[By Robert Andrews] This conference on the digital music business got off to a bang here in Cannes this morning when the opening-session dis…

[By Robert Andrews] This conference on the digital music business got off to a bang here in Cannes this morning when the opening-session discussion broke into a tense and sometimes bitchy disagreement about DRM between representatives from music, movie and electronics industry associations. MPAA executive vice president Fritz Attaway and RIAA chairman Mitch Bainwol immediately set their stall against Consumer Electronics Association president Gary Shapiro. A sample:

Attaway: “Technology should not be expected to respect existing business models, but the people who use technology have a responsibility to respect the rights of intellectual property owners. When one consumes a movie by viewing it, there is some obligation to compensate those involved in making it. It does cost a lot of money to make this product — there is no business model where one invests several million dollars in making a movie and then gives it away for free; that just doesn’t work for movies and it doesn’t work for music, too. Restrictions should not be put on technology, but they should be put on the people who use technology.”

Bainwol: “Technology is not a license to steal and it doesn’t sanitize theft. Technology needs to respect the law. It can challenge business practises [but] there is not an excuse to bypass the rule of law when you build a business model based on theft.”

Shapiro: “Consumers have certain rights to move content around their home. DRM is clearly desired by components of the motion picture and music industries, but consumers have started to revolt against it and you’re beginning to hear it. It’s confusing and resented by consumers. Business models are emerging and major record labels are starting to pick up on this. [If you drop DRM], you’re taking a risk that unethical consumers will spread the content around the world — but that’s a risk you’re going to have to take. … When the law penalizes so much, something is wrong and has to be changed. When consumers are afraid to do something for a school project because they’ve listened to the RIAA disinformation campaign, something is wrong. Consumers are rejecting DRM [because it's confusing]. Independents and some major labels soon are going to be saying ‘no DRM on our products.’

Responding, Attaway said: “We are investing a lot of time and energy with Gary’s members to improve DRM. It needs to be better. We are all for technological innovations that make DRM more acceptable, allowing consumers to do more with their content but to also protect creators.”

The gloves quickly came off between Shapiro, whose association runs a campaign to brief consumers on what he calls the “facts” about copyright, and the two industry reps. Bainwol said the CEA president, because of his pleas to abandon restrictions and liberalize fair use policies, sometimes resembled “a fringe, ideological leader”: “We are in a very, very significant transition,” Bainwol said. “Technology is the basis of our future. We have to be able to monetise product and, every time we try, you want to make it available for free so people can buy devices. Gary stretches the concept of fair use to the point where the notion of ‘fair’ has been eliminated. You have to protect the market value. [Gary] wants to morph fair use into a concept that justifies any consumer behavior to the point where you eliminate the value of property. Kids grow up not understanding that music and movies are intellectual property. You teach disrespect for intellectual property. Gary takes a concept, morphs it, makes us look like we’re evil.”

Shapiro countered: “I don’t make you look evil – your lawsuits against old people around the country make you look evil. You’re very good at paraphrasing things I never said.”

Attaway: “The CEA has initiated this campaign against DRM which is against a lot of your your own members, who are making great strides in DRM to provide consumers with choices. You’re the one that is trying to stifle innovative technology and we’re trying to use it. Gary is trying to enact laws that limit the use of technology to create new business models.

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  1. this battle will go on for years.
    it's WRONG to blame record companies for suing people who rip off their copyrights.
    The labels have NO OTHER option.

  2. Why won't the manufacturers who create these devices offer to give them away for free? Isn't that similar to what they're asking of the recording industry? You can't suck and blow at the same time now, can you?

    Having said that, this Mexican stand-off will remain as such until both sides are able to find a comfortable compromise to work in concert with as opposed to against each other.

    The consumers are merely caught in the middle of all of this psychobabble rap. Bottom line, theft is theft.

  3. "The labels have NO OTHER option."

    I guess I'll continue to buy my music from emusic.com then, and wait until the major labels either collapse or realize that there are lots of people out there that is willing to pay for non-DRMed content.

    "Bottom line, theft is theft."

    The point the majors are missing is that heavy DRM is adding to the problem. If customers can't use the media they buy in ways they consider to be fair (f.ex. region lock on DVDs, iTunes 5 device max, not to mention all the craziness in HD-DVD, Blu-Ray, CableCard and Windows Vista) they will opt for non-DRM'ed media. And the main source for that today is unfortunately P2P.

    I want to see creators compensated for their work, but putting heavy limitations on users and consumer electronics manufacturers is not the right path.

  4. Russell McOrmond Sunday, January 21, 2007

    Before people go on with the "theft is theft" nonsense, please realize that DRM by definition infringes the property rights of the owners of technology.


    Moved from science fiction to the actual science of how "DRM" works, it is not clear who Bainwol was referring to when he said that, "there is not an excuse to bypass the rule of law when you build a business model based on theft". This sounds to me like those new business models based on DRM that Attaway talks about later.

    DRM doesn't (and is incapable of) stopping copyright infringement. It can only circumvent the rights of citizens, and allow dishonest businesses to then extract money by "selling back" those rights to people.

  5. Information wants to be free!!!

    In the end it's all just a bunch of one's and zero's!!!

    This is true democracy. Must I remind everyone that the the bussiness model that both sides are trying to adhere to is only 50 years old. Now for the first time this bussiness model is very outdated. As far as I'm concerned capitalism in this form is outdated as well. But, a solution for both sides lies in advertising generated revenue and in the future both sides will be forced to realize this. I think both sides are right and both sides are wrong. I just hope that the corporate elite stop from infringing on peoples rights inorder to capitalize on them. yeah right. thankx for reading my comment.

  6. When technology supersedes copyright, copyright changes. End of story. We shouldn't even be having this argument.

    The history of copyright is this:

    1. New technology is invented
    2. Existing content industry blows it off and calls all of its users dirty pirates
    3. Technology out-paces current content industry and *becomes* the current industry
    4. Most of those who blew it off spend the rest of their lives working in burger joints because they were too blindly stupid and ignorant to realize that the technology they tried to suppress was actually their future.

    Wash, rinse, repeat.


  7. The unique and wonderful thing about digital content is that it can be moved around easily to different devices and to different formats. DRM seeks to predictably inhibit this exact freedom and thats is why consumers hate it.

    DRM free products like the CD and MP3 are what started this revolution. Any 8 year old can crack the DRM on a dvd. Thus now DVD's are essentially DRM Free at this point.

    That being said its obvious that almost all digital content purchased today (well over 90%) is DRM Free and yet the content industries are THRIVING.

    I hate the MPAA and RIAA as much if not more than the next guy for their lawsuits and their obvious lack of humanity, but what really gets to me is their ability to get anyone to believe that they can't survive in a world without DRM when they are doing it right now.

    getting off my soapbox now… I have to go copy my newest cd to my ipod in MP3 format now :)

  8. The unique and wonderful thing about digital content is that it can be moved around easily to different devices and to different formats. DRM seeks to predictably inhibit this exact freedom and thats is why consumers hate it.


    you're going to have to bend way over backwards to make that make logical sense. buying it and transfering it removes money from the transaction from the entertainment industry and sends those dollars back to CEA companies.

  9. (…there is not an excuse to bypass the rule of law when you build a business model based on theft.”)

    Oh please, that has been the music industry's main MO for decades, just ask the artists, like Prince, or Dan Fogerty, or countless others. Artists have been being ripped off for quite some time by that crowd.

    In the future, there will be no DRM, because artists will bring their own product to market themselves, without major corporations as the middlemen. The majors are pushing DRM because they need some justification for staying in the loop, as the "protectors" of artists' property rights. What a very sick joke.

  10. If, in fact, the RIAA business model was not about theft, the lawsuits that have been subjected upon the American public would be for a realistic amount. There is documented evidence of the RIAA suing people for tens of thousands of dollars, people who are accused of "stealing" tens of songs. (Which undoubtedly play tens of times a day on radio stations across the U.S.) An individual song file, based on prices found all over the internet, is worth maybe a couple of dollars. In a realistic and fair proceeding, the plaintiff seeks fair reparation for losses incurred. The RIAA has not in fact suffered tens of thousands of dollars of loss for each file that an individual may have downloaded from an internet site or from a peer. (Again, this "intellectual property" is played over the radio and on television and on many corporate web sites all day long)

    In a civil proceeding, the rights of an individual who cannot afford a lawyer are nonexistent. There is no provision for the protection of the "attorney challenged" in a lawsuit. This is a violation of the spirit of the Constitution of the United States of America.
    If in fact the people targeted in the lawsuits have committed theft, they should be prosecuted in a criminal proceeding, where their rights are protected by federal law and the Constitution. Innocent until proven guilty is a basic tenet of the American way of life. It is patently impossible to prove that you have never downloaded a file from the internet. The very nature of the internet makes it impossible to prove that you never stole any intellectual property. (The whole tube thing notwithstanding) The very fact that the RIAA does not solely implement criminal prosecution in its campaign against these so-called thieves, but instead levies five digit "fines" for the accused theft of several whole dollars worth of merchandise is in effect a criminal act. It is extortion at a base level. If you own a computer, have paid for internet access, and are on their list, you must pay them their money, or pay much much more in legal fees. You can pay this extortionate price (to avoid further harassment, as in dealings with local "protection" rackets put forth by the mafia and the yakuza of legend) or you can sell your house and take potentially weeks off of work to go to court to defend your innocence. The RIAA is a dinosaur, and I feel that everyone who has been named in a lawsuit by the RIAA should join a class action suit to have the attorneys and company officers prosecuted in civil court for extortion and gross violation of civil rights.

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