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Tuesday, May 18, 2010

Record Labels Suing Everything Good Into Oblivion

Posted By on Tue, May 18, 2010 at 11:57 AM

MP3Tunes' Michael Robertson: "The music industry is still suing ... anyone they even think is taking their business."
  • MP3Tunes' Michael Robertson: "The music industry is still suing ... anyone they even think is taking their business."

"Geeks say greedy record companies hinder innovation"

"Copyright licenses cramp our creativity, techies yelp at 'summit'"

"NorCal biz dudes: SoCal biz dudes think we're shitting on their future but really they're shitting on ours."

Oh, pardon -- you caught me brainstorming headlines for the following piece about the righteous griping session that was yesterday's San Francisco MusicTech Summit at the Hotel Kabuki. What a great group complaint it was! And when I say "complaint," I'm not talking about the mildly inconvenienced indignation you summoned at age 13, when your mom told you to wait for your turn for the family computer. I'm talking about brilliant, middle-aged techie dudes (self-described former garage-band members, many of them) f-bombing the major labels' and copyright holders' demented, greedy grip on the music that many people these days just steal or stream.

And that was just the most interesting panel. Others saw much-earned bitching about the San Francisco Police Department's absurd crackdown on nightlife; about the ridiculous royalty rates that Internet (but not regular) radio stations have to pay; and about the difficulty of innovating new mobile music applications within the stranglehold of wireless carriers.

Other panels on Internet video and futuristic musical instruments were fascinating and cheerful and funny in a non-gallows-humor kind of way. But there's nothing like seeing a bunch of nerdy music lovers gather to curse the recording industry.

Tim Quirk, of music-subscription service Rhapsody -- which pays licensing fees to the record labels for the songs users listen to -- summed up the beefs during the summit's feistiest panel, titled simply, "Music and Money."

"[The labels] charge you more than you could possibly make," the bald, pink-faced Quirk railed. "'[They say,] before you make $10 million, I'm going to charge you $15 million.'"

Quirk said he has long argued that Rhapsody's monthly subscription fee was too high -- it just fell from $15 to $10, and he'd like to see it lowered to $5. But Quirk said a boss told him that the company "'can't charge less than we owe the labels."

Our dispassionate speaker then volunteered his own, deeply considered reading of the situation.

"It's fucking stupid," Quirk impugned, as the room erupted in applause.

News of file-sharing software maker LimeWire's loss in court to the RIAA last week hung heavily over the panel. The ruling is making it difficult to predict the future for LimeWire--as did the fact that Jason Herskowitz, a VP at the company, didn't show up to speak as scheduled. Apparently Herskowitz was seen around the summit earlier -- but only a big, silent piece of cardboard emblazoned with the LimeWire logo filled his seat onstage. (That irony wasn't lost on the packed room.)


In Herskowitz's absence, anyone wondering how it feels to get fucked with by the big-time labels could listen to the irate Michael Robertson. He founded MP3Tunes, a cloud-based "music locker" where all your (presumably paid for) music is available to stream on any device at any time. Cool idea, right? But Robertson's company is still under attack.

"The music industry is still suing ... anyone they even think is taking their business," he griped. "Imeem, LimeWire, Napster ... all these guys had users and content and promise, but they were all sued into oblivion."

Since no big-label rep was there to argue, moderator Eric Garland, of music sales-tracking company Big Champagne, tried to summon a likely response. He imagined a Warner or Sony saying something along the lines of, "If these Internet guys could just figure out a way to make money instead of 'crying poverty,' they could pay us what our music is worth."

Eyes rolled among the panelists. Quirk looked like he might throw up. His response was right on: The value of a commodity is only what the market will pay for it, Quirk argued, and if the market will pay only pennies -- or nothing -- for recorded music, maybe the labels are still living in 1999.

Garland began the conversation with another imagined complaint from the perspective of the Los Angeles-based recording industry, asking the panelists to respond to this statement: "This used to be a great business. Then those guys up the coast" -- meaning here in the Bay Area -- "ruined it."

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Ian S. Port


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