The Internet As Jukebox, At A Price (NY Times article)

I'm posting the article here as well as the link, cause I know some of you don't have a user name and password at New York Times, which you need to read this article.


STATE OF THE ART
The Internet as Jukebox, at a Price
By DAVID POGUE
New York Times


efuddlement (n.): 1. Confusion resulting from failure to understand. 2. Loss of sense of direction, position, or relationship with one's surroundings. 3. The state of the recording industry as it tries to sell music on the Internet.

THE only thing record companies know for sure is that they want to kill off the insanely popular Sons of Napster: free music-sharing services like KaZaA, Gnutella and Morpheus. After all, the millions who use these services are in effect stealing music, depriving the five major labels of perfectly good money. But watching the record companies as they try to find a formula for a successful paid alternative is like watching five people play blindman's bluff on stilts.

At least they're generally crashing in the right direction. This is a busy time for improvements in the music-downloading services: America Online unveiled its MusicNet service last week; Pressplay has launched version 2.5 of its software; Rhapsody has unveiled a 49-cents-per-song special; and a new service called MusicNow, which offers a fresh approach to finding music, will make its debut later this month. With each development, these companies (and another MusicNet affiliate, RealOne MusicPass) are gradually lowering prices, filling the holes in their catalogs and loosening the restrictions on what you can do with the music you've bought.

Unfortunately, one thing that has not changed is the complexity of their price plans, which make choosing a cellphone plan look like child's play. Each company offers several degrees of freedom for the music it sells, each priced differently.

The most basic freedom is listening to songs while your Windows PC is online. It's a lot like one of those free Internet radio stations, except that these "stations" are commercial-free and, in some cases, customizable.

The next level of freedom is the most bizarre. In some plans, you are allowed to download songs to your PC's hard drive for playback even when you're not online. (Companies call these temporary, conditional or tethered downloads.) But you're only renting these songs, not buying them. If your subscription to the music service expires, your music files expire too, turning into worthless kilobyte carcasses on your hard drive. It's like having a landlord blow up your apartment if you miss a month's rent.

Finally, for an extra fee, most services let you download selected songs - called portable or permanent downloads - directly onto a blank CD. At that point, you own them forever. You can mix and match songs from different bands, dictate the playback order or build your own versions of hit CD's, minus the annoying songs.

You still can't move these files to another computer or e-mail them. Nonetheless, this approach is the closest the music services have come to a compromise between what music fans want (flexibility to use what they have bought) and what the record companies want (preventing file swapping).

Yet the music services don't mind admitting that if you have the time and the right music utility program, you can "rip" the songs from the newly burned CD right back onto your hard drive. Presto: standard MP3 files that you can back up, share with others or copy to a portable music player.

Most of these services are essentially giant databases. You search for a song, peruse the search results, and click on a song title to hear or download it. Rhapsody, Pressplay and MusicNow spice up the service with articles and recommendations. Pressplay 2.5, in fact, includes audio versions of Billboard magazine best-seller charts going back 45 years - an intriguing way to study the development of popular music.

Most of these services offer pretty much the same 250,000 songs because they have all struck deals with the same major record companies. That's certainly enough music to cover, say, an aerobics workout, but it is by no means every pop song every written. You'll encounter big holes in the Billboard Top 100 list, for example.

Worse, some of the biggest performers, or their agents, refuse to play the online-music game. You won't find much of anything from Madonna, Led Zeppelin, the Rolling Stones, Pearl Jam or the Beatles, for example. (Pressplay does list a rendition of the Beatles' "Yesterday" - played on panpipes. The Beatles' agent sure has a funny sense of licensing priorities.)

Even if you do find the song you're seeking, the little "CD-burnable" flame icon next to its name is missing on about half the songs in most services' catalogs. In other words, you can listen but you can't download it to own. Pressplay claims that "well over 90 percent" of its catalog is burnable, but even there, you can't buy anything from Britney Spears, 'N Sync, Aaliyah, Mos Def, and other current hit makers.

Most of the differentiation among the services, then, boils down to their software design and pricing. The RealOne plan, for example, comes with typical Real software: complex, cluttered and riddled with ads. It stocks only 100,000 songs-a fraction of its rivals' libraries. It is also the worst deal, charging you without selling you anything that you can keep. The company says that an overhaul is in the works.

AOL's new service, which like RealOne is a spinoff of the MusicNet library, is clean and extremely easy to use, and AOL customers can savor the simplicity of being billed for music on their AOL statements. But the software design is spartan to the extreme; you can browse music only by performer name, not by album or category. Worse, the $18-per-month plan buys you only 10 burnable songs each month; it will take you two months to accumulate enough songs for a single CD.

Clearly, most people would prefer an unlimited, à la carte system without hassles or limits. That's the beauty of the plans devised by Rhapsody and MusicNow: $1 each for as many songs as you care to download, on top of the monthly $5 or $10 fee.

MusicNow is designed more like a radio station than a spreadsheet. Instead of searching for a particular song, you begin by choosing from a list of 40 channels: Indie Rock, Electronica, and so on. (Older listeners may be gratified to discover categories like Film Scores, Show Tunes, and Holiday Music, all glaringly absent from rival services.) You can listen to these channels as you would the radio, or, if you prefer the database approach, search for and buy individual songs for $1 apiece. All of the action takes place within Windows Media Player 9, so you don't have to learn another proprietary piece of software.

MusicNow claims to be uninterested in the usual audience of young MP3-file collectors. Although its prerelease software is a bit slow and wobbly, it may become a welcome, more grown-up alternative to the database-like services.

Rhapsody offers a similarly friendly software design, which includes a feature that lets you build a radio station that plays only your favorite singers. Until March 31, CD-burnable songs on the $10-per-month plan cost only 49 cents each - a good argument for making this the first music service you try. Its one significant liability is that none of the songs in Sony Music's catalog are burnable.

Pressplay is similar, except that you have to buy your burnable songs in blocks of 5, 10, or 20. But in addition to well-built, speedy software, Pressplay offers a huge, exclusive perk: You can copy your purchased songs straight to a CD, Sony Minidisc or - and this is the big one - to many popular portable music players. (Alas, the best-selling Apple iPod is not among them; it doesn't recognize WMA files, those in Microsoft's copy-protected music-file format.) This direct-to-player feature is a big improvement over the burn-to-CD, copy-back-to-PC, transfer-to-player ritual required by the other services. (MusicNow says that a similar feature will transfer songs primarily to hard-drive-based players.)

No matter which service you try, you'll almost always pay more for an album's worth of music than you would by buying a CD in the store. Furthermore, none of these services exploit the virtues of the Web by including lyrics, tour dates and other news.

Nonetheless, these commercial music libraries would seem like amazing, groundbreaking inventions if only they didn't follow other, more amazing and groundbreaking inventions: KaZaA and its ilk, sites where every song is available, burnable and free. You never have to wade through the complexities of the prices and rights matrices. No wonder people have stayed away from the commercial libraries in droves.

If the tide is finally starting to turn, as the record companies fervently hope, two forces are at work. First, somebody is poisoning the well at the free swapping services, trying to waste music fans' time by uploading mislabeled, truncated and sonically garbled versions of the most popular songs. (The culprits aren't identifying themselves, but unhappy music fans think they have a pretty good idea who's at work here.)

The second force is the gradual refinement of the commercial music libraries. They're gradually filling in the musical holes, simplifying pricing and stumbling toward a business model that isn't quite as repellent to consumers. Almost everyone expects that they'll find that formula someday; it's all about defining the terms.
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Well at this rate maybe by next year or 2005 the record companies and the legit on-line servives will get all the kinks ironed out. Then I might consider signing up for one of these services.

Up next, some information my librarian brother passed on to me the other day about Canadian music copyright laws. Some very interesting finds about what we are allowed to do with making CD backup copies and such. Gary, John, Graham, get out your note pads.

Also one of his collegues did some reearch on OOP items and passes on a note to us about that.

 

Interesting. But its WAY to complicated for the average Joe right now. When its "just easier" to use Morpheus, thats what people will do.

 

From my brother's collegue.

In Canada, copyright goes like this. I don't know the US info well enough to comment, but don't think there are any special rules for out-of-print material.
Essentially, out-of-print status doesn't change much in terms of giving a person permission to make a copy of a whole work, be it print or sound. Copyright still applies under life of the author plus 50 years, or 50 years after the making.

Libraries (not individuals) are allowed to make a copy of deteriorating/damaged materials, or to change the format of a work if the original is in an obsolete format, where a copy is not commercially available - this could mean though that if abebooks has a used copy, it would be seen as being commercially available, and we would have to buy it rather than making a copy. I am not familiar with any library that has changed the format of a sound recording using the argument that the format or technology is obsolete.
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My brother's recent find on downloading and/or copying CDs in Canada.

After our latest "discussion" about downloading and burning copyrighted music onto CDs, I did research on the weekend, trying to find information that backs up my feeling that copying copyrighted music for private use is legal in Canada. I was surprised to learn that in Canada, this has been the law since 1998, when the Copyright Act was amended.

Bottom line: private copying of music is legal in Canada , and does not infringe copyright, as long as certain conditions are followed. Compilation tapes or CDs, even copying complete albums, is legal, again, under certain circumstances. (Personally, I don't like copying complete albums.) In addition, levies are placed on the sale of all blank cassettes, CD-Rs, CD-RWs, etc., and are collected by the Canadian Private Copying Collective. The CPCC has yet to distribute any moneys to copyright holders of music, but it intends to begin this year. Among the groups represented by CPCC is SOCAN, of which I am a member. (My brother is professional musician as well [guitar]. He is also a member of the musician's union.)


This next section is fairly detailed in legalese. You may want to skip it and move to the interpretation section below it.

Some details from the CPCC web site

Private copying is the subject of Part VIII of Canada's Copyright Act. It has a very specific, and limited, meaning. A "private copy" is a copy of a track, or a substantial part of a track, of recorded music that is made by an individual for his or her own personal use. A compilation of favorite tracks is a good example of how people typically use private copies. In contrast, a copy made for someone else or for any purpose other than the copier's own use is not a private copy. Nor is a copy of anything other than recorded music. And private copying is not an example of "fair dealing", a very different legal concept. In Canada, private copying is legal and does not infringe copyright. It is because, in exchange, copyright holders in recorded music have a right to receive compensation in the form of royalties for private copying.

Private copying is the subject of Part VIII of Canada's Copyright Act, the federal statute that sets down the general legal framework for copyright in Canada. Copyright is the legal mechanism by which those who create original works, like music, are able to be paid for that work. As copyright holders, creators have a right to control certain uses of their work, and place conditions - like payment - on use by others. These payments take the form of royalties. To illustrate, performance of a song, a record sale or printing a musical score are all events that would trigger a copyright royalty. But unlike a publishing or record deal, private copying cannot by its very nature be managed and accounted for by contract: private copies are made spontaneously by people in the privacy of their own homes. That's why private copying receives special treatment in the legislation. Permission does not have to be sought; private copying is simply permitted. But in exchange, the Act sets up a system to collect and distribute royalties to those with rights in the music that is copied. True to general copyright principles, legislators have ensured that creators and others with copyright in recorded music are able to be paid for use of their work.

The very important topic of royalty distribution is addressed in Part VIII of the Copyright Act. Like collection, responsibility for distributing private copying royalties rests with copyright holders directly. This is because private copying royalties are not monies collected for public purposes but income for individual copyright holders. For practical reasons, the Act also stipulates that distribution be handled centrally, by a body designated by the Copyright Board. In all of its decisions to date, the Copyright Board has assigned this role to the Canadian Private Copying Collective or CPCC. CPCC is an umbrella organization that represents songwriters, recording artists, music publishers and record companies -- the groups on whose behalf private copying royalties are collected.

The Copyright Act identifies the general types of copyright holder on whose behalf private copying royalties are collected and which are eligible for payment. Songwriters, music publishers, recording artists and record companies - those with rights in the music copied - are all eligible. While songwriters and music publishers are eligible regardless of nationality, only Canadian recording artists and record companies may receive payments under current law.

Responsibility for distributing private copying royalties rests with CPCC, the body that also collects the royalties. This is a role assigned to CPCC by the Copyright Board. The Copyright Board also designates the proportion of total royalties that will form the basis of distributions amongst each of the three basic groups eligible to receive payments: songwriters and publishers, recording artists, and record companies. Like the assignment of responsibility for distribution, these allocations are set down in the private copying tariffs. From there, CPCC must divide the funds amongst individual copyright holders. Conservatively, one song will trigger as many as 12 payments. Although it has taken similar but bigger organizations in other countries far longer to effect their first distributions, CPCC is poised to begin making payments in 2003. Over $28 million are now available for distribution, representing private copying royalties collected during 2000 and 2001. CPCC has devised a process that will permit these funds to be distributed fairly amongst tens of thousands of copyright holders. A non-profit corporation run by copyright holders, CPCC withholds only those funds necessary to defray its costs of administration.

The Copyright Board of Canada has listed the 2003 Interim Tariff of Levies to be collected by the CPCC. The section of the Copyright Act that confirms that reproducing, i.e., copying a section, subsection, or all of a musical work, for private use only, is legal, is found here.

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Copying for Private Use

80. (1) Subject to subsection (2), the act of reproducing all or any substantial part of

(a) a musical work embodied in a sound recording,

(b) a performer's performance of a musical work embodied in a sound recording, or

(c) a sound recording in which a musical work, or a performer's performance of a musical work, is embodied

onto an audio recording medium for the private use of the person who makes the copy does not constitute an infringement of the copyright in the musical work, the performer's performance or the sound recording.


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Some interpretations of the copyright act

The wording of the Copyright Act gives rise to some very odd situations. In the 6 examples below, "commercial CD" means a commercially pressed CD that you would normally buy at a retail store.

If someone steals a commercial CD, steals a blank CD-R, and then copies the commercial CD onto the CD-R, they are a thief, but they have not infringed copyright.

You can legally lend a commercial CD to a friend, give him a blank CD-R, let him use your computer, and help him burn the CD-R which he can keep for his own private use.

You can legally copy a commercial CD , keep the copy, and give your friend the original.
You cannot legally make the copy yourself and give your friend the copy.

Your friends Alice and Benoit really like the new commercial CD you just purchased. Alice borrows it and makes a copy for her own use. She then passes the commercial CD on to Benoit, who makes a copy for his own use. Benoit gives the commercial CD back to you. This is all perfectly legal.
However, if Alice had copied the commercial CD, given it back to you, and passed her copy on to Benoit to make a copy for his own use, then copyright would have "probably" been infringed. There is some doubt here because Alice's original intent is important. In the strictest terms, her copy was no longer just for her private use. Pretty strange considering that the end result of examples 5 and 6 are exactly the same!
The Canadian Coalition for Fair Digital Access is fighting the levies, which are to be increased this year.

This was an interesting exercise for me, and I thank you for essentially motivating me to put my money where my mouth is/was/will be. I knew about the levies, but I wasn't aware the Cdn Copyright Act had been amended in 1988 to legalize copying of copyrighted music. This makes sense to me - realistically, very few people can afford to buy every CD of music they like, CDs that might only have the one song they like, rather than have the ability to make compilation tapes or CDs. It's the people that do this and try to make a buck from it that are breaking the law. The CPCC has $28,000,000 on hand to begin distributing to affected artists this year. I don't know how they will do it, but I've never understood how the Cdn Copyright Licensing Agency distributes compensation to authors in the same fashion.

And so on....
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Well there you have it. I can legally make a back up copy of my rare Steve Hoffman mastered Amboy Dukes CD for my vehicle, so if it ever gets broken into all the thief gets is a CD-R.

It would now be interesting to find out what the U.S, U.K. and Australian/New Zealand laws are like. Maybe some of you out there would like to tackle that for us.

 

Amy Grant has even said has said that the legal sites are too inconvenient. Her exact words are: Not when it's inconvenient, that's for sure. Those "legal" sites are such a pain!

Even though she is an artist herself, she does go on the file sharing services.