Mayhem & Chaos Blog

File sharing

The post-grokster world takes shape

Right after the Grokster decision everyone had an interpretations as to what would happen in the post-grokster world. Now, a few months after the decision we can see how this picture will shape up:

1. WinMX shut down and is moving operations to Vanuatu. Unlike Kazaa, it sounds like the whole team is actually moving to the tiny island. Kazaa's trick of doing business from .au only threw the RIAA/MPAA off for a little while. How long will it take before these guys get taken down?
2. eDonkey shuts down: Citing that the business cannot defend itself from an onslaught of lawsuits, the CEO tells congress that he is shutting down operations.
3. LimeWire will start filtering copyrighted works: We know from the Napster case how well that works. Some works will get through, lawsuits will be filed and eventually LimeWire will buckle and go out of business.

The supreme court may as well have said: "P2P systems are flat out illegal." This is essentially the effect that we're seeing, a few months on. The reality is that P2P will live on, mostly in open source projects and from companies that are not based in the US. The aspect of the Grokster decision that will take some time play itself out is if it will have chilling effects like the DMCA does -- once people start suing each other over intent, we'll really see the true chilling effects of the Grokster decision. I just hope that won't happen, but I'm not sure if I can be that optimistic.

Also, the WinMX case underscores a trend I've touched on before: Stupid laws in the US cause companies to flee (or avoid) the US in the first place. I'm curious as to how the history books will paint the decline of the US and whether laws like this will ever make the radar.

The only product (company?) that is bucking the trend is BitTorrent, which apparently has taken on $8.75M in venture capital (it is starting to feel like 1999 again, itsn't it?). Given the current trend, this makes no sense whatsoever. Hollywood hates BitTorrent and couldn't do anything against it because it was pointless to sue Brahm, since he has no money. Putting a wad of cash into his pocket will only make it/him a viable target for the MPAA. How exactly would the new BitTorrent company go about proving all of its intentions were pure and noble? Maybe the MPAA will file a lawsuit, just to see what would happen. God knows they have enough cash to throw around.

UPDATE: I just found out that eDonkey is not shutting down -- they are attempting to comply with the RIAA after receiving a cease and desist letter.

Music industry watch

The Future of Music and the NEW music industry

The Future of Music Policy Summit in DC earlier this month was as explosive and emotional as the previous summit I had attended. Going into the summit, I was recovering from Burning Man and was still a bit underslept from my return from the dusty playa. I wasn't pumped about the conference and the first panel didn't really get me into the conference.

But a little ways into the second panel "Panel 02: New Label/No Label Models" I started waking up and coming out of the haze (the triple espresso I had just prior to the panel may have had something to do with it). When Melissa Ferrick was talking about her label "Right On Records" things started clicking for me. She talked about her desires for a label and how the majors weren't equipped to give her what she wanted -- so she started her own label. She still does CD distribution via CD Baby. Click!

More and more small artists are finding themselves in the same spot as Melissa. They distrust the labels, but know that their music is good enough to draw a crowd and sell some CDs. Instead of these small artists trying to go for a major label contract, they are opting to create their own micro-labels. I see micro-labels representing a handful of bands, not hundreds of bands -- this allows the label enough time in the day to focus on all of their artists, not just the top selling ones. One panel member commented about how they got a talking to from a label exec for just selling one million CDs of their latest release -- next time would need to be less disappointing! Many artists would be happy selling a fraction of that, but for the majors this is unacceptable. Micro-labels will be able to focus more time on the promoting all their bands and presumably the labels would have bands that shared some common traits in order to share the same marketing and promotion channels.

The writing for this has been on the wall for some time, but once I started looking at the summit in these terms, a lot more things became clear. A number of companies that were talked about or sponsoring the conference provide services for small artists:

• Royalty Share -- They provide royalty and licensing services for smaller labels. The legal affairs for micro-labels can be a real stumbling block and outsourcing this headache to people who specialize in these matters should allow the labels to focus on promoting artists, not worrying about the books.


• CD Baby -- someone has to take up the headache of selling CD's. CD Baby does it well and also handles getting your content into online distributors.


• OnlineGigs -- promotion and touring tools for bands.


• ArtistShare -- allows artists to raise money from fans to create new works.

Pretty soon bands will be able to join or create micro-labels that pick and choose their services from a number of providers. These services would've normally been handled by regular labels but at huge costs to the artists. In this new model the artists retain their copyrights and the micro-labels spend their money wisely and focus on their few bands. This new model also doesn't require any nasty changes in copyright law -- it simply assumes normal capitalistic rules for commerce that exist today. The labels can do their work inside the current confines copyright legislation -- all the headaches can be outsourced initially -- in other words, the new model is ready for business today!

I'm excited by this new model of doing business in the music industry -- I'll keep my eyes and ears open about new developments and I'll blog them here in the meantime. Stay tuned!

Music industry watch

Thoughts on the music industry

I apologize for the light blogging as of late -- between traveling 6 weeks off and on and thinking about the music industry, I haven't felt like blogging recently. This is finally coming to a close as I think about the music industry and reflect on changes that have occurred in the last few years.

The excellent Future of Music Conference this year made me pause and think about the music industry as a whole. Mitch Bainwol's (RIAA) performance on the State of the Union panel nudged me closer shifting my overall views on the music industry. Mitch's claims that Gary Shapiro's (from the CES) valid points were nothing more than rhetoric and his claims that he wishes to solve the problems of the music industry on amicable terms (at the same time as the RIAA launches another volley of lawsuits) were downright insulting to the audience and other panel members. I think Hillary Rosen was a saint compared to this guy -- if this is the face the music industry is putting forward, then I'm convinced the music industry is moving backward, not forward.

Also, nothing much has changed on the legislative front: The RIAA has not been able to get new laws in their favor passed, which is good news. The copyright reformers are doing a great job of keeping the RIAA and Co at bay, but have been unable to affect any change themselves. I don't think that much of anything on the legislative front is going to change over the next 5 years. Yes, we'll continue to squabble over what the Grokster decision means and how to reform section 115 of the copyright act, but no real forward progress can be expected.

The absolutely asinine moves by the recording industry of late would've normally given me a lot to blog about recently: Mac users should just buy regular CD players, Record industry releases malware that deletes your P2P software, Jobs Resists Music Industry Pressure and on.... But really, I'm over it. The only thing the industry has done in the last few years is to license their catalog to iTunes and the likes -- for too much money and now they want more. This whole thing is starting to sound like a broken record, repeating over and over again. It started with piano player rolls back in the day, went on to FM radio, audio cassettes, the video recorder until we reach the modern age with P2P -- each time the industry wants to stamp out new technology.

So, unless the RIAA/MPAA make some really serious gaffes, I won't be talking about them here. I can waste my time on better things. However, I will continue to talk about the music industry. The new music industry, not the old dying one. Ever since I joined EMusic back in 1999, I've been talking about how we need a parallel universe music industry. A new music industry that gets the digital age and is not afraid of it. The good news is that its starting to happen -- the first signs are becoming clear and I expect things to pick up quite a bit in the next few years.

Stay tuned for my next post, where I give you some more insights on the Future of Music Conference and what I think the new music industry will look like.

Burning Man

Burning Man 2005

[ I'm back from the playa and onto my next adventure -- the Future of Music Policy Summit in Washington DC. I wasn't quite ready for the real world when I returned from the Playa and I certainly wasn't ready to go to DC. But here I am and after some much needed sleep, I'm feeling a lot more up for attending (and participating in) a conference. ]

Anyway -- Burning Man was awesome. Of course the usual words can't describe it -- Burning Man can never be described in words. To take it all in, to understand, you need to go. After all these years its still true.

This year was markedly different from the previous few years. After last year I was contemplating taking a year off to not burn out (pun intended), but then the Borg 2 came along and promised to shake things up and get more art into the playa. Then more of my friends said they wouldn't be going, which was alarming at first, but then I realized that these friends had gone multiple years, but most of them had never created any art. So no great loss. But this mounted some amount of uncertainty over the event, which became a draw for me. The last time I felt this uncertainty was in 1997, which turned out to be the best Burning Man for me yet.

The Fandango camp was allotted much more space this year and we were not packed in like sardines they way we had been the last two years. We grew more organic and took on more people that had never camped with us before. And even some people like Simone, who we didn't know at all, fit in perfectly with us. The Fandango/Orbitals camp was stocked with good communal areas like the Monkey Lounge and Chad's geodesic dome and the ever important showers. With fewer people in camp, there were shorter lines for the shower too.

In the Orbitals camp people were constantly making food for the rest of the group. Bacon was the camp food of choice. I was fed quesadillas, grilled cheez sandwiches and several types of burritos -- to the point where I never ate my own lunch food. So in the end I started feeding people bagels with lox and cream cheez because I never ate my lunch. I also made a tons of espresso for people (175 shots all told), which was a big hit with my regular customers. Being in camp was fun -- very much fun indeed!

And then there was the art -- the gobs and gobs of art everywhere. Some important projects from last year came back, and a number of new multi year art projects made it to the playa this year. (These multi year projects are probably one of the reasons why last year there was so little art). Please keep an eye on my photo blog over the next few weeks as I post pictures of my favorite art pieces from the playa -- there were so many of them, that I am planning on posting nearly a 100 pictures this year.

Back to Borg 2 for a second -- Borg 2 started out with some lofty goals for this year (raise $250,000 for art) and then quickly changed that to 250,000 pennies, but in the end they raised only $5000. Weak. Raising money is hard. They funded Dance Dance Immolation, which was really cool (and run my good friends of mine), but aside from that the Borg 2 art I encountered in the playa left me wondering: What is this and what is it good for? To say the least, I was not impressed.

I think the only good thing that Borg 2 did was to actually shake up BMorg a bit and cause more funds for art to be kicked loose and for more focus and organization on that art. Which in the end worked out real nice. But does Borg 2 need to come back next year? Not sure -- if they do, I hope they start with more realistic expectations this time.

As for me: I'll be back. I'm taking a break until January and then I'll continue working on my art scooter. My energy in Burning Man has been renewed!

Burning Man

Burning Man Art

Wow. I'm still on the playa, and the Burning Man art here is astounding. Much much better than last year -- I'll start posting pictures as soon as I get back to a reasonable net connection.