Cultural Economics, 18:2, 113-123.

Key words used are "scale-reducing technology" and "market structure." The article takes a historical look at technology's effect on the concentration of players entering the industry with the late 1910s and 1950s being "significant waves of entry." Then the article considers the acquisition of smaller independent distributors and the horizontal mergers of the 1960s and 1970s, stating that the high cost of distribution was a barrier in entering the industry. Now however digital delivery capabilities have brought in more players to the field and thus encouraged competition and fostered more diversity in product offerings.

Heid, Jim. (May 2000). MP3 Fans get new players, service--will squabbles stop the music? PC World 60-64, 18:5, 60-64.

After a review of different MP3 walkmans currently on the market this articles breezes through the workings of the two companies recently sued by the Recording Industry: MP3.com and napster.com. For an article from a technical journal, the style is very readable and a good introduction to some of the cutting edge companies and equipment. To download MP3 players and files click to the author's site.

Black, David A. (2001). "Internet radio: a case study in medium specificty." Media, Culture & Society, 23:3, p. 397-408.

After starting with an amusing debate about the use of the word "eradio" to define the use of streaming audio technology of the Internet, the article looks at the medium in terms of its place in Internet history and as a possible alternative to ratings driven regular radio. "Eradio" was a trade magazine the author ran across at the National Association of Broadcasters convention in 2000. The subtitle was 'the business of audio on the Internet.'

Banks, Jack. (1998). Video in the machine: the incorporation of music video into the recording industry. Popular Music. 16:3, p. 293-309.
Companies must integrate veritically if they are to be active in the music video scene, because then they have greater control over the promotion of their products. In addition an artist should now expect to have a written contract that includes a video component. This article offers a good overview of the role MTV and video has had on the recording industry.

Schoenherr, Steve. (2002). Recording Technology History. Retrieved from the www on May 13, 2002.
This listing of twenty links, includes a fourteen category timeline of events from Edison's first tinfoil cylinder recording in 1877 to Disney's release in 2000 of Fantasia in the IMAX format. It is a true web resource with links to other websites and sources throughout the timeline. As stated at the top of the site the author just revised his notes on March 23, 2002. Hopefully the site will be maintained for years to come.

ZDNET
A technology site for finding out what is the hottest gear on the market. For instance, if one searches the site for MP3 one will find a list of products as well as a newsgroup where you can exchange information. Whether or not recording companies check the newsgroups for illegal activities is up for debate.

Cultural Imperialism

International Association for the Study of Popular Music

This organization is a scholarly organization with online articles on a variety of topics, links to further resources, and news about their conferences. For those researching the field of popular music, both its history and how cultures can colide and be lost to another in the process, then this is the place to start. See for example the article on the history of the phonograph.

Soundscapes - Online Journal on Media Culture

This site has various articles, and while many are in English, some are in Dutch and German. A 1999 article by Peter Wicke discusses the part rock music played in the destruction of the Berlin Wall.

Burke, Andrew E. (1997). "Small firm start-up by composers in the recording industry," Small Business Economics, 9:6, p. 463-471.

Written from an economic perspective, the article uses what he claims to be a simple model to analyze supply and demand for a musician's creative goods. He then argues that "start-up ventures, while having restricted market power, may still desire to break free of contractual agreements given that the research tends to show the economic justification in so doing.

Seago, Alex. (2000, Summer/Fall). "Where hamburgers sizzle on an open grill night and day"(?): global pop music and Americanization in the year 2000." American Studies, 41:2/3, p. 119-136.

This article convincingly argues that "McDonalization" is less a factor in pop music creation and consumption than in other cultural industries like television and film, which require a greater investment of capital. The idea of "Cultural Imperialism" in the music industry is also critiqued, in that the reality is a trend toward creolization, indigenization and hybridization. World artists respond to their local culture while experimenting in a larger range of musical possibilities. Perhaps more niche markets and direct communication between artists and listeners will increasingly challenge the multinational corporations who are already trying to cut off Internet-based MP3 service providers.

Colista, Celia and Leshner, Glenn. (June 1998). "Traveling music: following the path of music through the global market." Critical Studies in Mass Communication, 15:2, p. 181-194.

This is an important article that addresses research into whether the pervasiveness of "Angl-American" pop music threatens local cultures and their music. From the Cultural Imperialist (CI) perspective, a group coming to the forefront around 1970, the anwer has been yes. However, this article reviews newer theories that criticize CI's lack of empirical research and simplistics conclusions. By comparing the various theories a model emerges to explain the continuum of musical flow from cultures. The model incorporates Cultural Imperialist, Asymmetrical Interdependence, Transculturation, and Cultural Exchange theories.

Scannell, Paddy. (2001). Music, radio and the record business in Zimbabwe today. Popular Music. 20:1, p. 13-27.
The topic of this article is rare indeed and offers a unique perspective of industry dynamics in a developing region. While the BBC and British influence is seen in South Africa, there is really no music industry in Zimbabwe, which means local artists produce tapes that are of poor quality. In addition the country has a huge piracy problem with these tapes, which means that the musicians don't even reap any economic rewards nor have a chance at becoming career musicians.

Lilienkamp, Marc. (2000). Das Internetprojekt voxpop/popspeak

This website is a project in conjunction with a dissertation by Marc Lilienkamp on the topic of Anglo-American and Popular Culture as an influence on French, German, and Spanish music. German title: "Angloamerikanismus und Popkultur. Untersuchungen zur Sprache in französischen, deutschen und spanischen Musikmagazinen." Although this site is difficult for the non-German speaker, it offers a hint at the global purpose of this website.

Rutten, Paul. (May 1991). "Local Music and the International Marketplace." Theoretischen Seminar des Forschungszentrums.

This article though a bit dated has some neat charts showing the trends in music sales by year and comparing US sales with local sales in various markets. There is a focus at one point on the Netherlands. We must look at each individual country as a different market entity in its own historical context in order understand the local music industry in the global marketplace.

Copyright

Holland, Bill. (2002, March 2). "High Court to hear copyright case." Billboard 114, p. 9.

The Supreme court will hear a case this session that challenges the 1998 Sonny Bono Copyright Extension Act, which increased coverage of works to the life of the author puls seventy years. The litigator, a book publisher of works in the public domain, argues the law hurts the public and limits the usefulness of out-of-print works. Those opposed to the challenge include the recording industry, performance rights societies and major publishers. ASACP, BMI, NMPA, RIAA have states opinions in past appeals attempts.

Moore, W John. (May 6, 2000). Bye-bye, American pie. National Journal, 32:19, p. 1464.

In 1999 the RIAA inserted four lines into a satellite telecommunication bill, which Clinton later signed which defines sound recordings as "works for hire." After the bill was signed, many artists voiced their opposition, saying that previously they could get the rights to their recordings back after a given number of years and now this possibility was eliminated. The article's closing thought rings true - though many lawmakers think trade associations like the RIAA represent the artists, they actually "often turn around and play hardball with artist and writers on issues such as electronic rights and royalties." (The hearing scheduled for May 25th, 2000 was well attended by angry rock artists, including instigator Don Henley, and this did in fact get taken out of the bill.)

Holland, Bill. (2002, March 2). "Sound recordings and Copyright Act's termination right. Billboard 114, p. 90.

Artists are challenging the interpretation of the Copyright Act's termination right in order to regain their ownership of sound recordings. After the sponsoring recording company has exploited a recording for a given number of years the writer may then give notice to the company ten years before the end of the period set by the Copyright law. For works recorded after 1/1/78 the period is 35 years, and for works recorded between 2/15/72-1/1/78 the term is 56 years. Under current law works before 1972 have no such provisions, although state laws may apply as in suing for "failure to compensate royalties in contract law."

Copyright Website

Covering digital, visual, and audio formats, this award-winning site is easy to navigate and has various famous cases to consider as food for thought. Especially fun are the sound files of various infringement cases. Listen and compare 2 Live Crew's version of Pretty Women with the original version by Roy Orbison and decide for yourself.

Additional Copyright Resources

IASPM - Albion EDU - LOC Copyright Office - University of Texas - Standford's Fair Use & Multimedia site - International Intellectual Property Alliance - Friends of Active Copyright Education - Music Library Association - German Copyright Society(GEMA) - Digital Futures Coalition - World Intellectual Property Organization(WIPO) - WIPO 1997 Conference

Last updated 5/13/2002 - Jana Borchardt