By Jared Chausow
By Katie Toth
By Elizabeth Flock
By Albert Samaha
By Anna Merlan
By Jon Campbell
By Jon Campbell
By Albert Samaha
Then again, you might want to spend your $0 nabbing an impeccable version of "My Heart Will Go On," Korn's "Ass Itch," or the countless illegally uploaded MP3 files on the Net. The stats on this underground music market are sketchy, but Cyveillance, an Internet surveillance company that tracks piracy, speculates there are over a thousand sites that contain some hundred thousand MP3 files. By way of comparison, the excellent resource MP3.com, since launching 11 months ago, has had 4 million downloads of legit (authorized) songs by both major performers like the Beastie Boys and unsigned artists. Traffic to the site is increasing by 45 percent each month. "The MP3 thing has gone crazy--it's huge," says Michael Goldberg, senior vice president and editorial director of the online music hub SonicNet.com. "The kids under 24 who grew up on computers are really into the idea of being able to download music. The record industry needs to look at that... and figure out a way to ride on it."
The recording industry has, of course, done just the opposite--and understandably so. After months of scanning the Web (with Cyveillance) and spooking pirate sites with cease and desist mail, the Recording Industry Association of America (RIAA)--which represents the major labels (90 percent of the entire music industry)--has finally snapped. Last Friday, the RIAA was granted a restraining order against Silicon Valley company Diamond Multimedia (www.diamondmm.com) to stall the release of the company's MP3 walkman, called the Rio player.
Set to ship in early November, the highly anticipated $199 Rio is exactly the kind of device that could transform MP3 trade from an online phenomenon into a mass-market craze. Smaller and slighter than a regular Walkman, the Rio player has no moving parts. It connects to your hard drive and can download up to 60 minutes of MP3 files. (The player itself comes with a CD of 200 MP3 songs, none of which had been finalized as of press time.)
"Diamond is launching this product now to take advantage of the pirate market on the Net," says RIAA president Hilary Rosen. "The music industry is working with the tech industry on long-term solutions to security issues [for music]... but Diamond is deliberately not waiting."
Both parties seem to agree about what the Rio player does, but they can't agree on how to talk about it, which makes all the difference. According to the RIAA, the Rio player is a recording device, and therefore violates the 1992 Audio Home Recording Act, which forces the makers and distributors of digital recording devices to pay a royalty to the music industry because of the risk of copyright infringement (with perfect copies via DAT or MP3).
But Diamond rep Ken Wirt argues that Rio is not a recorder but a playback device, since it's simply replaying music that has been acquired elsewhere (i.e., online). "We are only authorizing legit MP3 sources like MP3.com or [MP3 online label] Goodnoise.com," Wirt says. "We're not condoning or favoring or enabling piracy. You don't need a Rio player to [pirate music]."
"Piracy is just the cost of doing business in the digital age," says Michael Robertson, CEO of MP3.com. "The software industry went through the same thing." But consumers rejected the hassle of many security methods, and even when they worked, they weren't foolproof. "People will always do an end-run [around them]," Robertson says.
The end-run here is starting to look like a full-frontal attack, prompted by the groundswell of small-time, unsigned artists turning MP3 into their medium of choice. What 90 percent of the music business calls "piracy," the other 10 percent calls "marketing." Razorfish Studios, the multimedia entertainment group of the New York design shop Razorfish, released its first album, by Brooklyn-based artist Ticklah, this fall. Initially, the company released RealAudio clips of Polydemic online as a teaser for the $12 CD. Only 350 albums were sold. So starting last week, Razorfish made an MP3 version of the whole album available for $2, a "very provisional" fee, says president Michael Simon. "We're testing the market... If five people download it, it'll stay two dollars. If 6000 people do it, it'll become competitively priced."
For a whole raft of unknowns, the charts of MP3.com's Top Downloads (which are free) have become a low-fi Billboard list, where 7,000 copies can make a superstar. "I've been to Nashville, and I've eaten a lot of baloney sandwiches and learned to like it," says unsigned country singer and comedian Michael Sharp, who distributes through MP3.com. "But the record industry is a political game, and [MP3] breaks all the barriers down." Sharp got so angered over the Rio v. RIAA spat that he penned a song in defense of the format, called "RIAA--Kiss it Goodbye." (Sample lyrics: "Diamond Rio . . . we know what you're going through/ things that you shouldn't have to/but we're going to fight em 2 the end... RIAA is wrong.")