XM and Sirius are coming under attack by the music industry (1 Viewer)

[Ronald Epstein]

BROKEN RECORD

By TIM ARANGO
September 27, 2005 -- EXCLUSIVE

Portable players from satellite radio giants XM and Sirius are coming under attack by the music industry for allowing listeners to record and store songs — something that record executives argue runs afoul of copyright law, The Post has learned.

The Recording Industry Association of America, the record industry's powerful lobbying group, has been holding discussions with XM and Sirius about the devices, which could become the next target in the music industry's ongoing battle to ensure it is paid in a time of rapidly advancing technologies.

"It could become a game of chicken — who's going to blink first?" said one high-level record company executive.

As of yesterday, sources close to both XM and Sirius say the devices will be released on schedule this fall.

Representatives for XM, Sirius and the RIAA declined to comment on the controversy over the players.

Last week, the RIAA discussed the issue on its weekly conference call with representatives of the four major music companies, sources said. And last night, a separate call was held solely to discuss the issues surrounding XM and Sirius' portable devices.

In late July, XM announced a partnership with Samsung to produce a portable device that allows users to record songs from satellite radio broadcasts and then catalog and save favored songs while deleting others.

Sirius later announced a similar device, called the S50, which will be about the size of an iPod and released in October.

The music industry argues the recording capability — essentially Tivo for radio — is a clear copyright violation and could take revenue away from paid download music stores, such as iTunes. One high-level record executive argued the devices give users "permanent ownership of copyrighted material without paying for it."

XM has a deal with the paid service Napster, which allows user to click and buy songs they hear on satellite radio broadcasts. The deal was welcomed by the industry, yet raises the question, in the words of one music exec, "Why would anyone use the Napster platform to buy it if XM is giving it away for free?"

Some record executives expect an ugly battle if XM and Sirius don't modify the devices.

"They can't do this without being sued," said a high-level music exec involved in the discussions.

The rupture over the portable devices comes as the music industry is gearing up to demand higher licensing fees from the satellite radio industry once the current seven-year contract expires at the end of the year.

The current contract is for below market rates — a deal that "essentially financed satellite radio's introduction and gave them a seven-year license at vastly below market rates in order to allow that busines model to occur," said Warner Music boss Edgar Bronfman Jr. at a recent investor conference.

Bronfman's comments came in response to a statement from Sirius chief Mel Karmazin, who said he expected the pricing issue to ultimately be decided by arbitration.

 

[Joe Fisher]

Then I guess the monthly fee I pay a month for XM is a mirage then? :rolleyes

 

[Stu Rosen]

The rights you get when you pay your (and I pay my) XM fee do not include the reproduction right, a separate right under copyright law. I really don't want to get into a fair use argument - just want to point out the reason why many would believe your subscription fee doesn't cover this use.

 

[TheLongshot]

And what stops me from hooking up a normal XM radio to my computer? How about if I hook up a Polk to my computer via optical cable? Basically the same thing.

It isn't like this is high quality audio either. It is basically the equivilant of recording FM.

RIAA, stop looking for excuses for your own incompetence.

Jason

 

[Ronald Epstein]

Jason,

That's the way I look at it....

We aren't talking about high-definition audio
or even CD-quality audio here. I am certain this
is a big reason why none of these services would
ever plan to offer high-definition audio.

What a person is taping is in essence FM-MP3 quality.

Now, you could argue that taping Howard Stern or
Opie and Anthony is a violation of sorts. However,
is this any different than recording a TV show on
your VHS or DVD player for personal use?

 

[Stu Rosen]

Man, I didn't want to get drawn into this, but...

Your right to copy doesn't depend on how good (or bad) a copy it is. The fact that you can easily replicate the XM player's functionality with your PC doesn't mean you have the right to make copies.

And in any event, it isn't the RIAA, necessarily, that has the only dog in this fight. It's also the concern of individual songwriters and music publishers, many of whom are actually not multi-gazillionaires, and most of whom count on their royalties simply to pay their mortgages.

I don't mean to get on a soapbox, but your right to copy doesn't hinge on the greed or stupidity of the owner of that copyrighted work, or on how crappy a copy you make, or whether it's for "personal use."

The only "personal use" exception is under the Audio Home Recording Act, which permits the owner of a CD, for example, to make a copy for his non-commercial use. That's not this.

Now, if you want to turn to Ron's other argument, that this is a Sony Betamax case - that this is merely time-shifting, and a permissible fair use under copyright law, reasonable minds can disagree. But the very nature of fair use is that it rests first on the existence of an infringement, and then forgives that infringement. Even people who claim fair use really don't disagree that when you make a copy of someone else's copyrighted work, and do it without permission, you're infringing.

 

[TheLongshot]

That's true, but again, the RIAA is using a bazooka to kill flies. How many users do they think are going to do this? Personally, it looks like an opportunity to fleece XM and Sirius, because they can point to potential sales and say that "these people can potentially record X amount of songs on these devices and we want Y for that right.", whether or not people actually record songs and keep them on these devices.

To respond of the record exec that asks, "Why would anyone use the Napster platform to buy it if XM is giving it away for free?". Well, gee, XM doesn't play every single song of an artist's collection. Maybe the user will want to actually fill out their collection with these songs? XM is doing what it is supposed to be doing: providing an outlet so people can discover music that the may not have heard otherwise. It is what radio is supposed to do?

I certainly don't begrudge artists getting their fair share. Hell, my CD collection is a testament to that. I do take exception when the big record companies (I wonder how much of XM's actual content they represent?), try to wring as much water out of a stone they can get, meanwhile making life for the rest of us difficult, not letting us have the functionality we are used to.

Jason

 

[Stu Rosen]

But, see, that's the thing - we all decide what's "enough" for the RIAA and, by extension, the record companies and, hopefully, eventually, recording artists. We've decided they're being too greedy. Maybe so. I still don't know why that translates into deciding that it's OK to do something that the owners of content don't want us to do.

You can say it's short-sighted, greedy, flat-out stupid to go after XM/Sirius/downloaders, etc. But that really doesn't justify infringements. I personally think they charge way too much for one of those 60" plasma screens I'd love in my living room, but that doesn't translate into my being justified in walking into Costco and grabbing one without paying for it. Car companies are often incompetent and greedy, and I don't see anyone wearing car theft like a badge of honor.

It seems to me my one true remedy if I don't like the RIAA (or any company I perceive as not deserving of my money) - don't buy their product. Just don't do it.

It's like when I hear people complaining about record companies putting one new track on an old compilation to attract buyers. We have free will. We have control over our wallets (well, I don't, but I assume many of us do). When I look at my Amex bill at the end of the month, I swear, curse, and blame a lot of things (mostly myself), but I don't blame the companies who "made" me buy what I bought...

I have a headache.

 

[Paul E V]

The only things I've recorded, without paying for, are artists/songs that are either very difficult to find or not even available on CD

I had The Jarmels - 14 Golden Greats on order for 4 months before I gave up on finding it and recorded it from the internet. I've only ever heard one of the songs on the radio and that was only one time, I'd never even heard of The Jarmels before that.

 

[Josh:Lyn]

I like what everyone has had to say so far, very good points of view. When I was little I remember using my boom box and recording songs from the radio to make little mixes, but then I would aways go out and get the record later too(ala Jasons comment).

I just think even since the cassete tape came out, people have had the option to record and not buy. But also some people just like to get the music for free and spend more money when they go see a band on tour.

The record industry just always seem to be complaining about anything they can that might hurt their pocket books. I just think maybe, just maybe, they could rethink the way music is made, and then shipped to us, whatever I dunno.

Keep it coming. Like Stu, I now have a head ache.

 

[Bob_L]

If you turn yourself in right now, the RIAA may choose to show some leniency.

 

[Michael St. Clair]

Both XM and Sirius are much worse quality than the 192kbps vbr MP3s that I encode. And they are both worse than FM through a quality receiver.

I could make a better recording on a metal-bias cassette.

The MPAA is silly.