I wrote this as a very-extended comment for a long thread here (trying to be more cohesive than I managed there), but it took me an embarrassingly long time to put it together. By that time, I wasn't sure what to do with it. Rather than losing track of it entirely, I'm posting it here.
I'm going to try to pull in a lot of disparate pieces, and while I'm going to try to focus on music recordings, this'll definitely be a meandering course. Some of it is repeating things I said previously, but in more useful context.
Let's start by getting my bias out of the way. I really detest the major music labels, and their way of doing business. I've seen too many stories like this, this, this, this, and this. And more recently, this, this, and this. And even when suing "for the artists", who got the money? I think it's telling that a google search for "music label screws musician" returns 13M hits. Change musician to artist, and the total grows to 22.7M.
So if I seemed gleeful (or at least blase) about the profit prospects of the recording industry dimming, it's because I see the main loser being the labels, and that doesn't bug me at all.
Yes, some really nice omelettes get made, but an awful lot of the broken eggs are eaten by the chef.
To me, anything that makes labels more enablers for musicians, and less gatekeepers between them and the audience, the better.
But it was good to hear from people here to force me to consider who else gets affected. I'm not sure whether it changes anything here, but it at least gives me more to consider. More information on how people in various professions are directly affected is certainly welcome.
I also have another bias I should probably be up-front about. And that is that copyright, as currently legislated, has gotten way out of hand. Copyright exists to to promote the progress; ie: to encourage the creation of more art. Copyright periods lasting beyond the lifetime of the creator (especially if the creator is (legally, at least) a company, where lifetime, via M&A, can be infinite) do nothing to encourage further creation. In fact, they can easily become a disincentive. If someone can live a very comfortable lifestyle merely by collecting royalties, they're certainly not being given incentive to create more work (and if someone doesn't care about that, and still wants to create more works (kudos to them), then I hope we can agree that the original copyright probably did very little to encourage that person initially as well).
I also do not like the many attempts (mostly successful) to kill off specific technologies in the name of copyright enforcement. The most obvious of those are peer to peer tools. The benefits of using these are ignored in favor of their potential for ill (or at least the perception of that); I shudder to think what might happen when more people realize that email is, fundamentally, a peer-to-peer file transfer technology, and attempt to kill it. And what about technologies like service-provider-located DVRs? One in the home is clearly ok; why does it become not-ok if the device is located in Verizon or Comcast's server racks? What about companies like Aereo, ivi, or zediva? They were attempting to do things that have no fundamental reason to be illegal. And why is cracking DRM, in all cases (ie: even in cases where it is only for the purpose of enabling things that are clearly fair use) illegal?
Internet streaming of music is basically dead. The biggest player there, Pandora, has said that it might never be profitable, thanks to crippling royalty rates. If they're forced to close their doors, due to not being profitable (and really, if they see no prospect of being profitable, I've no idea why they wouldn't), then who wins? And why would anyone try to start one now?
Another problem I see with current law is that so many things are currently out of print. If something isn't in print, it's generally because (Disney's deliberate strategy of pulling movies off the market after X years is the only exception I'm aware of) there's no more money to be made. Those items (and, on average, it happens after less than five years) are still protected until we're all long dead and gone. That's certainly not promoting any progress. There is no winner from that, but there is certainly a loser (and the loser could be the artist; Moby Dick wasn't recognized as a great book until long after it was published. IIRC, it was 40-ish years later that it got noticed). Releasing things from copyright sooner would allow those titles to not be forgotten, and increase the odds of such late recognition. My pet idea for copyright term would be for 10 years or so for free, and then an exponentially-increasing fee to keep it protected after that (starting at a fairly nominal amount: $100, adjusted for inflation, say. Then increasing by, say, 20-50% every year). That way money could still be made, but everything will make it into the public domain in a finite length of time.
So, with those biases out of the way, let's move on. A lot of the anti-piracy rhetoric focuses on morality, and how customers should be consuming the media. The particularly pernicious element is the equating of copyright infringement with theft. Let's look at that from several angles. First, as I earlier pointed out, there are separate laws for copyright infringement and theft. If they really were the same thing, there would be no need for separate laws.
In fact, there are several very strong arguments that they are fundamentally different. The first is that, with copyright infringement, nothing is actually taken from the one whose works are infringed. There's no question that taking something from someone else is wrong. It's morally obvious. If copyright is just as obvious, rather than being a social contract, then why is copyright addressed in the Constitution, when theft is not (nor is murder, for that matter)? Even more to the point, why was federal copyright not seen to apply to sound recordings at all for many years (until Feb 15, 1972, as near as I can tell)?
The latter leads to two important points. The obvious one is why following copyright would be a moral imperative now, when it wasn't then. But the other point is that it begs the question of whether copyright is even needed for making money, because the music industry certainly made money before that (if I'm wrong about the date, it could weaken this latter point, but not eliminate it).
A common refrain goes along the lines of: "but the work was done. Copying requires payment." If a physical product is made, for which there is no market (think things along the lines of "New England Patriots, 2012 Super Bowl Champ" T-shirts), do they put them in the store, and insist that customers are morally obligated to pay for them? No, there's a recognition that nobody will pay, and the shirts are given away. Yes, music isn't something for which there is no market, but the root of claiming that payment needs to be made because the work was created is the same. And at the risk of belaboring the point, note that the companies making those shirts are explicitly losing money. There was a tangible loss, there, unlike in the case of an unauthorized download (where any loss is merely theoretical).
Another part of the moral argument has to do with culture. The problem is that culture needs to be, you know, shared. It can only be defined with regard to social norms. And those social norms must be defined by shared experience and beliefs. And, fundamentally, piracy is a question of sharing. If it can't be shared, then it's kind of hard to call it part of culture. So this discussion of owning that culture, to me at least, is very similar to saying that a private individual should own the Washington Monument or Mount Rushmore.
That certainly doesn't mean that I don't think people should be able to make a living in media creation; but I'll come back to this.
To those who would argue that there is only loss in copyright infringement, let me mention a specific case I know about where there is gain in infringement. Fans make subtitled versions of Japanese anime, and distribute them via BitTorrent, because they like the shows, and want to introduce them to others. Stealing from the Japanese, right? Well, the professional (US) translation companies monitor those sites, so they know which shows are popular, and therefore, which ones are worth licensing (ie: which ones will sell). The fansubbers reciprocate by pulling the torrents when shows are licensed.
Some of the other arguments I've heard focus on tech companies, saying that, for instance, Google should share its money with the music labels. The business of a search engine is to find what people are looking for. If they fail to do that, then they won't be used. So saying they should just change results returned (which I've occasionally, though not here, heard suggested) is a ridiculous suggestion. (And I think them factoring DMCA takedowns into their rankings, as they've recently agreed to do, is going to bite them in the ass, for exactly that reason. Not to mention that it is, again, punishing sites for accusations of wrongdoing, not for proven wrong-doing.)
It was pointed out that 10% of search engine searches are music-related. Assuming that to be true (and frankly, I'm skeptical of it even being possible to come up with a number for that), what is the suggestion for what should be done? Google doesn't make a penny off of most searches. In fact, they only get paid if a link that someone paid for is clicked as the result of a search (note: even if that same site is called out by Google's algorithms, if the "organic" result is clicked, instead of the paid one, then Google makes no money). The fact that Google can make money that way shows that driving traffic to a site is a valuable service.
So, to those who would advance that argument, a question: if, say, a music retailer pays for a link, and it gets clicked, should the music maker (assuming that can be determined, or via some sort of payment society) get paid also? Even though the retailer is trying to sell the music maker's products? And assuming the answer was yes, should the music maker be paid even if Google ends up helping the searcher find a site through a non-paid link (ie: should Google be paying, even though they made no money on the transaction)?
But let's look at the question of "music-related searches" a bit more closely, and some other issues that have to come up. First of all, what qualifies as a "music-related search"? Is 'abba' a music-related one? Well, Google's results indicate that that's likely, but, among many other possibilities, are that you are looking for a Biblical quote, the a religious title, an LED lighting company, adoption in Canada, heavy equipment leasing, or for a University or a town or a hotel or a different hotel or another hotel (and yes, if anyone is wondering, those did all come out of the results of a search for abba). Would the same person (whoever that is) be paid (assuming I'm looking for a song) if I go to the music video, or an audio stream of the song, or the lyrics, or the sheet music, or a book containing the sheet music, or a CD? What if the song isn't available in my country?
And then there are some more things to consider. Should they also pay movie studios for movie-related searches? What about authors for books? What about authors of random web pages (those are copyrighted also). Does it mean that people who just started out get shafted, and the big names get all the money (a la ASCAP/BMI)?
Any argument that doesn't result in paying the page to which the search went is fundamentally an argument that the search engine needs to track what the search is related to, which, as shown above, might not be possible to determine. Google provides so many results because they fundamentally CAN'T know.
Which leaves you with basing it on the page to which people go. But Google has already provided a service for that page. They should pay for providing help? That's quite a slippery moral argument, itself.
Not to mention, getting back to the question of where the search goes. If it goes to a youtube video, is the person looking for video or just for music? Heck, maybe they just like the person doing the dancing. Again, it's hard to say.
I think the music industry needs to just stop those arguments, and try to use the services provided. Bandwidth too expensive? Put your music on Megaupload, and point your fans there, as Dan Bull did. Or use BitTorrent for your distribution. The more demand you have, the more bandwidth that gives you. Searches aren't going to your pages? Do some work to try to make it so they do (and since the largest single factor in that happening seems to be how many external pages point to your page, do the work to put what somebody searching for your terms would want, so that other people will WANT to link to you). I know some degree of this is going on with youtube (at least for movies; I don't know about music), and that's a step in the right direction, but there needs to be more.
As I said earlier, search engines drive traffic. Put yourself in a position to get that traffic, then take advantage of that traffic, somehow. Make Google your friend, instead of acting like it's out to get you (when Google really couldn't care less about you, one way or the other).
There's also the argument (that I've heard here and elsewhere) that technology companies should know that they're engaged in nothing but thievery. This is ignoring several important issues. One is all the previous cases of new technology coming along, where the content industries made very similar arguments. Another is that it ignores other potential uses of those technologies. The Supreme Court's rationale of "substantial non-infringing uses" in the Betamax decision was a recognition that there is significant public good in being able to try out new business models even if they might have deleterious effects on existing industries.
In a bit of irony, when I listed those earlier examples of technology shifts, I forgot to mention recorded music itself. Yes, the music industry actually argued that recorded music WAS a threat, because it would destroy the sheet music industry. Well, it did. How did that work out for everyone? To be clear, I don't think the recording industry is going away, but insisting that it can't change is just pissing into the wind. If it does go away, it'll only be because it's been replaced by something better.
The most important point of the last two paragraphs is to note that, in all of the cases cited (except, perhaps, the telephone, which might merely be neutral), the industries made vastly more money once they embraced the technology in question.
The music industry, just like every other business in existence, is about providing value to the customer. If the customer doesn't feel value is being provided, they won't pay. If there is value, all evidence says that they want to support the musicians. Maybe not by buying recordings (that's less clear, although iTunes sales numbers argue strongly that it isn't an absolute rejection of recordings), but they do want to. (If you don't believe that, and you want to make music for those people you don't think want to support you? Well, I can see no alternative to you being either crazy (in a clinical sense) or stupid.)
But what really irks me about much of this discussion is the practical side of suggested solutions. Most of it has to do with the thinking that, "You know the content is pirated". But the simple fact of the matter is that a company doesn't. I listed most of these before, but here's a bunch of the problems with that (this is everything I could think of, but I do not claim this list is exhaustive).
1) There's just too much of it. Youtube gets an hour of new video every second of every day. To keep up with that in real-time (and ignoring that the rate is increasing), Google would need to hire over fifteen thousand people just to watch it. And that's assuming that copyright status can be determined as quickly as something gets watched. And those people would need to be trained lawyers. It'd certainly be good for law schools (and the current job market for lawyers), but it would cost around half a billion dollars per year (assuming lawyers working at $33k annually, which is obviously quite low). And that's just one site. And only looking at US copyright laws. You'd need separate teams to do the same evaluations in nearly every country of the world (or an extensive training program for the evaluators).
Now let's look at the factors in determining whether something infringes:
1) Is the work even original enough for copyright protection? In a computer graphics class, we were required to post videos of the execution of our code (exploring a 3D space, IIRC). Those probably wouldn't qualify at all (but maybe they do, if the programmer put a lot of effort into how it looked in doing that exploration). This is a step that requires a lawyer. And might well vary from country to country.
2) Next, you need to accurately identify what the media is. When all you've got is a filename, and it's something like Vacation_video_summer_2008.avi, you have very little to work from. What if it's something like 'batman.avi'? Which episode of which TV show is it, or which movie? Or maybe it's a slideshow of scans of the comic book. Is there an easy, automatic way to figure it out? (There is a partial solution to this on Youtube, called ContentID. But that requires help from rightsholders, and can easily step on legitimate postings. False positives are a very difficult problem.)
3) You need to know whether the media in question is under copyright. Here's a flowchart about how to determine that. Yes, theoretically a database could be created to solve that part. Except that copyrighted material is expanding faster than any database could possibly keep up with. (The copyright office has somewhat of a database, but it hasn't been entirely digitized.)
4) You need to know who the rightsholder is. (which again requires that you've correctly identified the material. It also requires that you can identify both people. Dave Clemmer might not be Dave Clemmer, as we already saw.)
5) You need to know whether the person doing the uploading is the rightsholder, or whether the person has the permission of the rightsholder. A likely special case of this is open source or creative commons-licensed media. Can you look up the license?
6) If there is use of copyrighted material, but it isn't an exact copy (and note that, in this case, you need to not only determine whether this material is copyrighted, but what it resembles. Good luck with that, even working by hand), then you need to consider whether the use is transformative. Someone with more experience could probably do a better job of an example of this, but think something along the lines of creating a sculpture based on a painting. This is a step that not only requires some training, but upon which trained people can disagree.
7) Finally, if you're still not sure, you need to do a fair use/fair dealing determination. This step also requires a trained lawyer. This is also the step that will vary the most from country to country. Eliminating this step is moving from "presumed innocence" to "presumed guilt", legally. That's a step I'd tread very carefully over.
Another part that bothers me is the treatment of "pirates". Suing individuals was incredibly stupid and short-sighted (and unprofitable, thankfully). But it appears that the only thing learned is that the PR hit needs to be shuffled off to others (the FBI, primarily). And if that pushes the costs off onto the government, even better. And suing companies is playing a game of whack-a-mole that can never be won ("I got this site, on to the next one." Lather, rinse, repeat. Until you find that the sites are all hosted in countries that don't give a fig what the US thinks. It's especially pernicious when the behavior doesn't break the law in that country (like several cases of going after people/sites that only link to content, where such behavior has been found legal by obscure countries like the UK or Spain. Look up Richard O'Dwyer or rojadirecta (the government finally gave up its case there, thankfully), respectively, for examples)).
Yet another approach is (as far as I can tell, mostly "was" for the music industry) the use of DRM. Aside from the fact that these are quite insulting to consumers ("thank you for paying the money for my product; I think you're going to use this criminally, so I'm going to limit what you can do with it"), it was also dangerous in several different ways. One was the literal attacks on consumer's computers (see Sony rootkit debacle). Another was the approach in the DMCA that forbade research into evading DRM. Forbidding education (which is what research is) is, quite frankly, a nearly unforgiveable sin in my book. All DRM that I've heard details about are just cryptography problems. Generally implemented quite badly, from what I've seen, but the point is that it's blocking research into certain cryptography problems. Exploring how other people have solved a problem is how one inevitably starts learning about that problem. So that's another threat to the technology industry.
It was also, in some implementations, quite the screw-job of the customer. It was used in Wal-Mart's and Microsoft's online music stores, and everything they sold became unplayable when the stores went offline.
And everything pointed out in those two paragraphs ignores the biggest point of all: DRM did nothing to stop piracy. All that DRM'ed music was still available online. Sometimes before it was even available from authorized sources.
Plus, as noted recently, the bulk of "piracy" is occurring offline or peer-to-peer. And those can only be tackled via massive, and extremely intrusive, surveillance. It can be hindered with serious blocking of internet traffic (although those hindrances can be avoided via tunnelling), but not stopped. To really block it would require packet inspection. And, of course, that would eliminate legitimate uses of the technologies (I use bit-torrent regularly to get (and seed) linux OS images, for instance).
Even further, the attacking of "pirates" eliminates business models that do have legitimate uses. For instance, cyber lockers would be one cheap way to do offsite backups. If I were to do that for my personal hard drive, for instance, there would certainly be a lot of copyrighted material uploaded, but nothing illegal would be going on.
As a bit of a side note, I also talked about a quote from Regina Spektor, about online sharing giving poor people access to music. I wasn't saying that her quote was saying it was a moral imperative to do so (which I think is how it was taken), just that I liked it because it recognized the potential benefits to doing so.
Moving on, one sign of the problems of file sharing that T Bone mentioned was writers getting the shaft in a serious way from the movie and TV studios in labor negotiations. I must admit that I'm not seeing the connection there; it seems of a piece with the short-sighted union busting and unfair cost cutting going on across the corporate spectrum in the interest of short-term profits and driving all money into as few hands as possible (it was pointed out to me earlier today that some of that is driven by leveraged buyouts, as well). Copyright infringement might be the excuse used, but I have trouble seeing it as anything more than that. (Although, to be fair, I'm not sure what it would take to convince me of a real connection. A studio head saying it publicly, for instance, would certainly not convince me.) And the specific case cited seemed largely driven by unscripted "reality" shows removing almost all leverage for TV show writers. I certainly don't agree with what happened, but again, don't see it as having anything to do with copyright at all.
I mentioned the movie studios making large amounts of money. Here's what I've found for the last ten years for income.
I don't know about breakdown of major studios vs independents, but here's what I've found at boxofficemojo.com for titles by year over the same span (remembering that 2012 isn't finished, of course).
Year - Titles - Gross
2012 - 428 - $6.9B
2011 - 601 - $10.1B
2010 - 535 - $10.2B
2009 - 521 - $10.8B
2008 - 608 - $9.7B
2007 - 631 - $9.7B
2006 - 608 - $9.2B
2005 - 547 - $8.8B
2004 - 551 - $9.3B
2003 - 506 - $9.1B
2002 - 479 - $9.2B
And here's what I've found for titles (feature films) per year over the same span on IMDB. Obviously, this is not only large and small studios, but also international ones (and probably includes shorts, as well). But the trend in this data is very clear. (And note, of course, that 2012 isn't even finished yet.)
Year - Total - in US
2012 - 9281 - 4369
2011 - 7801 - 3068
2010 - 7041 - 2785
2009 - 6735 - 2790
2008 - 5588 - 2065
2007 - 4805 - 1694
2006 - 4566 - 1616
2005 - 4202 - 1457
2004 - 3754 - 1157
2003 - 3590 - 1093
2002 - 3709 - 1164
So, I don't really see pursuing piracy as anything more than a distraction from the business of... well, business. I certainly don't see it as a moral issue to kill the practice. And I don't see anything to celebrate in what is happening to Megaupload. The number of ways "justice" was contravened in the idea of shutting down the site are numerous, and far more damaging to society than any amount of copyright infringement. Is pursuing copyright violations really more important than constitutionally guaranteed rights of free speech, due process, and presumption of innocence? Because the megaupload shutdown has problems under all three of those rights. (As does the dajaz1.com shutdown, which I earlier referenced.)
So, in the interest of being more than just a critic, the question becomes, where do I think things should go from here?
I gave a couple of vague ideas up above. Another one that isn't too specific is to get rid of regional licensing for music. That's an idea that might have made sense twenty-five or fifty years ago, but makes none at all now. At least not with digital distribution (I'm not as sure about physical products). In fact, regional licenses are a major hindrance, as it means that pirated copies are far more likely to be available before authorized ones.
How do you beat piracy? You make a better product, or you make it more convenient to buy, or you find another reason to give the consumer a reason to buy. One that I thought of, that gives up on the convenience, but makes piracy completely irrelevant, is to give personal intros to songs. Yes, how much that would be worth would be directly proportional to how popular the group is (I have no idea how much you'd have to pay the Stones to do that sort of thing for instance, but I'm sure it would be a ridiculous amount). But think of it this way, if it makes it onto the file-sharing networks (and I tend to doubt it would, frankly), who cares?
How else do you make money on recordings? Freemium is one way, that some are using successfully. Another that I've heard about is releasing unfinished pieces (each instrument's track, separately, for instance), and allowing people online to make their own mixes. Another idea I've heard is abandoning the album model entirely. Not being a musician, I'm not sure where I'd go with that, but much more frequent releases of individual songs is one thought.
Another way, I think, is to save money on the recording process. I envision avoiding the contract repayment stipulations referenced above by initially making do with a cheaper mastering process (I'm told, and feel free to correct me if I'm wrong, that a fairly cheap home studio can sound pretty similar to what a high-end studio could do not that long ago). And then, if they felt it was worth the cost, see about financing time in a top-end studio via kickstarter. A lot less risk exposure to the musicians that way. Plus, it gets the fans more involved in the process, which is always a benefit. An expansion of that idea, that just occurred to me, is that you could offer levels of support, and one level could be to be present for that recording process (better cap the number of people who can do that :). Another level could be to be credited somewhere.
But the big gains, I think, will be looking for complete alternatives, and it should be pointed out that these are envisioned to help bands of different sizes. Also, some of these depend very heavily on the artist wanting to do them; don't force a neurotic loner to do some of them.
One that I saw was the ability to spend a day with the artist. The particular case was to spend it at Disneyworld, which had special meaning for that artist (sorry, I forgot who it was).
Another, that could be set up via some combination of twitter and kickstarter, would be to do impromptu concerts (maybe at a local park, or some such). I doubt that would make a lot of money, but it would probably make some (and kickstarter would allow you to, more or less, guarantee that), and would be a good way to connect with fans.
Yet another idea would be selling backstage passes (I believe they are currently given away to family/friends/business partners, etc. Is that not the case?). Again, giving a chance for fans to feel (or, in this case, be) close to the artists. Another that could be combined with concerts would be personalized T-shirts (like those stands in the mall, except in the concert venue, and perhaps with the shirts customized with date and venue (instead of just showing the whole tour).
Anyway, as I intimated a number of times, I don't see that as being anything close to an exhaustive list, but all pieces of the puzzle that can potentially make up the slack. (I say that somewhat tongue in cheek, because as a number of those links above showed, there is little, if any, slack from the artists' perspective.)
I think that about covers my thoughts on copyright and piracy, but as a bit of a detour, there was also some talk about file formats. I perhaps jumped on something that I shouldn't have commented on, due to lack of detailed knowledge, but let me think out loud for a minute or two here. One important point was that I was purely talking about digital play formats, rather than, say, disk formats that are a lot harder to get into wide acceptance (I am, sadly, aware of the fate of SACD and DVD audio). I have no idea of the licensing hell that would, perhaps, ensue from this, but has any thought been given to an app-driven solution to distribution? That is, a format that plays in a custom app on a smartphone. And in which app new tracks could be purchased?
But wait, didn't we agree that the electronics for playback is, pretty much, shit? Well, two things about that. One is that I am assuming (and admitting it's an assumption; I don't think I have the equipment to test it) that sending output via an iPhone's HDMI output is considerably better than using its headphones. Certainly, there's a win there insofar as multichannel output is possible (although, thinking about it, you could do multichannel out to headphones, as long as you know you're going to headphones, if you want to do the channel-combining logic in the app). The other is the thought that it might be possible to get an iPhone or Android phone made with higher-quality components. That's one place where I don't know if the market for it is big enough to make that economically viable; I know a few people who'd be willing to pay for it, but it isn't a huge number, for sure. Especially given how disposable phones are for most people.
Maybe it'd make more sense to do, instead of or in addition to that, a component that plugs into a receiver. Maybe with video output for visualizations or videos, and to allow online browsing and purchasing. And, of course, if that's in addition, then it better be easy to synchronize (whether via cloud or direct transfer) with the smartphone.
Another idea that came out of the earlier discussion was about appreciating good quality sound. There's certainly some degree of not caring from a lot of people. In fact, from what I've heard, surveys that are done indicate that few, if any, people can reliably (ie: in double-blind tests) distinguish between compressed and uncompressed formats of sound. So I wondered if it would be possible to put together a package in the highest quality available (uncompressed blu-ray, I believe?) that would point out what to listen for. Educational audio/video for the ears, as it were. But the idea would be to play the highest quality available side by side with compressed audio, to show exactly where the differences are.