President’s Report

Digital Dilemma Looms Large for Musicians

Volume CII, No. 12December, 2002

Bill Moriarity

On Sept. 3, a bankruptcy judge rejected a deal for the German media giant Bertlesmann to buy the assets of the bankrupt Web site Napster, claiming that the two managements were too cozy. Napster may be saved yet by an as-yet-unnamed buyer, but the site will have to reincarnate in a different form. As 802 members saw the rise and fall of Napster, they might well have asked if the Internet – that teeming electronic democracy – would turn out to be good, bad, or something in between for professional musicians.

When Thomas Edison first created the technique of recording music in 1877, it led a similar revolution for music. Suddenly, live music was no longer supreme. A musician’s skill and talent could be frozen in time and sold, given away or stolen. Enter the record labels. Musicians tried to keep control of their product by forming performing rights organizations (for composers), and pushing for new AFM mechanisms (for performing musicians) – including the MPTF, Special Payments and the pension fund itself.

At least when records were vinyl, it was relatively easy to prevent illegal ripping off, because owning your own record press was not a simple matter. But with the advent of cassette tapes and cheap tape recorders, suddenly pirating became a serious issue. And in the 1990’s, technology took an even greater leap. When most creative acts – such as writing, visual art or music – can be sampled and turned into ones and zeroes, and when those ones and zeroes can be transmitted over a global computer network (the Web), the effects are staggering. Not only can a musician’s recording work be pirated instantly, but employers operating in other countries can undercut AFM agreements with a few quick clicks of the mouse.

Some members undoubtedly use the Web for greater distribution of their product. Garage bands, folk musicians, chamber ensembles and those who buck the hegemony of the big labels can use their own Web sites or legal sites like to distribute music quickly, cheaply and on their own terms. The Internet may be a good thing for these musicians.

But for traditional session players, those who worked for big labels, and even royalty artists, the Internet is turning out to be a very scary place.

It all springs from Napster, the infamous Web site that is currently defunct. When Shawn Fanning, a Boston college student, invented it in 1999, he threw gasoline on the fire of the Internet problem. Suddenly record labels took notice. Fanning took what’s now called “peer to peer” (P2P) technology and applied it to music sharing. The Napster software let you upload your CD collection onto your computer. Someone else – in a different part of the world – running Napster software could search through your computer’s hard drive, find what music you wanted to share, and download it. It was like making a tape of friend’s album in the 1970’s. Except with digital technology, the downloads were almost-perfect replicas of the original, and with the popularity of CD burners, soon you could pirate an album that had just hit the shelf. The record labels cried foul, although consumers said that this pirating merely let them preview albums; if they liked what they heard on Napster, they would buy the real thing.

The AFM and a host of musicians had opposed the site, which shut record labels out of profits and musicians out of royalties. Even side musicians – who generally do not earn royalties – lost out, because when record labels don’t register sales, the labels’ contributions to the Special Payments Fund are lower than they should be.

A host of Napster-like sites still exist, each claiming that they’re different from Napster because they don’t know who their users are, or they operate outside of the United States. The AFM and the record industry are taking aim at them, one by one.

The AFM is a member of the MUSIC (Music United for a Strong Internet Copyright) Coalition, which fights Internet pirating. On Sept. 26, the coalition kicked off a campaign to educate the public about internet piracy. Eminem, Madonna, the Dixie Chicks, Missy Elliot, Elton John, Sting, Phil Collins, Luciano Pavarotti, Brian Wilson, Britney Spears and Natalie Cole are some of the royalty artists who are signed onto the campaign. The coalition does not aim to completely stamp out P2P music-sharing technology – “Digital downloading is here to stay,” said Garth Fundis, chairman of the National Academy of Recording Arts and Sciences. Rather, the group wants the public to understand that free downloads of copyrighted music is the same as stealing.

It’s ironic that this struggle has put the union and employers in the same boat. President Tom Lee has said, “The truth is that thousands of working musicians who are struggling to survive really suffer if music lovers refuse to pay for the music they enjoy.” He knows that when record labels lose profits to pirating, they are less likely to find, sign and develop new artists. And there is the matter of Special Payment money that the union loses when record labels are pirated – but only if the label in question is an AFM signatory in the first place.

To combat the illegal pirating, record labels are trying to set up legitimate pay-for-use sites, where users could legally purchase the rights to download a tune onto their computer. Bertlesmann has invested in one, called MusicNet, along with AOL Time Warner and EMI. However, even the legitimate sites are running into copyright problems. It is a major chore simply to find out who owns the copyright to each tune. And sometimes the artists themselves don’t want their tunes on the Internet – even legitimately sold there. The labels aren’t sure whether Internet distribution (the legal kind) will help or hurt CD sales. And will technology prevent people from legitimately buying a tune and then giving it away to a friend? That’s just the same as downloading it illegally.

In the meantime, Napster’s assets have been purchased by an anonymous bidder, who was expected to be named by the end of November. Will Napster – and the Napster clones – find a way to operate legitimately and protect musicians’ rights? Are musicians truly aligned with record labels in this struggle? Does digital music sharing really eat into profits as much as labels suggest? Will consumers continue to pirate music no matter what happens? These questions cannot yet be answered. It can be said with some certainty, however, that this technology can’t be stopped. One thing we know from our experience in motion pictures, sound recordings, radio and almost all the electronic fields: the only constant is rapid change and we must learn to deal with it.