Sonic Boom: Napster, P2P and the Battle for the Future of Music - John Alderman

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alive by touring,” said Silberman. “When Jerry died, the touring income went from enough to make them one of the top-grossing bands in America, to very little, because the Phil and Friends shows and the other shows turned out not to be as much of a draw. They laid everybody off.” At the beginning of 2001, there were fewer than a dozen people in the Dead office, down from sixty or so.

      Another legacy that the Grateful Dead community contributed to the online world was their lyricist, John Perry Barlow. Barlow, a former Wyoming rancher and sometime mentor of John F. Kennedy, Jr., was one of the more outspoken figures on the media and lecture circuit that developed around the Internet early in the ’90s. In 1990 Barlow cofounded a nonprofit Internet advocacy group called the Electronic Frontier Foundation to combat the enacting of what he considered unfair and uninformed laws to regulate the Internet. Although Barlow’s self-promotion and mildly affected cowboy/hippie/ladies’ man persona earned him some rolled eyes wherever he spoke, audiences soon found out that there was a lot going on behind the swagger and the scarf. In speeches and essays, Barlow would articulate clever metaphors, such as the use of the word “frontier” to illustrate the online experience, combining terms from science fiction with the concerns of American revolutionaries to profoundly shape the expectations of growing legions of Internet users. He borrowed author William Gibson’s term “cyberspace” and applied it directly to current Internet activity, setting Net experience apart as a separate place, which he would sometimes describe to the uninitiated as like “the place you are when you’re on the telephone.”

      An essay of Barlow’s, “The Economy of Ideas,” was widely circulated and eventually published in Wired in early 1994. In it, Barlow voiced a response to growing concerns about “intellectual property.” These concerns set the tone for many who read the essay, and examined today, they are impressively accurate.

      If our property can be infinitely reproduced and instantaneously distributed all over the planet without cost, without our knowledge, without its even leaving our possession, how can we protect it? How are we going to get paid for the work we do with our minds? And, if we can’t get paid, what will assure the continued creation and distribution of such work?

      Since we don’t have a solution to what is a profoundly new kind of challenge, and are apparently unable to delay the galloping digitization of everything not obstinately physical, we are sailing into the future on a sinking ship.

      This vessel, the accumulated canon of copyright and patent law, was developed to convey forms and methods of expression entirely different from the vaporous cargo it is now being asked to carry. It is leaking as much from within as without.

      Legal efforts to keep the old boat floating are taking three forms: a frenzy of deck chair rearrangement, stern warnings to the passengers that if she goes down, they will face harsh criminal penalties, and serene, glassy-eyed denial.

      Intellectual property law cannot be patched, retrofitted, or expanded to contain the gasses of digitized expression any more than real estate law might be revised to cover the allocation of broadcasting spectrum. (Which, in fact, rather resembles what is being attempted here.) We will need to develop an entirely new set of methods as befits this entirely new set of circumstances.

      Barlow also asserted that “The greatest constraint on future liberties may come not from government but from corporate legal departments laboring to protect by force what can no longer be protected by practical efficiency or general social consent.”

      John Barlow’s sentiments ring all too true today.

       Chapter 2 NEW WORLD ORDER

      The record industry is typically divided into the major labels and the independents. The former are bastions of wealth and prestige that have the capital to dominate the markets, from the airwaves to the chain stores, and control the networks of physical distribution. Smaller labels, while not enjoying those advantages, can be more focused and nimble, building on customer loyalty and brand recognition. Because they operate on a different scale, independents are free to take chances on artists and records that might never sell 200,000 units, the number needed for a major-label release to be considered successful. Independent labels range from fairly established players such as Epitaph, which often sells millions of copies of individual records from punk bands and free-spirited artists like Tom Waits, to some kid spending all his money to release his inspirations on the world from his basement. The “majors”—also commonly referred to as the “big five”—are Sony Music, Universal, EMI, Warner Brothers, and BMG (Bertelsmann Music Group). Together they account for more than $14 billion in yearly revenue in the U.S. market alone. The business-wide trend of corporate mergers is in full effect with these companies. The big five increasingly own many other smaller labels, some of which were once very powerful in their own right, and many of which retain a degree of autonomy. Geffen, Atlantic, and Virgin records, for instance, have been brought under the greater umbrellas of Universal, Warner, and EMI, respectively. The commonly used “indie label” moniker is a little tricky: while many independent labels are shoestring operations run out of someone’s basement, often hooked into a larger distributor, others, formerly of the basement type, have been bought out and absorbed by majors, or have made some kind of distribution deal with one of them, and are thus not quite so independent.

      As the record companies have become integrated within the folds of the multinational corporations that own them, in most cases business as usual has supplanted the more unsavory aura of organized crime that was earlier associated with the industry and that Fredric Dannen documented memorably in the book Hit Men (1991). The affectation has remained, and some, like Ice-T, insist that the business tactics haven’t changed that much. “Independent promoters” who function as out-sourced bribegivers to get a song played on the radio are still used, for instance. But mostly, the old-school shakedown has been replaced with “Roman legions” of lawyers (such as those that Seagram chief Edward Bronfman Jr. threatened to unleash against the foes of copyright) and very well paid Washington lobbyists, working hard to shape laws that suit the powerful entertainment industry.

      Among the majors there are strongly perceived mutual interests in many areas. The Recording Industry Association of America, or RIAA, is the trade association for the major (and many independent) labels’ activities in the United States. Its main activities are the monitoring of sales to award “gold” and “platinum” record status; keeping an eye out for music bootleggers and encouraging the police to enforce laws against them; and lobbying the government to enact laws that are favorable to the industry.

      The relationship of other rights bodies within the industry are relatively complex and are a fossil record that points to the past century of industry history, which was fraught with litigation and power grabs. Broadcast Music Incorporated (BMI), the American Society of Composers, Authors and Publishers (ASCAP), and SESAC (which was once the Society of European Stage Authors and Composers, but is now simply the acronym) all license music performances, such as playing a song over the radio or in a restaurant. The royalties from these performances go to the songwriters, who are not necessarily the band playing the tune. The Harry Fox Agency, a division of the National Music Publishers’ Association, oversees publishing rights to the music itself, as opposed to performances of that music. These are known as “mechanical rights.” That the lengthily negotiated pacts among artists, publishers, and labels is so hard for all parties to navigate has meant that the options presented by the fast and furious world of the Net have been met with near paralysis.

      From an early stage, there were people at the labels who experimented with computers. If their vision of how technology and music might meet was sometimes less inspiring than those of outsiders, it was, at least, rooted in experience. One such executive was Ted Cohen, a music biz player who became infected with the excitement of new technology.

      Cohen started out at the Boston office of Warner Brothers in 1972, and he worked his way up through local promotion to artist development. By 1977 he was asked to move to Burbank to work on career development with artists such as Van Halen, Fleetwood Mac, Talking Heads, George Benson, Sex Pistols, and the Ramones.

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