[Ecommerce] RIAA admits CD-R more a threat than P2P

[Michelle Childs]

http://www.theregister.co.uk/2005/08/15/riaa_cdr_p2p/

RIAA admits CD-R more a threat than P2P

By Tony Smith
Published Monday 15th August 2005 11:38 GMT

The Recording Industry Ass. of America has acknowledged that P2P
file-sharing is less of a threat to music sales than bootleg CDs.

The RIAA's chief executive, Mitch Bainwol, last week said music fans
acquire almost twice as many songs from illegally duplicated CDs as from
unauthorised downloads, Associated Press reports.

According to Bainwol, in turn citing figures from market watcher NPD, 29
per cent of the recorded music obtained by listeners last year came from
content copied onto recordable media. Only 16 per cent came from illegal
downloads.

Legal downloads accounted for four per cent of music acquisitions, while
official CDs accounted for almost 50 per cent of the total.

The RIAA's favoured solution appears to be copy-protected CDs, which are
gradually spreading throughout the music CD market. This approach "is an
answer to the problem that clearly the marketplace is going to see more
of," Bainwol told the news agency.

Over the last few months, we've seen a growing number of stories published
by the mainstream media that highlight the growing number of
copy-protected CDs in the market and, in particular, those that have
become big sellers. If we didn't know better, we'd suggest this was all
part of a scheme to attempt to ease consumers' concerns that the music
industry is out to make it a darn sight harder to listen to music on a
computer. But they wouldn't do that, would they? Ahem.

Now that copy-protection has gone beyond crude early attempts to foist
poor Java music player software on consumers, and to limit their ability
to make copies for personal usage - in those territories where such 'fair
use' rights are enshrined in copyright law, at least - the music industry
seems a lot keener to release anti-rip discs. Much-improved hardware
compatibility has helped too.

The fly in the works is, of course, Apple. A recent Reuters story covering
the sales success of copy-protected CDs contain quotes from a number of
folk bemoaning the lack of support for the iPod. So far, copy-protection
schemes are Windows only, since they dump PC-ripped music as Windows Media
files. The iPod doesn't support Windows Media file formats or DRM.

Music industry figures were grumbling that Apple's apparent unwillingness
to license its FairPlay DRM technology - or, more likely we suspect, do so
at a price the music industry is willing to pay - prevents them from
creating music files that can be transferred to and played on an iPod.

What the report failed to note was that the Mac version of iTunes has
generally been fairly robust in its unwillingness to cater to
copy-protection technologies. When we reviewed Macrovision's then
state-of-the-art CDS-300 version 7 copy-protection scheme last year, while
it happily imposed restrictions on Windows users, the sample tracks we
were challenged to rip where easily converted from CD audio to MP3 on a
PowerBook G4 running iTunes. Right now, the solution to copy-protection
appears simple: buy a Mac.

In any case, Apple wants iPod owners to buy songs from the iTunes Music
Store, not on CD, so there's little to be gained from licensing FairPlay
for incorporation into CD copy-protection systems. That may change when
Apple comes to renegotiate its iTunes sales licences from major and minor
labels, on which Apple is undoubtedly banking on the growing success of
iTunes as its prime bargaining tool that the current licensing regime be
maintained. =AE




--
Michelle Childs -Head of European Affairs
Consumer Project on Technology in London
24, Highbury Crescent, London, N5 1RX,UK.
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http://www.cptech.org

Consumer Project on Technology in Washington, DC
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Consumer Project on Technology in Geneva
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