The Kazaa KO

The outcome of the Kazaa case in Australia is a win for the music industry's slash and burn approach to peer-to-peer file sharing networks. On the face of it, their objections seem reasonable. Content creators should be able to protect their intellectual property, otherwise it would be harder than it currently is to earn a living from singing, dancing or pretending to be able to do either. But there is more to it than that. What makes the record labels nervous is not copyright infringement per se, but any form of distribution that is not entirely within their control.

Distributing copyrighted material by sharing it with other users is actually not illegal. You only break the law when you distribute without permission. So, you ask - just who would be crazy enough to actually grant their permission?

Arguably, the only thing stopping most artists today walking from the record labels and distributing all their music, is that it takes a lot of retail distribution power to get albums on shelves, and marketing money to get people to pay attention. So even if you were confident you could bypass normal retail channels and sell direct from your website, you still need serious money or major media partnerships to effectively secure online distribution.

However, if enough of the world's music listeners were hooked up to a comprehensive P2P service, a popular artist could potentially turn music industry economics on their head - releasing music for free into the network and making money on concerts, merchandise and marketing endorsements.

And that would not be good news for the music moguls of the world.

So, with Kazaa out of the way, you can bet that eDonkey and Bit Torrent are next in the line of fire.

Luckily the Kazaa guys have another brillant idea up their sleeves - Skype. Which is not so lucky for the world's Telcos, who now probably wish they had their own grounds for a lawsuit or two to stop their industry being invaded.

Comments

[David Hunt]

And yet... the court ruling doesn't prevent any artists from releasing their music for free via Kazaa (or any/all other networks) and "making money on concerts, merchandise and marketing endorsements." They could do this today.

The fact that artists haven't chosen to do so suggests that this "business model" is a fantasy invented by hi-tech writers (not just you, Mike-- Graeme Philipson in the Fairfax papers is always yammering on in this vein).

Free P2P distribution will always be an interesting tool for independent artists to get noticed, and for established artists to release *some* material as promotion for the for-pay product. In that, it's the same as every free distribution channel in history, from Sam Phillips giving away promotional singles to AC/DC playing for free from the back of a truck.

But I don't see it ever legitimately replacing paid releases, whether in physical CD form or digital downloads.

I also think we need to be more sophisticated in exploring the question of 'what record labels actually do to justify their position as middlemen'. It's too easy to dismiss them as just parasites who will inevitably be washed away by the tide of history.

Your argument about artists walking away from record labels is basically saying that 'the only thing stopping most artists today from distributing direct is that it would take time, effort and capital investment'-- time, effort and capital that (I would argue) are better deployed in making music, raising their families and buying better dope than in the business of selling music (which is, let's face it, very different from the business of making it). David Riccardo lives.

You could argue (using almost identical logic) that musicians should 'cut out the middleman' and make their own instruments. Some do. Most don't, due to a shortage of time, specialized skill and equipment, and-- frankly-- interest. They would rather play music than build guitars.

It's a difficult question-- what's the appropriate role of publishers and labels in the new world-- and a question the labels aren't doing a good job of answering. I suspect that the 'right' answer lies somewhere between the labels' kneejerk response ("Same as it ever was") and the P2P cheerleaders' answer ("Broken bottles under children's feet").

Agree about Skype-- it's a brilliant idea and if they ever get it to work it'll be a great tool [5 seconds of staticy echo follows]: great tool.. great tooll.. greatt toolll.. skkyrrkxxykrxyk

David

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