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Future of Music Newsletter #36 |October 14, 2004

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10.14.2004

newsletter archives

  1. Policy Summit 2005 dates announced!
  2. FMC @ CMJ 2004
  3. INDUCE Act fizzles out…
  4. …but will the Supreme Court pick up the torch?
  5. Indecency fines also flounder
  6. File a comment at the FCC on localism in radio
  7. A digital primer on SoundExchange
  8. In the newsstream
  9. Results from FMC’s membership survey

---------------------------------------------------------------
1. Save the Date for FMC Policy Summit 2005
---------------------------------------------------------------

Mark your calendars!  FMC is pleased to announce that our 5th annual Policy Summit will be held Sunday, April 10  – Tuesday, April 12, 2005 at George Washington University’s Lisner Auditorium in Washington, DC.

We're really excited about these dates because they fit nicely in between South by Southwest in March, Jazzfest and Coachella in late April, and Free Press’ Media Reform conference in May.  Plus, it will be the end of the cherry blossom season in DC so the nation’s capitol should be lovely.

In order to make the event as timely and relevant as possible, we won’t start organizing panels and inviting speakers until mid-December, but stay tuned to the newsletter for developments.  You can also visit the Summit’s homepage at http://www.futureofmusic.org/events/summit05/ for details about scholarships and sponsorship opportunities.  And we hope to see you all in DC in the spring!

---------------------------------------------------------------
2. FMC @ CMJ 2004
---------------------------------------------------------------

It’s either a brilliant stroke of luck or the worst scheduling mishap in the world that CMJ has put all of the FMC crew together on one panel this year. At 3:30 PM on Thursday, October 14 join FMC's Jenny Toomey, Michael Bracy, Kristin Thomson, Brian Zisk and entertainment attorney Whitney Broussard for an engaging and wide-ranging discussion on the current policies and the business models that are having a significant impact on the livelihoods of musicians.

No group hugs and no high fives – we promise – but we are going to keep this exciting by asking members of the audience to come up and spin the Music/Technology Policy Wheel of Fortune!

On what topics will lady luck land? Will it be on the INDUCE Act, or Health Insurance for Musicians, or the Anti-Bootlegging Law? FMC will be at the mercy of the wheel for the whole panel.

Thursday’s program at CMJ also includes keynotes by Al Franken and Brian Wilson, so spend the whole day at the Westin Hotel!For more details and directions visit CMJ’s webpage.

-------------------------------------------------
3. The INDUCE Act fizzles out…
-------------------------------------------------

After negotiations on the bill’s language fell apart late last week, the INDUCE Act fizzled out in committee.  You may remember from earlier newsletters that the INDUCE Act was a bill introduced by Senator Orrin Hatch (R-UT) that would have made technology companies that “induce” the public to illegally share movies or music legally liable for these violations, a prohibition that would have effectively banned P2P filesharing networks, but also put legitimate hardware and software – such as iPods – at risk.

In early August, FMC sent a letter to the Senate Judiciary Committee that expressed our concerns about the original draft of the INDUCE Act.  Briefly they were:

  • Creators are stakeholders and should be at the table during these policy deliberations.
  • INDUCE assumes that all copyright owners do not want their works to be shared on a P2P network when preliminary results from the FMC/Pew Internet survey suggest that many artists believe P2P file-sharing has helped their careers.
  • INDUCE does not promote market-based solutions.

Read FMC’s letter to the Senate Judiciary Committee here

In late August, the Senate Judiciary Committee ordered the US Copyright Office to draft a proposal written specifically enough to ensnare the “bad actors” but not harm legitimate businesses, software and hardware.  The Copyright Office was diligent in its efforts to include many stakeholders in this process, and FMC was one of the many groups invited to review the draft and submit comments.  

In our comments to the Copyright Office, FMC’s Walter McDonough pointed out that any representations that "all" musicians are united in support of INDUCE (or any similar legislation) was simply wrong and that some artists have actually benefited from the exposure that P2P filesharing can give to a musician.

An excerpt from Walter McDonough’s reply: ”Because the continued consolidation of radio in the United States and the decline of traditional record retail have deprived many independent recording artists of access to the media and significant marketing opportunities, P2P, in some instances, has been their only available method of communicating with the public.  Certainly, we are discussing a universe of copyright owners who have made the decision to share their intellectual property without reservation.  Although the actions of unscrupulous business entities that sanction copyright infringement are certainly deplorable, a blanket ban on P2P will deprive many copyright owners, particularly independent artists, of exercising their exclusive rights under section 106 to increase public awareness of their copyrights by using this relatively new form of media distribution.  This is the unintended consequence that we hope that the Copyright Office and the Congress consider in their deliberations - - - independent musicians who choose to use P2P should not have their only access to a mass market denied to them.”

On September 10, the Copyright Office submitted recommended language to amend Senator Hatch’s original bill to the Senate Judiciary Committee.  Despite the Copyright’s Office’s attempt to craft something specific, technology companies criticized the proposed language, claiming it suffered from the same defects as the original.

Copyright office pitches anti-P2P bill
The U.S. Copyright Office has drafted a new version of the Induce Act that it believes will ban networks like Kazaa and Morpheus while not putting hardware such as portable hard drives and MP3 players on the wrong side of the law.
By Declan McCullagh, CNET, September 2, 2004

New Induce Act Proposal Is a Bad Idea
The proposed language targets companies who make "public dissemination" technologies, where those companies make money from, or attract users with, copyright infringement.
By Fred von Lohmann, EFF, September 11, 2004
http://www.eff.org/news/archives/2004_09.php#001899

Copyright Proposal Induces Worry
For the first time ever, Rodger wrote in an e-mail, it would make it possible for someone who has not infringed to be liable for others' infringement.
By Katie Dean, Wired.com, September 11, 2004

Senator Hatch demanded that representatives from the technology and entertainment industries meet to negotiate a compromise.  Despite what was reported as hours of closed-door meetings, the technology companies and recording industry reps could not come to a workable agreement, especially on the tight time frame of this congressional session (which formally ended Friday, October 8). This led the bill to stall in committee.

Senate Talks Fail on File-Sharing Software
Entertainment groups and consumer organizations were unable Thursday to reach a compromise over a Senate proposal aimed at manufacturers of file-sharing software commonly used to steal electronic copies of music, movies and computer programs.
By Ted Bridis, Associated Press, October 7, 2004

Senate Shelves Induce Review 
The Senate Judiciary Committee has postponed a final review of the Induce Act after negotiations among the principal parties involved in crafting the bill collapsed.
By Katie Dean, Wired, October 7, 2004

While some in the music and recording industry feel like the INDUCE Act is a reasonable way for copyright owners to legally go after the P2P services that facilitate filetrading, the FMC continues to have serious reservations about the bill.  As such, we are glad that the bill has not moved ahead.  This does not mean that we do not value copyrights or think it’s okay for people to steal music – but rather we think that the bill would not have provided a workable solution.  It could have chilled innovation, put legitimate hardware and software businesses at risk, and it would have given the record companies the legal tools to shut down file sharing systems that some musicians and artists actually embrace, not to mention the fact that P2P services are capable of non-infringing uses. 

Trying to legislate P2P filesharing is akin to a game of whack-a-mole and the very bad actors will always come up with a way to shield themselves from being subject to the enforcement of US Copyright law, so there’s a question of whether any piece of legislation could accomplish what Senator Hatch envisioned. FMC would like to see the market sort out the balance between copyrights and emerging technologies before any legislation that could hinder one or the other is enacted.

---------------------------------------------------------------
4. …but will the Supreme Court pick up the torch?
---------------------------------------------------------------

In a remarkable coincidence, the derailment of the INDUCE Act in Congress came the same day as an announcement that the movie studios and the RIAA had petitioned the Supreme Court to hear the Grokster case.

On August 19, 2004, the 9th Circuit Court of Appeals issued its opinion in MGM v. Grokster, affirming the District Court finding that Grokster’s and Streamcast’s peer to peer file sharing networks do not contributorily or vicariously infringe the copyrights of the holders of music and movie copyrights.

This decision upheld the Sony Betamax decision of 1984, which ruled that VCRs were legal because they had beneficial uses besides infringing copyrights by copying television content.  Basically the 9th Circuit found that peer-to-peer networks have the same legal standing as the manufacturers of VCRs – that the creators of P2P networks can’t be sued for the actions of the networks users, even if the actions are illegal.

FMC operations manager Wendy Harman has written an excellent background piece on the Grokster 9th Circuit decision.  Read it here: http://www.futureofmusic.org/articles/grokster.cfm

Clearly the MPAA and RIAA were not happy with the 9th circuit decision.  So on Friday, October 8, the MPAA and the RIAA filed a petition at the Supreme Court, asking that the high court take this case on appeal.  The petition charged that lower courts erred in letting peer-to-peer networks profit from copyright infringement. It also suggested that the RIAA’s campaign of lawsuits against P2P filesharers has proven to be ineffective in stopping the damage that illegal filesharing has inflicted on these content industries.

"Resolution of the questions presented here will largely determine the value -- indeed, the very significance -- of copyright in the digital era," according to the industry's petition. "The infringement Grokster and StreamCast foster is inflicting catastrophic, multibillion-dollar harm on petitions that cannot be redressed through lawsuits against the millions of direct infringers using those services."

Now the question on the table is whether the Supreme Court will agree to hear this case.  The court only agrees to hear a handful of the thousands of petitions it receives in a year.  However, this case does seem to have the elements that would attract the high court’s attention, as articulated by law professor Tim Wu a few weeks ago. http://www.lessig.org/blog/archives/002103.shtml

Some news clips about the Grokster case, both the Supreme Court petition and the 9th circuit decision:

Hollywood takes P2P case to Supreme Court
Hollywood studios and record companies on Friday asked the United States Supreme Court to overturn a controversial series of recent court decisions that have kept file-swapping software legal.
By John Borland, CNET, October 8, 2004

Studios, labels take file-sharing fight to Supreme Court
By Jesse Hiestand, Hollywood Reporter, October 8, 2004

Judges rule file-sharing software legal
The ruling means that companies that write and distribute peer-to-peer software can't be shut down because of the actions of their customers.
By John Borland, CNET, August 19, 2004

P2P Services in the Clear
"History has shown that time and market forces often provide equilibrium in balancing interests, whether the new technology be a player piano, a copier, a tape recorder, a video recorder, a personal computer, a karaoke machine, or an MP3 player. Thus, it is prudent for courts to exercise caution before restructuring liability theories for the purpose of addressing specific market abuses, despite their apparent present magnitude."
By Katie Dean, Wired, August 19, 2004

---------------------------------------------------------------
5. Indecency fines also flounder
---------------------------------------------------------------

Senator Brownback’s attempt to hike broadcast indecency fines on performers has been removed from a Department of Defense authorization bill.  The “Broadcast Decency Enforcement Act of 2004” (S 2056) proposed raising the maximum indecency fine from $32,000 to $500,000 per incident and, for the first time, make individual performers, announcers and broadcast journalists liable for indecent broadcasts – even for recorded material.

This bill was drafted following the tumult of profanities and “wardrobe malfunctions” that happened on national TV and radio in the past year.  The bill had widespread support in both the House and Senate, as legislators responded to calls from parents and concerned citizens about the escalating amount of lewd, sexual, or profane material that was seeping into network TV and radio.

The bill, however, proposed to fine not only the station owner but also the announcer/performer. Given the fact that the FCC has never fined an individual performer or announcer, this legislation codified a striking shift away from the FCC’s long-standing policy that holds that the broadcast licensee is responsible for programming decisions.

Props to AFTRA and the Recording Artists’ Coalition for working hard against passage of the bill in this form, but also to Senator Byron Dorgan who refused to support the bill unless provisions on media-ownership limits were also included in the bill.  When Dorgan refused to budge, all the bills related to media ownership – including indecency – were scrubbed from the bill. 

We expect this is not the last we will hear about broadcast indecency as it does enjoy bi-partisan support, so we will keep you posted on other developments.

Indecency Legislation Dropped
By Frank Ahrens, Washington Post, October 8, 2004

Move to Raise Indecency Fines Fails
Associated Press, October 11, 2004

Indecency fines stripped from DOD operations bill
By Brooks Boliek, Hollywood Reporter, October 8, 2004

---------------------------------------------------------------
6. File a comment on localism in radio
---------------------------------------------------------------

On July 1, 2004, the FCC issued a “Notice of Inquiry” (NOI) on localism in broadcasting.  This NOI is part of the FCC’s broader Localism Task Force – an initiative that grew out of the contentious media ownership proceedings of 2003 during which millions of citizens filed comments at the FCC on the state of their local media. Go here for details: http://www.fcc.gov/localism/

Since issuing the NOI, the FCC has been collecting comments from stakeholders and members of the public on localism in radio and television.  Considering how important access to radio is for musicians, it’s essential that musicians, performers and citizens weigh on this topic by submitting a written comment to the FCC before November 1.

FMC and AFTRA have built a web tool that will help folks submit comments that will assist the FCC in creating regulatory policies that match musicians' and citizens' expectations. 

The web form breaks down the FCC’s NOI into twelve subcategories and provides a bullet list of the topics and questions that are on the table. Next to each bullet list we give you text boxes to type your comments in. When you get to the end of the form, hit submit and you'll see your typed replies combined into one comment.  After you've reviewed it, we will help you file electronically it as a public comment at the FCC.

Right now we’re making sure that it works technically, but the form should be up and running by early next week. We hope that many musicians and citizens will file comments in this proceeding, so stay tuned for a specific email about this campaign in a few days.

---------------------------------------------------------------
8. A digital primer on SoundExchange
---------------------------------------------------------------

SoundExchange is the agency that collects royalties for performers and copyright owners for digital performances – those on webcasting stations, satellite radio (XM and Sirius) and cable subscription services.

Since SoundExchange has only been around a few years, many musicians and performers don’t know about it, let alone what it does.  We’d like to change that.  In a world where digital performances are quickly supplanting record sales, it’s vitally important that musicians of all levels understand what revenue streams are out there and how to tap into them.

Here’s an article/interview that explains SoundExchange’s role, and how it benefits performers and labels. Read on! http://www.futureofmusic.org/articles/soundexchange.cfm

---------------------------------------------------------------
8. In the Newsstream
---------------------------------------------------------------

And if that isn’t enough news, how about these items?

High Court Won't Hear Music Sharing Case
The Supreme Court sidestepped a dispute over whether Internet providers can be forced to identify subscribers illegally swapping music and movies online.
Associated Press, October 12, 2004

US Judge: Anti-Bootlegging Law Is Unconstitutional
A federal judge dismissed charges against a New York record store owner who had been selling unauthorized recordings of concerts, saying a law against boot-legging was unconstitutional.
Reuters, September 24, 2004

6th Circuit says clear all samples
A Federal Appeals court rules that rap artists should pay for every musical sample included in their work – even minor, unrecognizable snippets of music.
By John Gerome, USA Today, September 8, 2004

Microsoft launches its online music store
Microsoft insists its service is different from Apple’s iTunes.  Among other things, the company claims its service will have a different look and feel, and says a main selling point is that is that songs can be played on more than 70 handheld devices that support its Windows Media format.
By Allison Linn, Associate Press, September 2, 2004

JibJab is Free for You and Me
Woody Guthrie’s estate took offense to JibJab’s satirical cartoon rendition of “This Land is Your Land,” but couldn’t stop the small company from using it because the song belongs to the public domain.
By Katie Dean, Wired, August 14, 2004

---------------------------------------------------------------
9. FMC Membership Survey Results
---------------------------------------------------------------

Thanks to everyone who responded to our membership survey in August, which asked FMC newsletter subscribers who they are, what they like about FMC, and what issues they find important. Here’s a snapshot of the data:

DEMOGRAPHICS of SUBSCRIBERS
Role: 40% musicians, 17% music fans, 6% advocates, 5% attorneys
Music genres represented: rock, songwriter, indie, experimental, composer, jazz, avant-garde
Age: 25-34 = 42%, 35-44 = 27%
Gender: 70% male, 30% female
Race: 82% white, 5% NA, 3% black, 3% multiracial
Income: 17% in the $25K range, 15% in the $35K range, 15% in the $90K range
Education: 41% college grads, 30% graduate, 21% some college

ISSUES
The top five important issues for the respondents were: 1. Media ownership 2. Copyright issues 3. P2P filesharing 4. Digital music stores 5. Major label practices

Favorite FMC campaigns and projects were: 1. the Policy Summits 2. the newsletter 3. the radio study “Radio Deregulation: Has it Served Citizens and Musicians?”  4. our work on media consolidation and 5. the major label contract critique

Want to see more results, including the very long list of “other issues” that FMC should consider working on?  Go here: http://www.futureofmusic.org/about/subscribersurveyresults.cfm

And thanks again to everyone who participated.  It was very helpful for us to gather feedback about our work and understand the contributions that we can make in the music/technology space.

-------------------------------------------------------
10. How are we doing?
-------------------------------------------------------

The “what we’re doing” section will return next month.

You can always send an email to suggestions@futureofmusic.org with your comments. 

Thanks as always,

Jenny Toomey
Michael Bracy
Walter McDonough
Brian Zisk
Kristin Thomson
Peter DiCola
Wendy Harman

Donate to the Future of Music Coalition!
Secure online donations are accepted at any level at https://www.futureofmusic.org/donate.cfm


 




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Successful New Orleans Concerts Aid Big Easy Musicians
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January 15, 2008
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FMC's Latest Fact Sheets
HD Radio
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Orphan Works
Traveling with Instruments
Touring Internationally
SoundExchange
Net Neutrality
Full Power Non-Commerical Radio Licenses
Media Ownership

Ann Chaitovitz Appointed
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Concerts for New Orleans Musicians Bring Artists Together
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FMC's Jenny Toomey Appointed Program Officer for Ford Foundation
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Rock the Net: Campaign for Net Neutrality Rocks Seattle
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Future of Music Policy Summit to Tackle Critical Issues at the Intersection of Music, Law, Technology and Policy
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Summit home page
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AT&T's muting of bands points toward a pattern of silencing political speech
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Top musicians, lawyers, technologists confirmed for FMC's 7th annual Policy Summit
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FMC Statement on AT&T Silencing Pearl Jam's lyrics during Lollapalooza webcast

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Registration Opens for FMC's Annual Policy Summit
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FMC Statement on Federal Trade Commission Report on Net Neutrality
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Press Release | Testimony

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Low Power Radio Gets New Push in Congress
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FMC Announces Dates for 7th annual Policy Summit
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FMC Files Reply Comments in FCC Media Ownership Proceeding
January 16, 2007

FMC Statement on FCC Payola Settlement
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January 16, 2007

Radio Station Ownership Consolidation Shown to Harm Musicians and the Public
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December 13, 2006
Press release
Report details

Jenny Toomey Testifies at FCC Media Ownership Hearing, Nashville, TN
December 11, 2006
Read FMC's testimony
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FMC Organizes Musicians Bringing Musicians Home
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October 23, 2006
Read press release
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October 23, 2006
Executive Summary
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August 9, 2006

FMC Releases Research on Employment and Wage Effects of Radio Consolidaton
August 9, 2006

FMC on Preserving the Dynamism of the Internet
Opinion Piece on ABC News
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FMC Statement on Senate Commerce Committee Vote in Support of LPFM
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FMC Statement on FCC Media Ownership Proceeding
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May 25, 2006
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November 18, 2005

FMC Sends Letter to Senate Commerce Committee in Support of a Public Performance Right for Sound Recordings
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FMC Announces Health Insurance Navigation Tool
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5th Annual Future of Music Policy Summit Announced
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FMC Statement on MGM v Grokster and Brand X
June 27, 2005
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April 8, 2005

FMC's Michael Bracy Testifies in front of House Judiciary Committee on "Digital Music Interoperability"
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FMC Sends Letter to Senate Stating Concerns about S 193, Broadcast Decency Enforcement Act
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January 3, 2005
PDF of document