BPI boss Geoff Taylor tells it like it isn’t

Mon,29 Jun 2009 10:00 GMT -4:00 http://www.p2pnet.net/story/24064

- Once upon a time, Geoff Taylor, 41, worked for  Vivendi Universal, EMI, Warner Music and Sony Music’s IFPI (International Federation of Phornographic Industry).

It goes without saying he’ s a lawyer and, for the past couple of years, he’s been head truth-basher at the Big 4’s  BPI (British Phornographic Industry).

In her wisdom Auntie, aka the BBC, Britain’s publicly funded national radio and TV broadcaster, gave him free spin-space through which he dissembles about music industry events during the sue ‘em all years.

The item is also featured on the BPI site where we find, under the headline Ten years of Napster, ‘Dear oh dear. (Brushes away tear.) If only we hadn’t phuked it up when Napster started it all. (Sob)’

That’s the summary, anyway. The full piece kicks off, “Napster was the Rosetta Stone of digital music. Until its release in 1999, few people understood the long term significance of turning sound waves into ones and noughts.”

[Digression #1] The Rosetta Stone is a, “multilingual stele that allowed linguists to begin the process of hieroglyph decipherment,” says the Wikipedia. Thus, In the reign of the new king who was Lord of the diadems, great in glory, the stabilizer of Egypt, and also pious in matters relating to the gods, superior to his adversaries, rectifier of the life of men, Lord of the thirty-year periods like Hephaestus the Great, King like the Sun, the Great King of the Upper and Lower Lands, offspring of the Parent-loving gods, whom Hephaestus has approved, to whom the Sun has given victory, living image of Zeus, Son of the Sun, Ptolemy the ever-living, beloved by Ptah … This is only a partial translation, but it  relates clearly to Napster and P2P filesharing. Should Ptah perhaps be pfffft?

Geoff goes on »»»

Yes, the CD had introduced greater convenience and - to most ears - better sound quality; and the arrival of CD burning put the power of near-perfect replication in the hands of the consumer.

But until Napster, hardly anyone understood the tsunami that would be unleashed by combining the ability to copy digitally with the power of the internet to connect all the computers on the planet.

[Digression #2] The Big 4 still don’t understand, which is why they’re in such deep shit »»»

Napster understood the internet’s potential for decentralised music distribution, and offered it to consumers in a way that was simple to understand and use.

Many critics have argued that the music industry could have avoided some of the problems it faces today if we had embraced Napster rather than fighting it.

That’s probably true, and I, for one, regret that we weren’t [aren't] faster in figuring out how to create a sustainable model for music on the internet.

Legal obstacles

But this view also overlooks the formidable hurdles we faced [created] in 1999.

To make music fully and legally available on the internet [so Vivendi Universal, EMI, Warner Music and Sony Music, and only them, could distribute it] meant clearing the rights in millions of tracks for a huge number of countries, agreeing how the revenue should be shared, implementing workable DRM [Digital Restrictions Management consumer control], developing technology to track all the downloads for royalty purposes [by spying on consumers], as well as creating a [low] quality user experience people would [never] pay for.

In 1999 Napster developed a great digital service, but did so at the expense of music, while the music business protected music at the expense of progressing online digital services. [Cough, choke]

Shawn Fanning and his P2P followers didn’t worry about any of those things, and weren’t prepared to pay fair royalties or to partner in a business model that could sustain investment in new music. [Cough, choke]

[Digression #3] Warner Music Group, EMI, Sony Music, BMG Music, Universal Music Group (Polygram having been swallowed by UMG) thought they could milk Napster dry by reconfiguring it with the same tired and outmoded business model they’ d been flogging in the last century. They wanted to turn the Net into their own private and exclusive marketing, sales promotion and distribution preserve and weren’t going to let anything — including their own customers — stand in the way. Today, under corporate guidance, Napster is a sickly shadow of what it used to be, stumbling and fumbling from one financial and marketing disaster to another. Just like the Big 4 labels »»»

Ten years on, it’s interesting watching other creative sectors [Hollywood] struggling with similar issues. In the meantime, the record industry has [not] gone through a transformation.

Online now contributes 13% of our revenue, we have a whole range of new business models such as WE7, Spotify and Comes with Music, and new ISP services - like the unlimited download service recently announced by Universal Music and Virgin Media - are coming online.

Young, innovative people with advanced digital skills are [not] thriving in music companies and transforming the ways our artists can connect with their fans. The music business is [not] now widely recognised as leading the creative sector in redefining itself for the digital age.

[Digression # 4] There are no creative people working for the Big 4. They’re all corporate drones who do what they’re told —- or else. »»»

New threats

But this innovation, and the vital investment by labels in new music, is constantly undermined by the various P2P successors to Napster.

In 2001, Napster was ordered to stop letting its members share copyrighted music

These companies take and exploit what musicians and artists create, without being honest enough to reward them. And the publishers of books, journalism, films, TV programmes and other media are now [not] lining up with us in the fight against illegal downloading.

Like us, they [don't] see how it will destroy their ability to create new content. So we are united in calling for ISPs to play a more positive role in steering consumers towards digital services that reward creators.

[Digression # 5] To date, despite eye-popping investments in time, money and political resources, the entertainment cartels have completely failed in their bid to have compliant governments compel local ISPs to become corporate copyright enforcers »»»

Some people are sceptical when we say that the music business loses hundreds of millions of pounds of revenue as a result of illegal downloading every year.

A case in point is the recent blog by The Guardian’s Charles Arthur saying “Why does the music industry persist in saying that every download is a lost sale?”

The answer is, quite simply, that we don’t - our figures [supplied by our own creative accountants] are based on a detailed analysis of actual spending behaviour in different age groups.

It is true that some people use P2P for music discovery and spend more on music as a result, but [we'll soon put a stop to that and] in the aggregate they are [most definitely not] heavily outweighed by the number of people whose downloading substitutes for purchases.

If the reverse were true, our business would be booming and not contracting right now.

[Digression # 6] The labels claim files shared equal sales lost. This year, in a 16-page opinion, “District Judge James P. Jones denied an RIAA request for “restitution” in a file sharing case, instead, “holding the RIAA’s reasoning to be unsound,” said Recording Industry vs The People. In his ruling, and discussing the RIAA / Lionsgate “theory of loss,”  they, RIAA / Lionsgate, “assert that for each illegal download of music or movies on  the Elite Torrents network, profits were diverted from legitimate sales the copyright holders could have otherwise made,” Jones wrote, also stating,  “Customers who download music and movies for free would not necessarily spend money to acquire the same product.” »»»

Harm done

There is simply no getting around the fact that billions of illegal free downloads of music every year in the UK mean that significantly less money is coming into the music ecosystem [read Big 4 coffers].

Music companies invest more money into Artists & Repertoire (the music industry’s Research & Development) than any other similar business - over 20% of revenue.

But illegal downloading means that artists are not getting paid for their work , and there is a direct knock-on effect on the number of new bands that music companies can sign and support.

In the long term, this will do [no] serious harm to the strength of music in the UK. That’s why BPI continues to lead the fight for creators’ rights on the internet and ISP responsibility, despite opposition from those who naively believe in an endless free lunch.

Most people in this country agree that musicians have a right to be paid for their work, and most of us want Britain’s unique contribution to the world of music to continue [to the sole and exclusive benefit of Vivendi Universal (France), Sony (Japan), EMI (Britain), and Warner Music (US)].

[Digression # 7] In the US, former RIAA unit SoundExchange collects $$$ for for copyright owners. This year, “why has $101 million stuck to SoundExchange’s fingers?” - wondered entertainment lawyer Fred Wilhelms, going on, “the answer should be obvious; SoundExchange can’t find the people it’s supposed to pay. And even more painfully obvious, SoundExchange doesn’t care. You see, if they don’t find those artists, or those artists somehow find SoundExchange on their own, SoundExchange will get to keep that $101 million all to itself and use it to pay its own expenses. When SoundExchange reduces its expenses, half that saved money can be used to increase payments to artists they HAVE found, and the other half will go to the labels who have registered. Seventy percent of the money which goes to the labels from SoundExchange goes to the four majors who run the RIAA. So the fact that SoundExchange has accumulated $101 million translates into a $35 million dollar windfall for the RIAA, a windfall created completely by SoundExchange’s indifference to its promises to artists. Undoubtedly, however, in the UK, artists get everything they’re owed in full, with no problems, and with no exceptions. Meanwhile, and finally, »»»

In 1999 Napster developed a great digital service, but did so at the expense of music, while the music business protected music at the expense of progressing online digital services.

In 2009, we’ve all learnt our lessons. Napster is now [fails to] run as a service which fairly remunerates artists and musicians, while the music business now [fails to] offers a great range of legal digital platforms.

We are [not] making encouraging progress in harnessing the internet’s unique power to connect people through music, but in ways that also reward artists and the labels that [do not] support them.

Napster was a technological revolution. But the social and cultural revolution that would follow from developing a sustainable ecosystem could be deeper and longer lasting.

“The invention of Napster and all that has followed may soon deliver its greatest legacy,” Taykor adds, “a renaissance in artistic creativity for the digital age.”

No need to stay tuned.

Jon Newton -

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First they ignore you, then they laugh at you, then they fight you, then you win ~ Mahatma Gandhi

BBC - Napster - 10 years of turmoil, June 26, 2009




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