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FEBRUARY 13, 2003 COMMENTARY By Jane Black Big Music's Broken Record [Page 2 of 2]
Yahoo and Amazon refuse to let users hawk CD-Rs at their auction sites. Yahoo says it's part of an effort to work with the RIAA to prevent piracy. eBay, the Web's largest auctioneer, does allow the sale of CD-Rs if sellers expressly state they own the copyright to the material. HEAVY LEVY. Sound draconian? It is. Recordable CDs can contain music from an indie band, open-source software, or uncopyrighted video clips, among many other things. "I was being punished because of my chosen medium, because I didn't want to shell out the money to press 1,000 copies of a CD before I knew that 20 would sell," Ziemann says. Things could get worse. The Canadian Copyright Board is weighing a plan to raise a levy on every CD-R sold from 21 cents to 59 cents, as well as on the hard drives found in MP3 players, where, theoretically anyway, stolen music is stored. That's a huge tax, especially when you consider that blank CDs usually sell for less than $1. There's more. The price of Apple's (AAPL ) popular iPod MP3 player would increase by 33%, from $300 to $400, if the levy is imposed. A 60-gigabyte car stereo from MP3 maker Rio would face a $1,260 tax. Twenty five countries, including most of the European Union, have introduced similar plans. The U.S. already imposes levies on digital media, including digital audio tapes and recordable CDs designed especially for audio. FAULTY ASSUMPTIONS. Internet piracy is undoubtedly affecting the music business. According to Nielsen Net Ratings, 10% of Internet users have downloaded KaZaA's file-trading software, making it the sixth most-popular media application, after Windows Media Player, which comes as part of the ubiquitous Windows operating system, and various instant messenger programs. And KaZaA users are doing more than just trading chili recipes. Still, it seems irresponsible for music-industry officials to present these sales statistics as proof that piracy is overwhelmingly responsible for the industry's woes while conveniently ignoring the economic and technological context that puts those numbers in perspective. "The policy decisions being made today are based on the assumption that [file trading] is killing the music business. But no one is looking deeply enough at the facts," says Jim Burger, an attorney who represents the computer industry at Washington (D.C.) law firm Dow, Lohnes & Albertson. A realistic assessment of the music business' troubles would help inform policymakers as they fashion proposals aimed at eliminating the illegal reproduction of copyrighted music. No one is arguing that piracy should be allowed. But it's reasonable to expect that laws and rules designed to curb the practice be based on credible and truthful representations of the impact file-sharing is having on the music industry.
 Black covers technology for BusinessWeek Online in New York Edited by Beth Belton Get BusinessWeek directly on your desktop with our RSS feeds.  Add BusinessWeek news to your Web site with our headline feed. Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video. To subscribe online to BusinessWeek magazine, please click here. Learn more, go to the BusinessWeekOnline home page  | | FEBRUARY |
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